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After six month of negotiations, US fast food giant, KFC, has signed its first collective contract on the Chinese mainland with its employees in Shenyang, capital of Liaoning province.
The deal, along with a salary increase, comes amid rising tension between laborers and employers. Trade unions played a key role in the deal.
After a long wait, workers at KFC and Pizza Hut in Shenyang finally received the good news. They will sign a collective contract with their company, and receive a wage increase of at least 5%.
KFC Employee in Shengyang, said, "I'm so exited. Now I feel I have a stable job here."
The deal means that more than 2,000 workers at the 66 KFC and Pizza Hut outlets will get a minimum monthly wage of 900 yuan, a rise from the existing 700 yuan. Workers will also go on to receive an annual pay rise of 5 percent or more.
This is a satisfactory result for the workers, who have been fighting for the package since last December. Their salaries have long remained at the minimum level for the city. Their employer, the parent company Yum! Brands Inc, is the country's leading catering giant, with an annual profit hike of over 30%.
Last December the trade union for KFC workers in Shenyang invited the company discuss collective contracts. The talks focused on worker's salaries and welfare, and looked at ways to better protect worker's rights.
But after three months, discussions fell into stalemate.
Duan Yang, Vice Chairman of Shengyang Trade Union Federation, said, "The company's trade union drafted a collective contract, which did not specify the minimum wage level they wanted. This blocked the negotiation."
In late March, the Shenyang municipal trade union stepped in to carry out negotiations.
An agreement was finally reached to sign a collective contract, and adjust worker's wages in accordance with company profit.
The draft contract was approved by the company's labor delegation conference, and was signed by delegates from the company's administration and trade union.
Officials from Yum! China Division said they are pleased to see a collective contract achieved on the Chinese mainland.
The case has set an example, which other companies may follow.
Duan Yang, Vice Chairman of Shengyang Trade Union Federation, said, "Many foreign companies such as Wal-mart and McDonald's have now signed collective contracts to ensure workers' rights. Next we will push for more such contracts to be signed with foreign enterprises, as well as domestic private companies to protect the rights of laborers."
Statistic from the All China Federation of Trade Unions showed that by the end of last year, over 61 million workers across the country had signed collective wage contracts. With more efforts to get involved in wages negotiations, trade unions at different levels are playing a bigger role in resolving mounting labor tensions.