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China's New Labor Law: Results Still To Be Determined

By Dan Harris and Steve Dickinson

Yale Online just came out with a very thorough and objective article on China's new labor law. The article, entitled, "An Uncertain Victory for China?s Workers," is written by Lyle Morris, of China Economist Magazine. This article gives sets forth a very plausible analysis of the cost impact of the new law:

Karen Lin, a senior fund manager at Paradigm Asset Management Co. in Taipei, predicts the law will add roughly 25 percent to the cost of labor in China, which typically accounts for 10 percent of total manufacturing costs.

The article sees the big issues as whether workers will seek to enforce the new laws and whether courts will enforce them. Based on what I am hearing from our clients, my firm's people in China, and the Chinese lawyers with whom we work, the answer is a tentative yes to both questions. For more on China's new labor contract law, check out my last post on this topic, earlier this month, entitled, "China's New Labor Law -- Just Deal With It." That post also links back to seven previous posts on it.

Full post as published by China Law Blog on June 30, 2008 (boomark / email).