Strike at IBM's China factory falters as hundreds quit jobs

About 1,000 workers had staged a protest outside the factory starting last week

Hundreds of striking workers at an IBM server factory in China have decided to leave their jobs, disappointed with the U.S. company and the wages they will get once Lenovo takes over the factory.

IBM plans to transfer ownership of the Chinese factory, as part of its proposalA to sell its x86 server business to Lenovo. But on March 3, about 1,000 workers started protesting against IBM and its offer to employees to either move to Lenovo or take a severance package.

Among the workers' demands, was a call for a better compensation package, as some employees who had been at the factory for 10 years or longer were expecting more than was offered. There were also concerns that Lenovo would end up cutting jobs once the company takes over.

By Tuesday, most of the striking staff had decided to either return to work, or leave their positions, according to two workers interviewed. Some employees continue to protest, but the large crowd that once surrounded the facility, has diminished to about 100 people, they added.

One former worker, surnamed Luo, estimated that 300 to 400 workers had left the factory. Luo herself was among 20 employees fired on Monday for violating factory rules, and participating in "illegal gatherings" during the protest, she said in a interview.

The factory's management never gave workers any chance to discuss the terms for the transition, Luo added. Later, IBM gave a bonus to workers who agreed to return. Others decided to take the severance pay, she said.

"After a situation like this, many workers have changed the way they view the company," said another worker surnamed Zhang. "It left people dispirited."

The server factory, however, has remained in operation after the company hired temporary workers to take over their positions, according to the former employees.

IBM on Tuesday said the company was working "toward a successful transition" to turn over the facility to Lenovo. The striking employees have begun to return to work, and IBM expects a majority of the employees will transfer to Lenovo, the company said in an email.

IBM added that it was providing a severance package to resigning workers, even though the company is not legally required to do so.

On Monday Lenovo issued its first statement on the strike, and pledged to protect the workers' pay and benefits, during the transition. "The talent we are acquiring is a great asset, and key to our long term success," it added.

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