Wal­mart has suc­ceed­ed in meet­ing the Chi­nese government’s demands that the com­pa­ny allow unions to be for­mal­ly estab­lished, but this has not trans­lat­ed into any effec­tive col­lec­tive bar­gain­ing pow­er for some 107,000 work­ers at the company’s 411 Chi­nese stores, says Han Dong­fang, Exec­u­tive Direc­tor of the Hong Kong-based Chi­na Labour Bul­letin . Han and oth­er experts spoke June 15 at an ​“Orga­niz­ing the Work­ers of Wal­mart: From Ben­tonville to Bei­jing” con­fer­ence spon­sored by the Albert Shanker Insti­tute .

Almost 10 years after Wal­mart was forced to accept union­iza­tion of its stores in Chi­na, the U.S.-based mer­chan­dis­ing giant con­tin­ues to deny basic col­lec­tive bar­gain­ing rights to its Chi­nese retail work­ers, accord­ing to two union experts speak­ing last week at a con­fer­ence on Wal­mart and labor in Wash­ing­ton, D.C.

Wal-Mart’s Chi­na sub­sidiaries exer­cise effec­tive con­trol over a ​“yel­low union,” he says, explain­ing that this ter­mi­nol­o­gy is used in Asia to describe an employ­er-dom­i­nat­ed union that pre­vents the estab­lish­ment of an inde­pen­dent union con­trolled by work­ers. As a result, Wal­mart work­ers in Chi­na are in much the same legal posi­tion rel­a­tive to their employ­er as non-union employ­ees in the Unit­ed States or else­where, Han says.

“There is no right to bar­gain” col­lec­tive­ly, Han asserted.

The Chi­nese Wal­mart unions were not orig­i­nal­ly ​“orga­nized” in any way that would be rec­og­niz­able to most Amer­i­cans. The All-Chi­na Fed­er­a­tion of Trade Unions (ACF­TU), the country’s only legal labor orga­ni­za­tion, most­ly ignored Wal­mart when it began open­ing stores in the coun­try in 1996. But as the num­ber of stores mul­ti­plied, ACF­TU began mak­ing over­tures, only ​“to have the door slammed in their face,” Han said.

This cre­at­ed anger among Com­mu­nist Par­ty offi­cials, and in 2006 Par­ty boss Hu Jin­tao ordered the union­iza­tion of many for­eign-owned com­pa­nies in Chi­na, includ­ing Wal­mart. Even the rigid­ly anti-union Wal­mart could not defy the pow­er­ful Hu, and ACF­TU branch­es were quick­ly estab­lished at Wal­mart stores.

But the cre­ation of Wal­mart work­ers unions on a store-by-store basis was more of a bureau­crat­ic process than a U.S. style-orga­niz­ing cam­paign. Typ­i­cal­ly, Wal­mart man­agers receive a notice from ACT­FU that the store is being union­ized, and the process is rapid­ly com­plet­ed with an exchange of paper­work, accord­ing to Han. Union offi­cers are usu­al­ly cho­sen from among store man­agers – some­times there are elec­tions, but often there are not.

Instead of union dues paid by the work­ers, Wal­mart makes a pay­ment to ACT­FU equal to two per­cent of the store pay­roll, as is com­mon prac­tice for for­eign com­pa­nies with union­ized oper­a­tions in Chi­na, Han says. And there is no pub­licly avail­able col­lec­tive bar­gain­ing agree­ment that gov­erns wages and work­ing con­di­tions: Instead, each indi­vid­ual work­er is pro­vid­ed a con­tract labor doc­u­ment that spec­i­fies the wages.

Han is cor­rect that Walmart’s Chi­nese unions are doing a poor job of rep­re­sent­ing work­ers, says Duan Li, a lawyer and founder of Guang­dong Lao Wei Law Firm, a work­ers’ advo­ca­cy coop­er­a­tive. The firm is cur­rent­ly rep­re­sent­ing more than 100 Wal­mart work­ers in dis­putes with com­pa­ny, he told atten­dees at the Shanker Insti­tute conference.

Speak­ing through an inter­preter, Duan said that ​“work­ers have a dif­fi­cult time car­ry­ing out col­lec­tive bar­gain­ing. … Union lead­ers are part of man­age­ment.” Store man­agers have the ​“abil­i­ty to retal­i­ate against work­ers” by dis­miss­ing employ­ees who assert their labor rights, accord­ing to Duan. Some 80 per­cent of Lao Wei firm’s Wal­mart cas­es involve ille­gal or improp­er dis­missals, he says.

Chi­na Labour Bul­letin report­ed last year on a large num­ber of ille­gal or improp­er Wal­mart dis­missals, Han adds. In one high-pro­file inci­dent, a Wal­mart store in the city of Chengde was closed abrupt­ly, prompt­ing pub­lic protests from the dis­placed work­ers. The protests end­ed only when pick­eters were car­ried off by the local police. Wal­mart qui­et­ly agreed to arbi­trate the wage com­plaints of the fired work­ers. Han char­ac­ter­ized these protests as a ​“strike” against Wal­mart — and one of the few instances where local union offi­cials agi­tat­ed on behalf of the rank-and-file workers.

Labor activists are hope­ful that the Chengde strike is a sign that local ACT­FU offi­cials are becom­ing more respon­sive to the day-to-day con­cerns of Wal­mart work­ers. Han reports there is a ris­ing tide of rank-and-file work­er activism in var­ied indus­tries through­out Chi­na (a top­ic Michelle Chen wrote about for Work­ing In These Times last year), and Wal­mart employ­ees have the poten­tial to ben­e­fit. Duan adds that Walmart’s Chi­nese work­ers are increas­ing­ly using social media net­works across wide­ly scat­tered stores to share infor­ma­tion and pro­vide mutu­al support.

Nel­son Licht­en­stein, a labor his­to­ri­an and author of the influ­en­tial 2009 book The Retail Rev­o­lu­tion: How Wal-Mart Cre­at­ed a Brave New World of Busi­ness, com­ment­ed that Walmart’s invest­ment in Chi­nese retail­ing appears trou­bled, although there is no evi­dence that these trou­bles have their ori­gins in labor issues. He not­ed that Wal­mart has only about 400 stores in Chi­na, even though it has been active in the coun­ty for almost 20 years. That com­pares to 4,540 stores in the Unit­ed States, and 11,488 world­wide, accord­ing to the offi­cial Wal­mart website.

The sit­u­a­tion remains mud­dy for out­siders, Licht­en­stein admits, as Wal­mart con­tin­ues to close stores in Chi­na, but at the same time announces plans for 115 more by the end of 2017.

What is clear is that the retail­ing part of Walmart’s busi­ness in Chi­na is rel­a­tive­ly small com­pared its huge inter­est in pro­duc­ing low-cost goods for sale in the U.S. and oth­er high­er-income coun­tries, Licht­en­stein says. Walmart’s mar­ket pow­er is such that it can essen­tial­ly dic­tate prices to Chi­nese man­u­fac­tur­ers of con­sumer goods, and this pow­er is much more impor­tant to the company’s glob­al prof­itabil­i­ty than the Chi­nese store oper­a­tions. The com­pa­ny has an enor­mous inter­est in depress­ing labor costs through­out the Chi­nese econ­o­my, he says.

Kevin Slat­en, Pro­gram Direc­tor at New York-based Chi­na Labor Watch, agrees that Walmart’s Chi­nese man­u­fac­tur­ing inter­ests far out­weigh any poten­tial for retail­ing prof­its. Com­ment­ing a few days after the Shanker Insti­tute con­fer­ence, he told In These Times: ​“Where­as Wal-Mart’s retail side in Chi­na has made a mod­er­ate foot­print, its man­u­fac­tur­ing sup­ply chain has for many years con­trolled a huge net­work of thou­sands of con­tract fac­to­ries mak­ing goods for Wal-Mart stores around the world. The com­pa­ny uses low-cost plants with poor work­ing con­di­tions, com­pet­ing them off one anoth­er. The down­ward pres­sure of this dynam­ic on Chi­na’s labor stan­dards is prob­a­bly greater than the impact of Wal-Mart’s retail stores.”

A spokesper­son for Walmart’s inter­na­tion­al cor­po­rate affairs depart­ment at the company’s Ben­tonville, Arkansas head­quar­ters declined a request from In These Times for a tele­phone inter­view with an exec­u­tive qual­i­fied to com­ment on Walmart’s union issues in Chi­na. She also refused to respond to a series of writ­ten ques­tions seek­ing con­fir­ma­tion or clar­i­fi­ca­tion of the remarks of Han and Duan.