IBM Guangdong plant hit by strike over workers' severance package

IBM workers shout slogans as they protest at an IBM factory in Shenzhen, Guangdong province, March 7, 2014. More than 1,000 workers at an IBM factory in southern China have gone on strike against the terms of their transfer to Chinese PC maker Lenovo Group Ltd caused by the U.S. company's $2.3 billion sale of its low-end server business. [Photo/Agencies]

A strike at an IBM Corp factory in southern Guangdong province entered its fifth day on Friday as more than 1,000 workers demanded higher severance payments ahead of a Lenovo Group Ltd takeover.

Workers were protesting the factory's decision to announce a severance plan without seeking their input and forcing them to make a decision on short notice.

A banner displayed at the factory gate read: "We are not products, not assets and not slaves, please do not sell us out."

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The Great Wall International System Technology (Shenzhen) Co Ltd, IBM's fully owned x86 server maker, said on Monday it would give workers 6,000 yuan ($980) for signing a severance agreement before Friday. But few of the workers had signed by Friday evening.

"The factory told us we will receive the award as soon as the transfer is finished, but no one knows when exactly," said Wen Yong, a production line manager who has worked in the factory for 10 years.

Chen Bo, a worker at ISTC, said the factory has been reducing the ranks of permanent staff for about two years.

It recruits temporary workers in peak season to reduce costs.

"The number of temporary workers is several times larger than that of permanent workers," said Chen.

"We are fighting for a fair reward for years of hard work, and they cannot just throw us out," said Wen. About 70 percent of the employees have been working at the facility for more than five years, he said.

Workers said the strike will continue until their demands are met.

In January, the world's biggest personal computer producer, Lenovo, said it would buy IBM's x86 server unit for $2.3 billion.

The deal is expected to close in the fourth quarter of 2014, according to Lenovo Chief Financial Officer Wong Wai-ming.

The company is expected to take in about 7,500 former IBM employees from several countries, including Canada and the United States.