China: Can China improve work safety?

Asian Labour News, 8 May 2004

An online database of news about workers in Southeast Asia and China and the issues that affect them.

This article—by Columbia University associate professor of law John Fabian Witt—has popped up in Singapore as well as Bangkok (the latter version is posted below). I'm not sure why the Bangkok Post chose to run it, but it's worth posting here whatever the reason.

Despite the title, it's more an article about the history of work safety in the US than whether China can improve its own record. At the core, though, I think he raises an interesting issue (without actually stating it): how do the Chinese go about develop[ing the] basic legal institutions that he argues are the key to improving work safety in China? There's some interesting work by Fiona Haines in the Department of Criminology at University of Melbourne on regulatory reform and safety standards in Thailand after the Kader Toy factory fire that suggests reform of legal institutions (i.e., making more or tougher laws on the basis of best practice in the EU or US) doesn't really solve the problem. Her work in Thailand is perhaps more relevant for China than Witt's views based on the American experience.

You can find a version Fiona's argument here (and I've pasted an abstract of her views below Witt's piece). I think this is an important debate. If Fiona is correct, then the answer to how China can improve its work safety record may not lie simply in the development of basic legal institutions. And if that's the case, the money being thrown at such initiatives by funders abroad may realise fairly limited returns.

But first to Witt's piece.

After a massive gas well explosion killed 243 people in southwest China last December, China's State Council and National People's Congress have announced new rules for industrial safety. The authorities' response follows a now-familiar pattern: high-profile pronouncements in the wake of workplace disaster give way to neglect of basic safety standards. But if Western experience is any guide, ad hoc responses to high rates of work accidents won't reduce the risks to Chinese workers. Only the development of basic legal institutions will help make Chinese workplaces safer.

China and other developing Asian economies are experiencing an industrial accident crisis of world-historical proportions. Official sources report 14,675 industrial-accident deaths in China in 2003, but statistics on workplace accidents are notoriously unreliable, and some observers suggest that the number may be closer to 120,000.

China's coalmines are among the most dangerous places to work in the world. Chinese garment factories have repeatedly experienced disasters on a par with the infamous Triangle Shirtwaist fire in New York City a century ago, which killed 146 workers, all young women.

Conditions may well get worse before they get better. Even though China instituted new initiatives in industrial safety at the beginning of 2003, official estimates indicate that industrial accident deaths increased by almost 10% last year.

Yet as the example of the Triangle fire suggests, China's experience is not unprecedented. Until the recent Asian accident crisis, the poorest workplace safety record in world history belonged to the United States in the 50 years following the American Civil War.

Coalmines in Pennsylvania in the 1860s _ where 6% of the workers were killed each year, 6% crippled, and another 6% temporarily disabled _ looked very much like the mines now operating in China's Shaanxi province. Industrywide, one American worker in 50 at the turn of the last century was killed or seriously disabled each year in work-related accidents. Accidents were the leading cause of death among workers in dozens of hazardous industries. Of course, American industry is still plagued by serious safety problems. But seen from a historical perspective, there has been a striking decline in work-related injuries and deaths in the US. There were 30,000 annual work-related fatalities a century ago; today, the annual average is around 5,000, even as the population has tripled.

What explains this huge improvement in occupational safety in the US? Increased union membership in the mid-20th century clearly helped, as workers bargained and lobbied for improved working conditions. In recent decades, some of the most dangerous work has been shipped overseas (ironically, much of it to China). And as Americans have grown wealthier, they have been willing to spend more on safety.

But the deeper historical reasons for improved workplace safety lie in an array of legal institutions developed by workers, employers, lawyers and lawmakers at the end of the 19th and beginning of the 20th centuries. American workers' organisations, for example, developed insurance benefits for their members and sought to exercise collective control to improve workplace safety. American lawyers developed modern accident law that created remedies against negligent employers.

Most importantly, drawing on reforms first implemented in Germany, England and France, workers' compensation statutes provided compensation for injured workers and created powerful incentives for employers to reduce accident tolls.

In the 1910s, American workplace injuries began to fall in virt ually every industry, except coal mining (where injury rates remained high for several decades).

Each of these innovations helped create an institutional infrastructure capable of dealing with the problem of work accidents _ and, indeed, with the wider social problems of disability, sickness, old age and unemployment.

Why? Because workplace safety and industrial accident compensation turned out to be critical early tests of western legal systems' administrative capacity to deal with the systemic problems of industrial free-market societies.

Of course, what worked for the US may not work for China. There are many different ways that legal systems can respond to occupational safety problems. The US, for example, never developed a powerful body of factory inspectors capable of providing effective enforcement of public safety standards.

Other western states, such as Germany, have successfully relied on centralised regulation and social insurance systems ever since Bismarck reformed the German law of accidents in the 1880s.

Unfortunately, China is obstructing all available paths to improved workplace safety. National safety standards and inspection regimes reflect the underlying pathologies of the Chinese state, in which lower-ranking officials report only positive information up the bureaucratic food chain.

At the same time, limits on workers' ability to organise independent unions have inhibited grassroots forms of safety monitoring. Even Chinese media have come under fire from officials for uncovering the kinds of workplace hazards that muckraking journalists revealed a century ago in the US.

Lawsuits are apparently increasingly common, but they are notoriously cumbersome, and judges are not independent from factory bosses.

Compensation awards to injured workers and their families are pitifully low and fail to give employers incentives to make their workplaces safe.

The lesson of the US and European experiences is that improving workplace safety depends on the development of basic rule-of-law standards in courts, workplaces and administrative bureaucracies.

Edicts and exhortations from the State Council are all well and good. But only effective legal institutions, not party fiat, will reduce Chinese workers' risk of death or injury on the job.

Fiona argues that many experts think that reproducing best regulatory practices from abroad is the best way to improve worker safety. Her work in Thailand suggests otherwise: reproducing such practices without regard for the economic, political and cultural context within which the regulator has to work has not been successful in the aftermath of the Kader fire (the worst factory fire in history). Here's Fiona's abstract for her paper on this:

Regulatory effectiveness remains a high priority but an elusive goal for many governments. Regulations change, often spurred by developments in other jurisdictions and often justified by the epithet global best practice. An underlying assumption of such reform is that best practice will provide an optimal outcome irrespective of the particular economic, political and cultural context within which the regulator has to work.

A means of understanding the unique contribution of place in moulding both regulatory reform and its enforcement is sorely needed in order to assess the worth of reforms within a particular context.

This paper explores the possibility of regulatory character as a means of understanding the importance of place and involves an understanding of culture, economic and political elements arranged schematically according to the dimensions of authority and social ordering. The paper outlines the concept and then uses it to understand the significance of regulatory reform and regulatory effectiveness in Thailand following the Kader Toy Factory Fire, the largest factory fire in history.