Ju Qian (Capable) Furniture Factory Report

Table of Contents

I. Factory Profile

Dongguan Ju Qian Furniture Corporation is a Taiwan-based company that is a part of the Tian He (天荷) Corporation. In 1989, the factory was established. After years of expansion, Ju Qian is now in possession of five branch factories. The total area of factory is approximately ten thousand square meters, employs 3,000 workers. The current company products are bathroom sets, living room sets, dining room sets, leisure room sets, reading room sets, and a variety of other merchandise. The products are mainly sold to the United States and Europe. Its primary clients are Ikea and Conforama.

Out of five factories, Factory number one, two, three and four are located in the same area, and the fifth factory is approximately one thousand meters away from the main factory site. Factory number one, two and five mainly produce metal parts of furniture items, Factory number three produces wooden products, and Factory number four produces glass or plastic parts. Jun Qian factory first packages the parts, and then exports the packages to foreign countries. The products are mostly exported to American, European, Japanese, and Korean markets.

English name: Capable (Dongguan) Furniture Co. Ltd.

Company address: Guangdong Province, Dongguan City, Shi Jie Township, next to Si Jia Oil Depot  (广东省东莞市石碣镇四甲加油站旁)

II. Summary of Violations

I. Workers are not given the legally mandated rest time and holiday vacation
II. Compulsory overtime and inadequate compensation for overtime work
III. Workers work six days a week
IV. Work related injury insurance is not purchased for workers as required by law
V. One day of rest day during the peak season
VI. Skilled workers are not allowed to resign during peak season
VII. Verbal and physical harassment from managers and staff
VIII. Tiny dorm room housing ten workers
IX. Work environment does not meet safety regulations

III. Labor Contract

A large percentage of workers are recruited from local recruitment offices and through advertisements posted on the Ju Qian factory gate. Applicants are required to provide a valid Identification card, and go to an assigned local clinic for basic health examination. The factory generally hires workers who passed the health examination. During the slow season, factory usually stops recruiting. During the peak season, however, due to lack of workers enrolled in addition of average benefits offered which makes the job less attracting, the factory sets the work qualification including age requirement, at a very low standard. Even applicants around the age 40 have a very easy time to be enrolled in the factory.

Upon recruitment, workers are required to sign a document agreeing to work under probation (work agreement is targeting employees offered with monthly salary). The contract stipulates that the probationary period is three months. During the three months, workers under probation are required to work five days a week.

The Probationary Work Agreement contains the followings:

Regular Work Schedule

Monday-Friday 8 am to 12 pm
Lunch break 12 pm – 1 pm
Work 1 pm to 5 pm
Saturday Fixed day of overtime
Sunday Off

Ju Qian states that, under the policy, it preserves the rights to arrange probationary overtime to workers under probation. The work nature is up to each worker’s sense of responsibility, the ultimate goal is to finish appointed task.

Benefits during probationary work are minimum wage plus a subsidy for full attendance, which is approximately ¥900 RMB/month. On the other hand, the factory imposes fines or immediate dismissal on the probationary workers for gambling, quarreling, fist fighting, going on strike etc.

Image 5: Jun Qian’s probation agreement

Jun Qian factory offers skilled workers wage calculated under a piece-rate system, and these workers are hired automatically without going through the probation. Thus, the more pieces these workers produce, the more they earn. Since this group of workers is the factory’s main force of production, in order to attract the workers in staying during slow season, the factory offers the skilled workers a contract of benefits upon employment (The factory states that this document is equivalent to the contract).

The contract policy states, when the total piece-rate wage is higher than the total hourly rate wage, the factory will use piece-rate wage to calculate the payroll, and vise versa. However, if a worker does not complete the task, then his/her salary will be calculated by the system that offers lower wage. Moreover, same punishment will be imposed if a worker is absence without noticing the factory. In addition, one unnoticed absence day is a warning, and three warnings lead to unconditional dismissal.

Piece-rate wage is applied to workers who have workdays less than or equal to 26 days in a month. On the 10th of every month, Jun Qian posts individual workers’ wage statement on the bulletin board in each department. Workers are allowed to view the board and go to the management department for any questions relating to wages. If the workers use protesting as a way of increasing work benefits, Ju Qian will treat the problem as unnoticed absence.

Ju Qian’s policy states, an hourly wage worker earns ¥4.12/hour, regardless if it is regular hour or overtime. Moreover, piece-rate pay is calculated by the worker’s daily output times the piece rate.

Under the factory-employee contract, Ju Qian clearly states that hourly waged workers are paid ¥4.12/hour, same as the minimum wage imposed by the Dongguan City. However, Ju Qian also states that overtime rate is ¥4.12/hour as well, which clearly violates the labor law. Under the labor law, worker’s regular overtime rate should be 1.5 times more than the regular wage, rest day overtime rate needs to be twice as much as the regular wage, and vacation day overtime should be three times more than the regular wage.

Furthermore, during the peak season, there is no time given for a regular rest day. Employees report that there is no overtime only when electrical power outage occurs, and sometimes when there are urgent orders that need to be completed, the factory will activate its power generators for overtime shift.

IV. Work Schedule

In the contract, it states that a regular work schedule is five days per week, and eight hours per workday. Regarding to employee vacation, the factory policy states that the most vacation days taken in one month cannot exceed four days. In practice, however, this kind of vacation does not exist for employees

Due to the large area of factory and amount of workers, Ju Qian’s regular work schedule is set up as such:

8 am – 12 pm work
12 pm – 1 pm rest
1 pm – 5 pm work
5 pm – 6 pm rest
7 pm – 8 pm work

Ju Qian’s peak season work schedule:

8 am – 12 pm  work
12 pm – 1 pm rest
1 pm – 5 pm work
5 pm – 6 pm rest
7 pm – 11 pm work

The factory has four sectors that are concentrated, and one sector is apart from the four. Some workers can get off work ten minutes early or late, thus separates workers’ lunch and dinnertime.
Every morning and after dinnertime, workers are required to gather by their departments for a twenty-minute exercise and few safety announcements.

During the course of investigation, a forklift operator from factory number four says:
 Our factory offers very little break, there’s generally no break time during the peak season. Workers have to ask for leave if they want to rest, and the days off can only be up to four days within one month. When the factory is busy, workers generally cannot ask for leave. The only break time is only when power failure occurs. In terms of power failure however, sometimes Ju Qian would use its back-up generators in order to maintain production. Furthermore, many departments have two shifts, workers often are required to work two to three hours of overtime daily. 

According to the factory gate’s personnel office, its recruitment policy clearly states that when the factory is busy there is no rest time, and employees must follow the factory time schedule otherwise, it would be counted as unnoticed leave. It essentially became a reason why Ju Qian is having a difficult time recruiting workers.

In addition, in order to have a better understanding about the workers’ work environment, we conducted interviews questioning about the work procedures at Ju Qiang,

Q: What are the work procedures for producing furniture?
A: This factory produces steel and wood furniture. The steps for steel furniture production are the followings: Shaping, bending, welding, polishing, painting, searing, packing etc. The steps for producing wood furniture are collecting materials, opening material (kai liao), sorting, spreading ash (shang hui), polishing, blowing (chui hui), trimming, taping, and sorting sand (ping sha).

Q: Can you briefly describe the number of workers in each department/workshop?
A: The polishing workshop has about 30 workers, carpentering workshop has about 200 workers, and other workshops have workers ranging from 150 to 200. However, I don’t know the actual amount of workers in the factory.

Q: What is the production rate of the factory?
A: The factory does not produce assembled products. The packaging department only packages the furniture parts, and the parts are assembled after being exported to the destination. There are large package and small package, the department can assemble large package at 80-100 package/hour, and the small package usually can be produced at the rate of 120-150 package/hour. In addition, workers are responsible to cut materials every three second.

V. Work Benefits and Remuneration

Upon entering the factory as employees, the workers are only required to provide a health exam certificate, and the factory provides two sets of work uniforms with no charge.

There are three ways to calculate workers’ pay at Ju Qian, hourly, piece-rate, and monthly. Hourly and piece-rate systems are the most common ways that regular workers are paid; this group of workers’ work condition can also be determined by the piece-rate system. Hourly wage system is to ensure the workers’ base wage. Currently, Ju Qian’s base pay is ¥1200 RMB/month. If a worker’s monthyl piece-rate is under ¥1200 RMB/month, the factory will still offers ¥1200 RMB to the worker. However, if a worker continuously cannot meet the requirements for three months, then he/she will be fired.

Monthly salary is usually offered to employees at the management level, forklift operators, production managers, quality control managers etc. These workers’ work performance cannot be determined by piece-rate system, thus their salary is generally calculated by monthly rate. In addition, the probationary period salary for these employees is ¥ 900/month.

Ju Qian’s peak season is usually from January to April, and November and December, all other times are the slow season.

During the slow season, monthly paid workers receive approximately ¥1000 RMB. Piece-rate workers receive about ¥900 RMB. During the busy season, monthly paid workers’ pay remains the same, however the piece-rate workers’ salary are usually around ¥1700 RMB.

There is work evaluation in January, April, and September. A worker with good record can receive monthly bonus ranging from ¥30 to ¥200 RMB; it mainly depends on the relationship between the worker and the management department.

The factory enrolls workers in work-related injury insurance and pension. If an employee is enrolled in work-related injury insurance, a ¥70 -¥80 RMB will be deducted from his/her salary. The factory adopts a voluntarily enrolment system, the factory does not voluntarily offers to enroll workers in any kind of insurance. Many employees fear for their unstable financial status after purchasing insurance. Thus, not many workers have insurance.

Ju Qian provides workers with a monthly ¥50 RMB award for full work attendance. Monthly paid workers are offered with a monthly living subsidy of ¥180 RMB. The factory has year-end bonuses, and longer working time leads to more money. A regular employee’s year-end bonus is usually calculated by the months worked within the year. The total amount of bonus is calculated by the total work month * ¥ 20 RMB. Night shift workers receive a subsidy of ¥2 RMB for food costs.

Female workers have a three-month maternity leave. During vacation, Ju Qian offers workers base pay. Lunar New Year, May Day, and Nation Day, workers have three days of paid vacation, and one day for New Year’s Day.  (Paid based on the hourly wages standard).

It is very difficult for workers to leave or resign during the peak season; it usually requires a 30-day prior notice. If the position is unique, the factory usually will not approve requests. Workers often have to wait until the factory hires a worker with the same qualifications in order to be permitted to leave.

VI. Meal and Accommodation

Workers who reside in the factory dormitory are required to pay a ¥80 RMB/month accommodation fee. The factory provides monthly salary workers a subsidy of ¥80 RMB /month for accommodation expenses. In terms of meal, employees who eat at the factory only have to pay for what they eat. A meal is between ¥0.8 – ¥3 RMB. Workers state that the meals are standard.

A dormitory room usually houses around 10 workers, equipped with two electric fans, a toilet and a bathroom. Each floor has a place providing hot water.

VII. Safety Protection

The factory will enroll employees in work-related injury insurance. When new workers arrive on their first day, they will be required to have a health examination. On the second day, they are assigned to a dormitory room. The third day, workers are gathered to learn factory policy and other safety and training work.

Ju Qian generally assigns a skilled technician to repair and inspect the machines periodically.  The factory workshop is a one story steel building, the ceiling is considerably low, and there are few electric fans. Workers often will quarrel over an electric fan. The factory is currently in the process of considering on installing air conditioning in certain sections.

Every section of the workshop has installed a large polluted air ventilation system that expels dust, dirt and gases from the workspace. In the polishing sector, the factory provides workers with safety glasses and respirators. However, there are still workers without proper safety equipment. In Factory number five, the lumber workers are only equipped with gloves and are not provided with dust-proof respirators.

VIII. Fines and Other Issues

The factory generally does not impose a system of fines. However, there are warnings, minor violations, major violations etc. Regular workers with three major violations will be immediately dismissed

Ju Qian has no trade union, nor any kind of worker organization. Workers with problems or objections generally would be able to express themselves at the factory’s morning, evening, or overtime meetings.

During the course of the investigation, Ju Qian gave workers four days of vacation leave for Lunar New Year. Some departments demanded workers who work during the daytime to continue to work at night continuously for approximately 24 hours. Many employees were unwilling to comply with the overtime. However, in the end they were forced to work.

Workers are unlikely to be searched as they enter and leave the factory. However, if they do not take their work seriously, they will be lectured and verbally abused by the management department.