Betrayed by a state-owned enterprise

News of the Labour Movement in China


Betrayed by a state-owned enterprise

Ex-employees protested at China Construction Bank's general meeting of shareholders in Hong Kong


On 29 June 2014, at its shareholders' general meeting in Hong Kong, one ex-employee, Zhang Hong, asked China Construction Bank's chairman, Wang Hongzhang, “why did the bank unlawfully retrench and buy-out its workers?” Nobody answered this question at the meeting, which lasted for only a dozen of minutes. When Wang stepped out of the meeting room, a group of former employees surrounded him, demanding him to explain why he put “retrenched employees” in a sub-meeting and what right he had to deprive former employees, who were also shareholders, the right to attend the main meeting.


They call themselves “retrenched workers”.

Zhang Hong used to work at China Construction Bank's branch in Shaanxi Province. He calls himself a “retrenched worker”, meaning that his severance was bought off by the bank (termination of labour relations). In China, there are some 600,000 retrenched workers like Zhang Hong, from four major state-owned banks (Industrial and Commercial Bank, Construction Bank, Bank of China and Agricultural Bank). In June, Zhang traveled with some 40 retrenched workers from China to Hong Kong, but half of them were denied entry to Hong Kong at the border control. Of the 20 fellow retrenched workers who managed to arrive in Hong Kong, only one managed to enter the main venue of the shareholders' meeting.


State-owned banks lied to deprive workers' rights.

Zhang Hong recalls that when the four major banks were preparing to launch their IPO, the State Council issued documents, asking them to downsize their workforce. 110,000 workers lost their jobs before China Construction Bank was listed in Hong Kong in 2003.


“At that time, our branch leader made us an offer: those with five-year employment or longer would get  60,000 Yuan severance pay and temporary contract workers would get about 30,000 Yuan. After retrenchment, the bank would stop paying for our social insurance and we had to sign an agreement to look for future jobs by ourselves (an agreement to terminate labour relations voluntarily).”


The branch head kept persuading Zhang to take the offer, saying that from then on he would have to pass an annual appraisal and the compensation would most likely drop. With this background, Zhang and many of his fellow workers accepted this retrenchment offer and became retrenched workers.   


Yet, over the course of time, retrenched workers realized that those branch leaders, who had managed to reach a certain quota of “selling” the retrenchment plan to workers, were awarded with large bonuses. While the banks are making enormous profits, they have never re-employed their former employees. Instead, they recruited new workers within a short time after the retrenchment. According to China's Labour Law, this form of retrenchment is illegal. "Labourers shall be entitled to social insurance treatment (including unemployment, pension, medical insurance and other social insurance) when they become jobless”, states Article 73 of China's Labour Law. This means that workers should not be “neglected” even when they are out of a job and therefore, “retrenchment” is not necessary.


No one to count on except themselves.

Zhang and other retrenched workers share a grim prospect for their old age; they will be worse off than ordinary unemployed people. Over the years, they have sought help from the Central Commission for Discipline Inspection, Central Military Commission, All China Women's Federation, All-China Federation of Trade Unions, State Council and bank headquarters. Yet, none of them have listened to their case. They have also filed a case at court but the court refused to take it on, stating that it could not manage affairs related to the transformation of SOEs. Despite these hardships, the workers do not give up their fight. While some retrenched workers found their way to protest at the shareholders' meeting in Hong Kong, some 300 workers have also protested at the provincial branch in Hunan. Many of them have been detained, put under house arrest, or prohibited from talking to media. However, they are determined to fight for their rights and will never give up until justice is done.


The laid off employees from China Construction Bank

came to attend the annual shareholder meeting in HK.

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