IBM fires 19 in labor dispute

Updated: 2014-03-10 22:03

By Chen Hong in Shenzhen (

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Tensions rose at an IBM factory in Shenzhen as 19 workers were fired on Monday, ostensibly for violating company policies, according to one of the strikers.

More than 1,000 workers at IBM Systems Technology Co (ISTC), the server-making unit of IBM Corp, spontaneously walked off the job on March 3 to protest the factory's offer of severance packages ahead of a scheduled acquisition by personal computer giant Lenovo later this year.

"The factory terminated the labor contracts of 19 worker representatives. We were fired immediately and got no compensation. It's a sort of revenge," said Wen Yong, who has been working at the factory for 10 years.

The fired employees were said to have violated company policies by causing a production shutdown, Wen said.

Most strikers remained sober and non-violent as the strike entered its eighth day. But some of the workers staged sit-in protests on Monday evening.

The strike was triggered when workers at ISTC were notified on March 3 to that they had one week to decide whether to resign or stay on as Lenovo employees. The factory offered a 6,000 yuan ($980) severance payment for workers who chose to leave before March 7.

On Sunday, in an apparent sign of compromise, ISTC management said that workers who are willing to sign contracts with Lenovo before March 12 would get an extra 30,000 yuan bonus, half of which would be paid by the end of April and the rest in the first month after Lenovo takes the reins.

But workers who accept the new plan are required to resume production immediately and to ensure normal operations and good product quality.

According to Wen, about 100 of the strikers signed the contracts, but the rest continued to "protect their rights and fight for their benefits".

Apart from the dissatisfaction about the severance packages, many of the strikers expressed anger about what they said was the company's rude and abrupt decision to proceed without seeking their input, forcing them to make a life-changing choice on short notice.

"I have been working for the factory for 20 years and felt it's a part of my life. But obviously the company doesn't think the same way," said Hou Hongbo.

The district government, local human resources managers and trade unions are working hard to mediate between the IBM management and the workers, said Wen Xianqing, a press official at Futian district government.

One official, who asked not to be identified, said IBM was too rough in its handling of the workers, though its actions are legal.

"The company is backed by a powerful legal team, so its move is in line with Chinese laws, but the decision is merciless to the workers," the official said.

Lawyer Li Jianyong called the workers "unreasonably troublesome", and said they would hurt the healthy development of the companies.

"IBM is offering much more than what the law requires to the workers. They have no reason to strike and suspend production," he said.

In January, Lenovo, the world's biggest producer of personal computers, said it would buy IBM's x86 server unit for $2.3 billion. The deal is expected to close in the fourth quarter of 2014, according to Lenovo Chief Financial Officer Wong Wai-ming.