LABOR CONTRACT LAW: NATIONAL PEOPLE's

UNCLAS BEIJING 000390 SIPDIS SIPDIS SENSITIVE DEPT PASS USTR FOR KARESH, A. ROSENBERG, CELICO LABOR FOR ILAB TREAS FOR OASIA/ISA-CUSHMAN USDOC FOR 4420/ITA/MAC/MCQUEEN AND DAS KASOFF GENEVA FOR CHAMBERLIN E.O. 12958: N/A TAGS: ELAB EINV PGOV CH SUBJECT: LABOR CONTRACT LAW: NATIONAL PEOPLE's CONGRESS RELEASES SECOND DRAFT REF: A) 06 BEIJING 24304 B) 06 BEIJING 9677 ¶1. (U) On December 25, 2006, the National People's Congress (NPC) debated a new, second draft of the Labor Contract Law (LCL). The LCL is intended to complement existing labor legislation and specifically address prevalent abuses of workers? rights. The second draft is substantially different from the first draft issued in March 2006. According to the NPC website, the new draft reflects the issues raised in over 190,000 responses to its March 2006 request for public comment on the original draft. On December 26, the NPC decided not to vote on the second draft, meaning that further revision is possible. ¶2. (SBU) The international business community has not yet provided any official reaction to the new draft. The American Chamber of Commerce in China (Amcham) and the US-China Business Council (USCBC) are both in the process of reviewing it and soliciting their members' comments. Amcham plans to hold a roundtable meeting for its members to discuss the new draft during the week of January 22, with a view toward giving additional comments to the NPC at an appropriate time. (The NPC has not yet asked for public comment on the second draft.) ¶3. (SBU) Comment: A preliminary look at the new draft suggests that the NPC did respond positively to some of the international business community's original comments on the first draft(ref B),as well as concerns raised by Chinese labor organizations. In a public statement accompanying the release of the new draft, the NPC accurately summarized these concerns, without attribution, and explained how the second draft takes these concerns into account. While Amcham and others have been criticized in the international press and by members of the United States Congress for allegedly lobbying against workers? rights (ref A), the NPC expressed no such sentiment, and appears intent on producing a law that will effectively improve workers? rights protections without creating unreasonable obstacles to doing business. Embassy will provide more details on the draft LCL once Amcham and USCBC have finished studying it. RANDT