China Labor Group Says Activists Detained in Shoe Factory Strike

Chinese authorities detained a pair of labor activists who are advising striking workers at a shoe manufacturer for brands including Nike Inc. (NKE) and Adidas AG (ADS), China Labor Watch said.

The two activists, Zhang Zhiru and Lin Dong, entered a factory belonging to Yue Yuen Industrial Holdings Ltd. (551) in Dongguan to help workers after a strike began April 14, China Labor Watch said on its website. Zhang’s wife Xiao Hongxia said the last time she reached her husband was midday April 22, when Zhang told her he had met with security officials.

“I called my husband at noon yesterday, asking if he would be coming home to eat,” Xiao said in an interview on April 23. “He said he was in Dongguan and already having his meal. I haven’t heard from him since.”

Workers at the Dongguan factory complex, where more than 40,000 people work, are striking in a dispute over pay and benefits. Adidas has moved some future orders originally allocated to Yue Yuen to other suppliers to minimize the walkout’s impact on operations.

Adidas has no plans to pull out of the factory completely, Katja Schreiber, a spokeswoman for the German sportswear maker, said yesterday in an e-mail. Greg Rossiter, a spokesman for Nike, reiterated that the Beaverton, Oregon-based company is monitoring the labor dispute and production at Yue Yuen.

Zhang, manager of the Shenzhen Chunfeng Labor Dispute Service Center, and Lin advised some employees in the Yue Yuen factory on how to do collective bargaining, said workers who asked not to be identified because they feared they or their family members could lose their jobs.

Social Media

Wang Jiangsong, a professor specializing in labor relations, and Zeng Feiyang, head of the Guangdong Panyu Migrant Worker Center, also said in interviews that Zhang and Lin had been detained.

Zhang and Lin also offered advice via social media, telling Yue Yuen workers at the factory not to use violence or break the law, according to comments posted on their QQ instant messaging service accounts.

Two phone calls to the Shenzhen Chunfeng Labor Dispute Service Center yesterday went unanswered. A Dongguan police employee who answered the phone and asked not to be identified said he had no information to release.

The shoemaker is engaging with workers, the local government and the unions, said George Liu, a spokesman for the Hong Kong-based company.

Yue Yuen, which had 423,000 employees as of 2012, also makes shoes for brands including Puma SE, Asics Corp., New Balance, Timberland Co. and Reebok.

Equipment Removed

Some equipment at part of Yue Yuen’s factory, in the country’s south, was being removed and put into trucks, China Labor Watch reported on its website. Yue Yuen spokesman Liu said in an e-mail the company is “still committed” to maintaining production in Dongguan and declined to comment “about any particular customer.”

Yue Yuen offered to add a monthly living allowance of 230 yuan ($37) at its factories in southern China starting May 1, Liu said April 21. It also agreed to bring forward to next month a social-security benefit plan originally scheduled for 2015, he said.

Employees interviewed at the factory over the weekend said the company still hadn’t met their demands for more pay, a change in contract status and reimbursement for unpaid benefits contributions. Some demanded that strikers not be punished and be given the right to elect their own union leaders.

Yue Yuen fell 1.6 percent to HK$24.40 at the 4 p.m. market close yesterday in Hong Kong, after dropping 5 percent the day before.

Second Time

Lin’s detention would mark the second time he’s been held over the Yue Yuen strike. He was forced to leave Dongguan on April 13, he said in an April 18 interview. Lin said he and a colleague were having dinner at a hotel restaurant when police arrived and brought them to a station for questioning.

The two were later driven to the road leading to Shenzhen and asked to leave, he said.

A posting on Zhang’s QQ instant messaging service account at 9:21 a.m. two days ago said, “My QQ is behaving like it’s been poisoned!”

China has taken steps to suppress dissent and activists, with the ruling Communist Party jailing legal scholar Xu Zhiyong in January. Xu helped start the New Citizens’ Movement, an alliance of activists that sought to promote rule of law, democracy and official disclosure of assets. In 2009, China also detained human rights activist Liu Xiaobao, who won the Nobel Peace Prize in 2010.

Benefits Dispute

In Dongguan this month, strikers expanded demands to include more pay, contract improvements and other guarantees after an initial dispute over the amount the company contributes to government-mandated social security and housing benefits for workers.

Monitoring group China Labour Bulletin said on its website that strikers at the Dongguan facility numbered at least 10,000, while Yue Yuen said April 16 that more than 1,000 were involved.

Police with riot gear and dogs were present outside Yue Yuen’s 1.4 million-square-meter (15 million square-foot) Dongguan complex on April 21.

Dozens of workers were taken away by police last week, the official Xinhua News Agency reported April 17, without saying why the workers were taken. No one was injured and there were no clashes, Xinhua reported.

Police have told workers not to congregate around the factory, said three workers who asked not be identified for fear of losing their jobs.

To contact Bloomberg News staff for this story: Liza Lin in Shanghai at llin15@bloomberg.net; Penny Peng in Beijing at ppeng18@bloomberg.net

To contact the editors responsible for this story: Stephanie Wong at swong139@bloomberg.net Dave McCombs, David Risser

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