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Wednesday, 22 October 2008
Closure of toy factories was premeditated, say authorities
Guangdong authorities have described the closure of Hong Kong-listed Smart Union’s three factories in the province last week as a premeditated move that deliberately left workers and suppliers in arrears.
Closure of toy factories was premeditated, say authorities
Fiona Tam 22 October 2008
Guangdong authorities have described the closure of Hong Kong-listed Smart Union’s three factories in the province last week as a premeditated move that deliberately left workers and suppliers in arrears.
“[We believed Smart Union] intentionally owed workers back pay and defrauded suppliers of goods and money,” Guangdong’s Emergency Management Office said.
The office said Vice-Premier Zhang Dejiang had ordered a thorough investigation and told provincial authorities to use government money to cover back pay and to offer re-employment opportunities to laid-off workers.
The province said more than 8,700 workers had been affected by the three factory closures in Dongguan and Qingyuan.
It said the company owed more than 27 million yuan (HK$30.7 million) to employees and a further 200 million yuan to 800 suppliers.
Labour-law lawyers estimated Smart Union would need to pay an additional 100 million yuan in severance to former employees, the Southern Metropolis News reported.
Guangdong authorities have promised to deploy work teams and police to help the unemployed. All will receive outstanding back pay before Saturday. Overtime and severance payments would probably be handled in mediation sessions by labour-dispute departments.
The emergency-management office said the three closed factories would be sealed by authorities.
A temporary job-centre service would be offered outside the factories to help workers find new positions.
Guangdong authorities said the layoffs had created social instability because thousands of frustrated workers were continuing to rally in the streets for back pay.
Mainland censors have blacked out footage of demonstrating workers broadcast by Hong Kong television stations in recent days.
The office said it concluded that Smart Union’s closures had been premeditated, based on information from workers and suppliers, and that those in charge of the three factories had fled.
At least five Hong Kong companies have closed their factories in Guangdong during the past week. Mainland media say the employers cannot be located.
Authorities refused to say whether the other closures had been premeditated, but said they would thoroughly investigate suspect companies to avoid further closures.
Mainland newspapers questioned the toymaker’s surprise closure and demanded the “whole truth” yesterday.
Authorities in Zhangmutou township in Dongguan have been widely criticised for using about 24 million yuan in taxes to cover unpaid wages for a bankrupt Hong Kong company. Township spokesman Wang Zhonghua was quoted by China Business News at the weekend as saying that the township had used all its annual budget to help the 7,000 penniless workers.
About 1,700 workers from Smart Union’s Qingyuan factory are expected to receive 3.6 million yuan in back pay before Saturday.
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Closure of toy factories was premeditated, say authorities
Fiona Tam
22 October 2008
Guangdong authorities have described the closure of Hong Kong-listed Smart Union’s three factories in the province last week as a premeditated move that deliberately left workers and suppliers in arrears.
“[We believed Smart Union] intentionally owed workers back pay and defrauded suppliers of goods and money,” Guangdong’s Emergency Management Office said.
The office said Vice-Premier Zhang Dejiang had ordered a thorough investigation and told provincial authorities to use government money to cover back pay and to offer re-employment opportunities to laid-off workers.
The province said more than 8,700 workers had been affected by the three factory closures in Dongguan and Qingyuan.
It said the company owed more than 27 million yuan (HK$30.7 million) to employees and a further 200 million yuan to 800 suppliers.
Labour-law lawyers estimated Smart Union would need to pay an additional 100 million yuan in severance to former employees, the Southern Metropolis News reported.
Guangdong authorities have promised to deploy work teams and police to help the unemployed. All will receive outstanding back pay before Saturday. Overtime and severance payments would probably be handled in mediation sessions by labour-dispute departments.
The emergency-management office said the three closed factories would be sealed by authorities.
A temporary job-centre service would be offered outside the factories to help workers find new positions.
Guangdong authorities said the layoffs had created social instability because thousands of frustrated workers were continuing to rally in the streets for back pay.
Mainland censors have blacked out footage of demonstrating workers broadcast by Hong Kong television stations in recent days.
The office said it concluded that Smart Union’s closures had been premeditated, based on information from workers and suppliers, and that those in charge of the three factories had fled.
At least five Hong Kong companies have closed their factories in Guangdong during the past week. Mainland media say the employers cannot be located.
Authorities refused to say whether the other closures had been premeditated, but said they would thoroughly investigate suspect companies to avoid further closures.
Mainland newspapers questioned the toymaker’s surprise closure and demanded the “whole truth” yesterday.
Authorities in Zhangmutou township in Dongguan have been widely criticised for using about 24 million yuan in taxes to cover unpaid wages for a bankrupt Hong Kong company. Township spokesman Wang Zhonghua was quoted by China Business News at the weekend as saying that the township had used all its annual budget to help the 7,000 penniless workers.
About 1,700 workers from Smart Union’s Qingyuan factory are expected to receive 3.6 million yuan in back pay before Saturday.
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