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Chongqing Abolishes "Labor Contractors" to Protect Workers Rights

By RAN ZHENGICHONGQING|Aug 03,2022

Chongqing- The Chongqing Government recently announced the first move of a work plan to abolish “labor contractors” to protect workers’ rights and allow migrant workers to become employees of enterprises.  

On July 14, construction workers are processsing steel bars, Rongchang District, Chongqing.

On July 14, construction workers are processing steel bars in Rongchang District, Chongqing. (iChongqing file photo)

The labor contractor profession was born in the tide of migrant workers in China. As urban development requires many migrant workers and the surplus rural labor force is urgently needed in cities, labor contractors emerge to meet supply and demand. Contractors earn the difference between the construction company and migrant workers, which results in the contractor being the primary holder of migrant workers’ wages.  

According to data released by China’s National Bureau of Statistics in April, the country had 300 million migrant workers in 2021, with those over 50 accounting for 27.3%, or around 80 million.

However, with the development of urbanization in China, the traditional pattern of migrant workers has changed, and the past labor contractors have been unable to adapt to the economic growth. Specifically, the young generation born in the 1980s and 1990s has more career choices. They pay attention to the salary and treatment of the job and seek more job prospects. Therefore, young people are unwilling to work as migrant workers earning money through physical labor.  

In 2019, the Ministry of Housing and Urban-Rural Development issued measures for managing construction workers, which came into effect in March 2020.

Chongqing’s pilot program states that enterprises should sign labor contracts with construction workers, clarify their rights and obligations, and pay social insurance following the law, serving as the first move in China. The city also encourages enterprises to establish relatively stable labor relations with construction workers, where “labor contractors” will be gradually abolished and can be transformed into general contracting, professional contracting, and professional operating enterprises. Meanwhile, Chongqing supports enterprises in establishing salary incentive mechanisms and encourages high-skilled talent cultivation and employment in essential positions with high benefits.

Currently, 22 pilot enterprises have joined the first batch of the pilot, and the pilot will run from October 2022 to December 2025. In the first, second, and third years of the pilot program, the number of self-employed workers of the public contracting enterprise on the construction site should reach 10%, 25%, and 50%, respectively. By 2025, Chongqing will have more than 80% of construction workers with professional skills, of which more than 70% will be intermediate workers or above, and more than 40% of construction enterprises’ self-employed workers will be independent ones.  

This move will provide talent support to the high-quality development of the construction industry.

(Zhu Qinzhuo, as an intern, also contributed to this report.)

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