As part of plans to downsize its presence in China, Walmart decided to close down a store in Chengde city in the Hunan province in March 2014. The company did not respect its obligation to consult and notify workers 30 days in advance in accordance with the Labour Contract Law. Instead management argued that it had the agreement of the municipal authority.
Workers demanded negotiations over compensation packages and social security payments. Rather than negotiating with the union, management unsuccessfully attempted to speak to workers individually. Mediation meetings facilitated by the government were unsuccessful as the company refused to agree on compensation payments in violation of Chinese labour laws.
In a reply dated 10 April 2014 to the Hong Kong-based NGO Students and Scholars Against Corporate Misbehaviour (SACOM), Walmart Asia management stated, “We offered to meet with each affected individual one-by-one to discuss their options. We think this practice is certainly more private and more respectful. It gives them a chance to fully understand options and to ask any questions they might have.” This statement again reveals Walmart’s systematic policy to undermine trade unions by pressuring workers individually.
