Workers hold U.S. executive hostage at Beijing plant

Calum MacLeod and Doug Stanglin | USA TODAY

Show Caption Hide Caption U.S. exec says he's being held captive in Beijing factory An American executive claimed he had been held hostage for four days at his medical supply plant in Beijing by scores of workers demanding severance packages. The US State Department says it is actively monitoring the situation. (June 24)

BEIJING -- A Florida-based executive, holed up in an office and wearing the same clothes for five straight days, says he feels like "a trapped animal" after being held hostage by scores of employees in a labor dispute at his medical supply plant in the Beijing suburbs.

Chip Starnes, 42, co-owner and president of Specialty Medical Supplies, based in Coral Gables, Fla., says he arrived in Beijing last Tuesday to finalize the layoff of 30 people from the plant's plastic division, which is being shut down and moved to Mumbai, India.

Rising costs, including a minimum wage, have made China more expensive in recent years. The consulting firm AlixPartners estimated in an April 2013 study that by 2015 the cost of outsourcing manufacturing to China will be equal to the cost of manufacturing in the U.S.

Starnes tells the Associated Press that some of those being laid off had worked at the plant for nine years and are getting "pretty nice" compensation packages.

But, he says, about 100 workers who apparently thought -- erroneously -- that they were also being laid off have demanded similar compensation packages, despite his attempts to make it clear the rest of the plant is not being closed.

Starnes claims local officials had visited the 10-year-old plant on the outskirts of Beijing and coerced him into signing agreements Saturday to meet those workers' demands. The workers were expecting wire transfers by Tuesday, Starnes says.

In the meantime, he says, about 80 workers have blocked every exit 24 hours a day and deprived him of sleep by shining bright lights on his office and banging on windows. Four uniformed local police are at the scene to maintain order.

"I feel like a trapped animal," Starnes told The Associated Press on Monday from his first-floor office window, while clutching the window's bars. "I think it's inhumane what is going on right now. I have been in this area for 10 years and created a lot of jobs and I would never have thought in my wildest imagination something like this would happen."

After a delay, representatives from the U.S. Embassy have gotten inside. Embassy spokesman Nolan Barkhouse says the two sides were on the verge of an agreement and that Starnes would have access to his attorneys.

Labor disputes are common in China, where blue-collar workers sometimes struggle to receive full pay and benefits, and labor unions are kept toothless to avoid any potential opposition to Communist Party rule. But foreign investors are rarely so embroiled in physical disputes.

CNBC reports that Chi Lixiang, the head of Communist Party-controlled Union Rights Department, laughed at suggestions that Starnes is a hostage.

"What do you mean holding him hostage? … Our representatives said already that they are all female employees so how can they hold a well-built man hostage? You must be joking," he said, according to CNBC.

Contributing: Associated Press