Massive strike at IBM factory in China over Lenovo server deal

Massive strike at IBM factory in China over Lenovo server deal

Summary: More than 1,000 IBM workers at an affected server division demanded proper compensation and refused to be "sold" to Lenovo.



Courtesy of

On 3 March 2014, more than 1,000 workers at the server-making IBM ISTC factory in Shenzhen, Guangdong, staged strikes and protested against the company's lump sum severance package.

According to a Shenzhen TV channel’s report published on 4 March, IBM ISTC, one of the strategic manufacturing bases of IBM global integrated supply chain, laid out two choices for the workers: either "willingly” leave IBM before March 12 with compensation plus an extra 6,000 yuan, or stay and "automatically" become Lenovo employees. In the latter scenario, the worker get to keep the same amount of compensation but without the 6,000 yuan. Neither plan is in accordance with the labour laws in China, according to the report.

Workers were chanting and marching within the factory compound and are accusing IBM for unilaterally terminating working contracts without proper compensation, which they expect to be: Average monthly salary × years of service × 2 + one month of salary.

According to the TV report, angry workers also criticized the excessive working hours at IBM, while demanded the company provide immediate Occupational Health and Safety (OHS) checkups and extra compensation for the female workers who were pregnant or are nursing a baby.

"Many of us work from 8:00am to 11:00pm for a consecutive 15 days! IBM must provide us with OHS checkups!" said a worker at the scene of the strike.

Workers have handed a letter of grievances to the management and are now waiting for replies while continuing the strikes.

On January 23, 2014, Lenovo announced that it had purchased IBM's X86 server business for US$2.3 billion. The deal, said Lenovo's CEO Yang Yuanqing in another report by NetEase, brings Lenovo an extra US$5 billion in revenue, and expand its X86 server market share from the 6th to the 3rd in the world.

Topics: Lenovo, IBM, Servers, China, IT Employment

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  • Wow!

    17 hour days for two weeks+ straight? That sounds pretty darn bad.
    • The Great Unknowns:

      ""Many of us work from 8:00am to 11:00pm for a consecutive 15 days! "

      1) How many is "Many"?

      2) How many are compulsory?

      3) How many are Overtime?

      4) How many days off ?

      5) Working conditions?

      Five unknowns
  • the unions are scourge of the world

    these lazy an d over entitled bums don't want to work hard and torment great companies with their anti-business protest!
    LlNUX Geek
    • Yep

      They'll bring China down just like the U.S.

      I will NEVER forget my first union experience. I was 17, from a hard-working German family and it was my first "real" job as summer help at the factory of my father's business. Not even two steps out of the "Personnel" office, the union steward leading me to my station opened with "First, don't work too hard - you don't want to push the others [on the line]."
      • German labor unions

        Are very strong. In fact, that was a key point of debate in the Volkswagen-UAW vote in Tennessee in the past few weeks. The labor union representing German workers have a seat on the German equivalent of the Board of Directors, help shape corporate strategy, etc. It's a strong, active voice. I'm not weighing in as "good" or "bad"; it just is what it is.
      • Curiously enough...

        ...I was a member of a union during most of my time in college (among other things, it meant I had my own health insurance and made more money than I would have otherwise, which was helpful) and I don't think I even knew who my shop steward was. Certainly the union said nothing to me about how I was supposed to do my job.

        This was in a right to work state, but even so.
        John L. Ries
    • Ding Zedong

      They should move to a Communist country where workers are valued!
      Robert Hahn
      • Communist country where workers are valued!

        You do realize that this article is about a communist country's workers, right?

        Do they seemed valued to you?

        Unions at one time had a place and did good, today they prompt a lazy ineffective work force.
    • I can only assume you are being facetious

      because, despite being obviously oxymoronic (how is a worker doing 18 hours/day not working 'hard enough'??) it simply creates an impression that you are yet another entitled person who views their worth in purely economic terms. One of life's losers, in other words.

      Surely you didn't want to create this impression???
  • yeah, whatever

    obviously you guys are either stooges for the company or have never worked long enough to have a legitimate grievance. I have avoided excessive union-rules as a non-union employee, but know full well that most of the reasons that employees join unions is that without them, employers have all of the bargaining power and historically had abused it. Granted some unions also abuse their power, but they also provide benefits. Abuse by the corporation, would not provide nearly so many. You either pay Peter or pay Paul, but one of them looks out for your backside, and the other just sells it for profit.
    • Perhaps you haven't worked long

      I work hard to EARN my money and I negotiate my compensation and work conditions for myself. While there are certainly many hard-working union employees, there are just as many "users" that not only don't work hard, but negatively impact the good employees. I just don't believe in supporting the weakest links in the chain as that does not help me or the company.
      • I have worked long and hard

        I have worked long and hard. I am extremely skilled and have built many many things for many companies. I am about to start a new project using very advanced technologies that few know. I have never been asked about what my working conditions would be or what my compensation was going to be. I was told. I know that this is the way it is for pretty much everyone I know... So pardon me if I don't believe you. You are just wretching.
    • Afer a layoff

      In 1987, after three years there, I was laid off from Massachusetts computer firm Wang Laboratories (my first civilian job after 21 years in the military), and ushered to the door. There I saw elderly Portugese-speaking women from an assembly line being ushered without explanation into the snow covered parking lot when they came back from lunch, despite having to wait until 5PM for their adult children to get off work elsewhere and pick them up.

      Later, I confronted the HR manager running the clusterf*** (a military technical term); "This is what gets you a Union," I told him.

      He said the first thing he thought: "I hope not! That'd raise our direct labor costs 17 percent!"

      "Yeah," I replied "You'd DESERVE it."

      That firm no longer exists.
  • I don't know...

    ...what the labor laws in China are, concerning this issue, but whatever they are, that's all IBM must do. Beyond that, no one is entitled to anything else.

    I think the employees probably feel that they're more likely to win concessions from IBM than from a Chinese company, who not only knows the local laws but also exactly how to work around them.
    • You do have to get people to work for you

      Slavery is illegal, even in China. We'll see what happens, but I don't think this is a sanctioned strike by an officially recognized union (I'm under the distinct impression that all legal unions in mainland China are controlled by the Chinese Communist Party). If that's the case, I would expect the Chinese government to intervene.

      Interesting times.
      John L. Ries
  • Key passage for me

    "Angry workers also criticized the excessive working hours at IBM". Yep, sounds like Big Blue to me.
  • mixing not good here.

    Mix business with grievances not a good idea. First things first. Let's concentrate on the 2 options. The hours has no0thing to do with this strike. Looks to me that's easy. Do you want to stay , leave or quit. That's the big question here.
  • Very different from Foxconn case!

    These people are very different from the ones that work on Apple factories.
  • Man bites dog

    I'm under the impression that there are no independent trade unions in mainland China; rather they're strictly controlled by the Communist Party.
    John L. Ries
    • Come to think of it...

      ...there's nothing in the article that indicates that the strikers are affiliated with a union.

      Wildcat strike? Solidarity started that way.
      John L. Ries