China Labour Inspection Review Conclusions

1. China Labour Inspection ReviewConclusions Changhee Lee Senior Specialist on Industrial Relations and Social Dialogue Labour Inspection Strategy Symposium Xian, 25th November 2009

2. General observations • China’s LI system made impressive progresses in short time and produced major innovations, which have potentially global values • There exist, however, difficulties and imbalances throughout the system. • LI system characterized by significant local diversities and a multitude of intervening actors • How to ensure spread of innovations in a standardized manner and to ensure equitable enforcement throughout the country?

3. Guidance from the leadership of LI Bureau: four challeging issues • Improving institutions • Improving law enforcement • Strengthening 2N Network System • Strengthening capacity building • Roles of LI beyond mere a law enforcement tool towards ‘a force for reform and a powerful means of initiating changes’ at the workplace!

4. Improving LI Institutions 1 • After creation of LIB, importance attached to formulation and implementation of a medium-to-long-term Development Plan for LI System. Main goals of the Plan are as followings (Nanjing Work Conference, 2008) • Improving LI legislation and work systems • Accelerating innovation in LI supervision mechanisms • Enhancing the enforcement capacity of LI • Changing LI’s scope from supervision on urban areas to coordinating urban-rural supervision • From reactive to pro-active, and to early-warning and prevention • MOHRSS/LIB Document No. 10 on setting up LIB at all levels (down to district level)

5. Improving LI Institutions 2 • Challenges remain with regard to • LI divisions and LI teams exist side by side • Needs to aim at creating one single, unified ‘corps’ of technically competent and skilled labour inspectors • Due consideration needs to be given to using LI Assistant as a pool for recruitment of new LI staff • Due consideration needs to be given to the fact that there is no legal requirement that all law enforcement inspectors should be civil servants

6. Improving law enforcement 1 • Better law enforcement requires a modern, up-to-date LI enforcement policy, outlining vision/mission for IL service; principles of LI; basic parameters; implementation strategies; balance between preventive/advisory role and controlling/supervisory role, between proactive and reactive interventions; special strategies and procedures for SMEs • Addressing more effective ways of handling ‘serious cases’; making the desk-top review LI process more result oriented; special attention to vulnerable workers; special attention to high-risk violation sectors; strategic use of sanctions for preventive purposes

7. Improving law enforcement 2 • 1. Need for developing comprehensive enforcement policy guidance • Current there is a complex web of various policy references (laws, regulations, ministerial decrees, measures, plans, documents, guidelines etc) • Tendency to rely on ‘punishment’ and a notion that “the State, not the employer guarantees working conditions and labour protection • 2. Need for creating an appropriate regulatory framework • 1994 Labour Law (MOHRSS) on OSH vs. 2002 Work Safety Law (SAWS); review of 2004 LI regulation and 1994 Measures for Management of LI • Need for appropriate and comprehensive legal base for LI itself • Opportunity (and future obligation) to fully utilize internationally recognized labour inspection values and principles (C. 81) and international best practices

8. Improving law enforcement 3 • 3 Need for better enforcement procedures • Lack of uniform standard procedures, which can result in unsystematic approach, lack of transparency, coherence and consistency • Modern, functional LI procedures are best adopted through dialogue with stakeholders and are then laid down in a single comprehensive Operations Manual

9. Strengthening the 2 N System 1: innovative potentials • 2 N system represents major innovation and potentially very effective strategy to establish more noticeable LI presence at grass-root levels (streets and townships, even community), where majority of small enterprises operate (often in informal economy). It could be a key element of an ‘early warning system’.

10. Strengthening the 2 N System 2: challenges • LI assistants: potential assets for effective LI, but questions regarding their status, roles, funding, authorities and qualifications remain • Design and format of Workplace Information Management System (WIMS) linking the grass-root teams with the mainstream administration, but there exist a urgent need for a common and unified approach under the central guidance • Uniform standards and criteria for 2N System needs to be set by central LIB

11. Elaborating LI’s labour relations role • Significant workloads of labour inspectors are associated with labour relations problems • A need to consider a way to reduce overall time inspectors spend on IR issues by improving dispute settlement procedures and improving mediation/arbitration services • Para 2 of ILO C. 81: “any further duties…entrusted to labour inspectors shall not be such as to interfere with the effective discharge of their primary duties” • Para 8 of ILO C. 81: “The functions of labour inspection should not include that of acting as conciliator or arbitrator in proceedings concerning labour disputes” • More proactive approach of inspectors to encourage social partners to set up and use bi-partite dialogue and grievance handling procedures at the workplace level required

12. Strengthening capacity building 1 • Training is the essential part of the LI modernization and development process. • Systematic training includes pre-service, induction, refresher, specialist, training for higher responsibilities • They reinforce the importance of a planned and coordinated approach to personnel management and HRM

13. Strengthening Capacity Building 2: training needs • Modern labour inspection enforcement techniques, skills and methods • Comprehensive induction to basic work safety issues to better identify and cross-reference OSH violations to their WSA colleagues • Social skills training: hot to be efficient while remaining non-confrontational in the face of aggressive employers; how to deal with uncooperative managers; how to best motivate and stimulate them towards compliance; how to encourage dialogue between management and workers etc

14. Advisory, information and public relations service capacity • Building competence to make inspectors as advisors as well as enforcers • At the same time, building an institutional advisory and information service capacity within LIB at different levels

15. Organizational capacity of LIB at central level • 15 officials at national level responsible for LI of the country with 1.3 billion population, having to deal with diverse challenges and wide range of responsibilities. • Need a functional, efficient HQ structure, with a ‘Field Operations Management’ divisions and other specialized divisions

16. LI and OSH Inspection: Common issues 1 • Punishment and sanction oriented, no enough room for advice, stimulation or motivation of employers to go beyond mere implementation of legal requirements • Data at national level either incomplete or incorrect. Need to improve parameters and functionality of the existing information management systems, the criteria and procedures for information collection • Educational and professional qualifications of the inspectors. Recruitment criteria, clear job descriptions or classifications, inspection-specific entry examination, and realistic but high performance standards • Inspection procedures. Current procedures seem to be overly complex. Need to be developed through social dialogue • Need for clear, binding, harmonized and unified standars of ethical and professional conduct • International Association of Labour Inspection developed a universal ‘Code of Integrity’

17. LI and OSH Inspection: Common Issues 2 • Consultation and coordination between LI and OSH inspection services • Good example of “case referencing” need to be institutionalized • Periodical consultation between two agencies at any level • Perhaps through “Agency Agreement” • Social dialogue on labour inspection • No institutionalized social dialogue on LI • Except special campaigns involving many agencies including ACFTU • Particularly near absence of institutionalized involvement of employers/business associations is a problems • Social partners are main ‘clients’ of LI and OSH inspection, who have considerable knowledge and experiences • Need to add a sectoral dimension to LI and OSH inspection to address sector specific issues • Need to establish a multi-stakeholder body with advisory capacity • Workplace bi-partite labour relations institutions have important role as a preventive mechanism • Conflict of interest situation regarding union representation