Watch factory Citizen to pay more for shutdown in China

A woman walks past a Citizen store in Shanghai, July 19, 2009. [Photo/IC]

Most of the workers at a well-known Japanese company in Guangzhou, Guangdong province, that shut down last week have signed contracts to leave the company of their own accord after mediation from local labor department and trade unions by Monday noon.

After mediation, the Japanese watchmaker Citizen agreed to give workers severance pay plus two months' salary as compensation. It will also pay the workers' social security, according to a statement on Monday from the Huadu District Bureau of Labor and Social Security.

Previously, Citizen had agreed to pay its employees only severance plus one month of salary, as compensation, the statement said.

"A total of 968 workers have signed contracts to leave Citizen of their own accord by Monday noon, and the labor department will continue to make efforts to help the remaining 74 workers, who refused to accept the compensation plan, to negotiate with the company," the statement said.

A task force headed by the labor bureau was set up immediately when Citizen suddenly announced on Thursday that it would dismiss more than 1,000 workers.

The workers gathered at the factory over the next few days to express their demands peacefully.

A public relations executive surnamed Huang acknowledged the company had increased the compensation to workers after mediation from labor and the labor bureau. "The closing of the Guangzhou facility was related to the company's global reduction policy," Huang said, adding that the company dismissed workers abruptly because it did not want the company's normal operations to be affected by unhappy workers after an announcement.

Chen Xiaogang director of the general office of the Huadu Federation of Trade Unions, said the case is being handled peacefully after mediation, with more than 90 percent of the workers expressing satisfaction.