(Bloomberg) — China has issued its most comprehensive warning yet against the excessive work culture permeating the country’s largest companies, using real and richly detailed court cases to counter a growing backlash against the punitive demands of the private sector. to grab.
The Supreme Court and the Department of Human Resources and Social Security released a lengthy essay on labor violations and unreasonable overtime on Friday, labeled “996” for the common practice of working from 9 a.m. to 9 p.m. six days a week. It outlined 10 cases — including but not limited to the tech industry — where workers were forced to work extra hours or put at risk.
In one case, an unidentified tech company asked employees to sign agreements not to pay overtime, which the court ruled illegal. In another case, a media worker passed out in the office restroom at 5:30 a.m. before dying of heart failure. The court ruled that the death was work-related and asked the company to pay the victim’s family about 400,000 yuan ($61,710).
“We see a strong trend to encourage people to use the legal system to go after technology companies. We think civil lawsuits will increase,” said Kendra Schaefer, head of digital research at consultancy Trivium China. But the question remains, she adds, “whether this is a signal that regulators are turning their attention to this social problem.”
China’s increasingly profitable tech giants are grappling with public outcry over their grueling schedules, a response fueled by a growing number of social media complaints and even deaths. Tech billionaires, from the founder of Alibaba Group Holding Ltd. Jack Ma to JD.com Inc. chief Richard Liu, have long endorsed the practice as necessary to survive in a highly competitive industry – and the key to accumulating personal wealth. China’s tech workers are under tremendous pressure to work long hours to meet demanding deadlines, while often lacking a clear legal recourse — unlike Silicon Valley, where the likes of Google dangle incentives like lavish cafeterias to motivate employees.
“To be able to work 996 is an enormous happiness,” Ma once said. “If you want to work at Alibaba, you have to be willing to work 12 hours a day. Why else would you bother to participate?”
Read more: China is losing a tech generation as its big payout promise fades
But the tide is turning. Xi Jinping’s government has launched a campaign to curb the growing influence of the country’s largest companies, while urging the private sector to share the wealth. The online criticism adds to the challenges for tech companies that already have heightened control over their treatment of workers and endemic problems such as forced drinking during official functions.
Meanwhile, Xi’s government is trying to boost the country’s domestic consumption and birth rate — a brutal work culture could get in the way of its overarching goals.
The ‘996’ regime is especially prevalent in the sprawling tech sector, where foot soldiers began protesting after the promise of massive payouts through stock options faded along with the market wiped out. It dates back years: In 2019, a group of Chinese programmers took to GitHub to ban startups accused of abusing employees by using their open-source code.
The controversy culminated earlier this year with the deaths of two employees at the hard-charging e-commerce app Pinduoduo Inc. A woman collapsed while walking home with colleagues at 1:30 a.m. and could not be resuscitated, while another employee committed suicide.
Read more: Employee suicide raises concern over Pinduoduo’s work practices
Internet companies, including ByteDance Ltd. and Kuaishou Technology, have taken the first steps in recent months to reduce working hours. The two short-video giants, for their part, have scrapped an alternating system where employees take only one day off a week every two weeks.
“It’s a good sign that the Supreme Court is finally paying attention. This is as much about politics as it is about the rule of law, given the recent crackdown on companies like Alibaba and Meituan,” said Suji Yan, a startup founder who helped set up the GitHub campaign.
Yan said he tried to help tech workers file labor lawsuits or complaints against their employers in 2019, but received a lukewarm response from courts and regulators.
While Chinese labor laws require extra pay for overtime outside of an 8-hour workday, employers have found solutions and the enforcement of such rules has long been under discussion. In one case published Friday by the Supreme Court, an undisclosed internet company told employees it only counts overtime from 9 p.m. — not before. In another case, an unidentified pharmaceutical company said all overtime paid required a manager’s signature.
China’s Human Resources Ministry and the courts are now striving to develop guidelines to resolve future labor disputes, according to Friday’s report.
“The problems of overtime in some industries and companies have come to the attention of the public,” the court said in its statement. “By law, employees are entitled to corresponding allowances and rest periods or vacations. It is the duty of employers to comply with the national regulations on working hours. Overtime can easily lead to labor disputes, affect the employee-employer relationship and social stability.”
(Updates with comments and details from the 4th paragraph)
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