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China unions may be negotiating with McDonald's, KFC

SHANGHAI China Unconfirmed news reports claim that China's state-affiliated labor union, the All-China Federation of Trade Unions, expects McDonald's China and Yum! Brands Inc. to accept unionization of employees in southern China by the end of 2007. These reports closely follow an earlier one accusing the two quick-service giants of paying part-time workers in the Guangdong capital of Guangzhou up to 40-percent-less than minimum wage.

McDonald's China said in a statement that the union's claims are premature.

The statement said: "McDonald's China has for more than 10 years worked with city and provincial branches of the All-China Federation of Trade Unions to establish unions that represent McDonald's employees in those geographic areas. For several months, McDonald's China has been talking to the Guandong Province union officals and making progress in setting up union branches to represent McDonald’s China employees."

Addressing the wage issue, McDonald's China said, "We continue to work with local officials to get further clarity on their recently amended labor laws, seeing as how there are now five separate classifications of workers."

According to a statement from Yum, "We fully comply with all labor laws in China and have paid all our employees, including part-time students, appropriately. We are working with the local government in Guangdong Province to clarify their new laws for part-time students to be certain we remain in full compliance."

McDonald's has an estimated 50,000 employees, many of them part-time, in mainland China in 790 restaurants. Yum Brands, which operates a total of 2,000 KFC, Pizza Hut and East Dawning restaurants in China, employs approximately 100,000 workers.

Workers for McDonald's in some other foreign countries are unionized, but a corporate spokesperson said she cannot verify which countries those are.

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