This article was downloaded by: [99.165.65.

11] On: 09 October 2013, At: 07:54 Publisher: Routledge Informa Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House, 37-41 Mortimer Street, London W1T 3JH, UK

Ethnic and Racial Studies

Publication details, including instructions for authors and subscription information: http://www.tandfonline.com/loi/rers20

The vulnerable other distorted equity in ChineseGhanaian employment relations

Karsten Giese & Alena Thiel Published online: 21 May 2012.

To cite this article: Karsten Giese & Alena Thiel , Ethnic and Racial Studies (2012): The vulnerable other distorted equity in ChineseGhanaian employment relations, Ethnic and Racial Studies, DOI: 10.1080/01419870.2012.681676 To link to this article: http://dx.doi.org/10.1080/01419870.2012.681676

PLEASE SCROLL DOWN FOR ARTICLE Taylor & Francis makes every effort to ensure the accuracy of all the information (the Content) contained in the publications on our platform. However, Taylor & Francis, our agents, and our licensors make no representations or warranties whatsoever as to the accuracy, completeness, or suitability for any purpose of the Content. Any opinions and views expressed in this publication are the opinions and views of the authors, and are not the views of or endorsed by Taylor & Francis. The accuracy of the Content should not be relied upon and should be independently verified with primary sources of information. Taylor and Francis shall not be liable for any losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoever or howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the use of the Content. This article may be used for research, teaching, and private study purposes. Any substantial or systematic reproduction, redistribution, reselling, loan, sublicensing, systematic supply, or distribution in any form to anyone is expressly

forbidden. Terms & Conditions of access and use can be found at http:// www.tandfonline.com/page/terms-and-conditions

Downloaded by [99.165.65.11] at 07:54 09 October 2013

Ethnic and Racial Studies 2012 pp. 1 20, iFirst Article

The vulnerable other distorted equity in ChineseGhanaian employment relations

Karsten Giese and Alena Thiel (First submission September 2011; nal version received May 2012)

Downloaded by [99.165.65.11] at 07:54 09 October 2013

Abstract Based on a two-sided ethnographic study in Accra, this paper analyses Chinese Ghanaian employment relations from the perspectives of psychological contract, cross-cultural equity expectations and foreignness. Reaching beyond racially framed allegations of each other that are informed partly by politicized media discourses, structural analysis shows that mutually contradictory, culturally grounded expectations regarding their employment relationship are central to the understanding of conflict between Chinese employers and Ghanaian employees. Central to the frictions of mutual equity expectations is the feeling of existential vulnerability that although particular for each group is shared by both Chinese migrant employers taking high financial risks in an unfamiliar and potentially hostile environment and their local employees recruited almost exclusively from economically marginalized groups.

Keywords: labour relations; equity; psychological contract; trade; China; Ghana.

Introduction1 Following the intensifying Chinese economic engagement in Africa, publications on labour conflicts and labour rights violations in Chinese enterprises have become numerous. Such accounts usually focus on large enterprises within construction or mineral extraction (Wang and Flam 2007; Utomi 2008, pp. 51 53 Baah and Jauch 2009; Moumouni 2010; HRW 2011). Labour relations within small-scale manufacturing, trade and services have been largely neglected. However, Chinese trading companies in particular have mushroomed in Africa. Given the number of Chinese merchants in urban African settings and the embeddedness of their activities within the local socio-economic fabric, potentially conflictive employer employee relations may have a much
# 2012 Taylor & Francis ISSN 0141-9870 print/1466-4356 online http://dx.doi.org/10.1080/01419870.2012.681676

2 Karsten Giese and Alena Thiel

greater impact on the local setting than labour conflicts in large-scale projects operating with few links to the local society. Hence conflicts arising between local employee and Chinese employer may challenge the economic and social integration of Chinese sojourners and their businesses far beyond the individual case. Such conflicts may quickly amplify latent sociopolitical frictions sparked by general perceptions of the destructive impacts of the Chinese economic activities in Africa. Local African discourse on Chinese economic activities and related labour conflicts is largely dominated by racial stereotypes informed by politicized media reporting that often reflects particular agendas related to election campaigns, the call for protectionist measures or social distribution conflicts. Hence, it is unsurprising that mutual perceptions are framed in similar terms on the inter-individual level, although other factors are central to the understanding of labour conflicts in the trading sector. Exemplifying Ghana, our structural analysis will demonstrate how, beyond superficial racial prejudice, both the Chinese employers and African employees perceptions of vulnerability and risk play a central role within their employment relation and the mutual interpretation of obligations, reciprocity and equity of exchange arrangements therein. Here, the vulnerability of Chinese traders to become victims of general social and political conflict and to jeopardize their substantial investments is mirrored by the material vulnerability of the young and marginalized Ghanaian employees. In the urban settings of Ghana, Chinese trading businesses are usually jointly run by small numbers of sojourning members of extended families who create employment for an about equal number of Ghanaians. Based on in-depth ethnographic fieldwork conducted among Chinese merchants and their local African employees in Accra from January to March 2011 and from November 2011 to January 2012, we will introduce the situation of Chinese family-run trading companies within the local economy and labour market. We will then explore Chinese African employment relations and inherent conflicts from the two-sided perspective of employees and employers contrasting equity expectations and diverging vulnerability perceptions. We will explore employees coping mechanisms in view of perceived inequity and their contribution to the revision of employment terms as well as Chinese employers countermeasures. Data have been collected from a sample of approximately 100 individuals representing thirty Chinese trade businesses and some related service providers. At the time of the survey the randomly selected companies had been operating for between two months and almost ten years. Data collection was carried out in each Chinese trade enterprise in the form of repeated visits of two to eight hours each, complemented by several separate in-depth qualitative interviews with both Chinese employers and Ghanaian employees. (see Appendix for details on respondents)

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

Downloaded by [99.165.65.11] at 07:54 09 October 2013

This methodology, rooted in our regional specialization in West Africa and China not only allows us to present a two-sided account of both the Ghanaian employees and the Chinese employers perspectives on the employment situation, but contributes to closing a profound research gap concerning the working of the psychological contract in cross-cultural employment relations by demonstrating how mutual equity expectations are constructed under conditions of foreignness and how perceived equity distortions are mediated and addressed when shared normative frameworks are absent. While academic research on work and work relations in different African societies has a long tradition, only a few of these early studies have paid attention to cross-cultural employment relations (Charles 1952; Sofer 1954). More recent articles focusing on cross-cultural employment usually limit their focus to management practices in complex organizations (Jackson 2002, among others) and have a strong bias towards the employees equity expectations (Brooks 2010, among others), leaving the employers perspective largely uncovered. Simultaneously researching both Chinese employers and Ghanaian employees for the first time allows an account of this particular relationship without falling into the common trap of de-legitimizing the perspective of either side due to the limitations of regional specialization and hence restricted access to information. Chinese merchants in Ghana Since the beginning of this millennium Chinese entrepreneurs have been arriving in Ghana in substantial numbers. Estimates vary between 2,000 and 10,000 (cf. Sautman and Yan 2007; Ho 2008, pp. 59 60 Mohan and Tan-Mullins 2009, pp. 590 592). Most Chinese who arrive independently of large construction projects have chosen to import cheap consumer goods made in China. Like all foreign-owned investments in trade, these companies are subject to the provisions of the Ghana Investment Act (1994), that reserves exclusively for Ghanaians the sale of anything whatsoever in a market, petty trading, hawking or selling from a kiosk at any place. For lawful operation of a wholesale trading company wholly or partially owned by a nonGhanaian, two requirements have to be met: (1) investment of no less than US$300,000 as foreign capital or in goods of equivalent value; and (2) the employment of at least ten Ghanaians. Upon completion of registration the foreign investor is entitled to an immigration quota of two persons for paid-up investment capital of up to US$300,000 and an initial automatic quota of four persons for investments of US$500,000 and above. Having registered the company the foreign merchant must report to the Ghana Investment Promotion Centre (GIPC), established for

4 Karsten Giese and Alena Thiel

holding records of all foreign investments in Ghana except for mining and petroleum companies. The statistics received from the GIPC account for 147 Chinese companies engaging in general trade registered in the period 1994 2011 (GIPC 2011) although there may be many more operating illegally. Chinese wholesale shops in general are not fancy outlets but very functional establishments: a simple room completely open to the street, furnished with a simple desk, some improvised seats, maybe a rack along the back wall for displaying the merchandise, floor space for cartons or plastic bags full of goods, and in some cases, a warehouse attached to the back of the shop. As a rule these simple vending spaces have to be rented for five to ten years with upfront payment of US$25,000 US$60,000 for the whole period (CTcb112 2011; CTcb131 2011b; CTcb161 2011b; CTcbf100 2011). Additional initial investments include the rental of warehouse space, a house for accommodating the investor and one or two family members-cumbusiness partners or Chinese employees, and the purchase of a car. A Chinese setting up a wholesale business in Ghana requires initial capital stock of at least US$500,000 US$1,000,000, depending on the kind of goods being traded. Not only by Ghanaian standards is this sum huge and constitutes a heavy financial burden and risk for Chinese investors, who in their majority depend on private lending and mortgages as sources for running their by international standards small-scale businesses. Owing to the low value of merchandise, the particular business model emphasizing high turnover at low profit margins, and the cut-throat competition between the Chinese in Ghana, year-end net profits do not allow large fortunes to amass, since proceeds are largely reinvested in order to expand the scope of the operations. With net profits of US$10,000 US$80,000 per person and year, the average Chinese trader in Ghana generally leads a life of self-imposed saving and restriction (CTcb130 2011; CTcb152 2011; CTcb161 2011a; CTcbf162 2011). Along with the ability of eating bitterness (chi ku) that is deeply engrained in the entrepreneurial mindset, these self-restrictions include, for instance, the separation from close but unproductive family members such as spouses and children, which in addition to financial risk significantly increases the psychological burden on Chinese entrepreneurs operating in an already uncertain foreign environment (cf. Dobler 2009, p. 710). This said, most of our Chinese interviewees were convinced that with regard to the scale and simplicity of their businesses they could do perfectly well without hiring any Ghanaians. Hence the legal requirement of employing at least ten Ghanaians is regarded as a big (financial) burden and politically imposed barrier to market entrance. In order to cut costs, all interviewed Chinese merchants have circumvented these regulatory requirements by officially registering

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

fictional employees. In reality, many Chinese are employing no more than one to three Ghanaians as shopkeeper, driver or watchman in many cases to make their violation of the law less apparent but also because they realize that local assistance is valuable for certain tasks, not least the mediation of conflicts with and the protection from undue demands by customers and officials.

The Ghanaian labour market and the Chinese employer Jobs in the Chinese trade businesses are generally low-key, lowresponsibility tasks that require little or no training and hence do not carry high social status in the perception of both Chinese and Ghanaians. The majority of employees in our sample thus do not possess formal education beyond secondary school, university degrees and higher diplomas being the rare exception, but have largely received vocational training in unrelated sectors such as masonry or carpentry. Irrespective of educational level, the typical Ghanaian employee in Chinese trade businesses in Accra is male and between twenty and thirty years old. Female employees are usually of the same age group but are much less common, possibly due to the perceived physical nature of the work. Official statistics attribute the highest share of unemployment to the countrys youth in the urban centres, especially the Greater Accra area, with male unemployment rates slightly exceeding female (GSS 2008). With rural migrants shunning farm work, although agriculture at least statistically provides more income-generating opportunities, access to the urban labour market is both strongly contested and highly restricted by persisting cultural and social norms and practices. The Ghanaian labour market is not accessed through education or training, as Chant and Jones (2005) posit, but through the ability to utilize membership of social networks. A strong preference to employ ones own kin mediated through a relatives introduction persists throughout the entire economy (Velenchik 1995; Collier and Garg 1999; for youth employment in the form of apprenticeships, see Peil 1970; for the trade sector, see Clark 1994). This means that young employees or apprentices enter complex interpersonal exchange relationships of mutual obligations and entitlements, which although informal in character are enforced by shared norms of reciprocity and sanctioned by social control within the context of the extended family. Although Ghanaian employment relationships in general are characterized by a large power distance (Debrah 2001), and employers in the Ghanaian trade sector in particular enact authority through physical strength, loud talk and exercise of power over others as widely accepted as a necessity of the

Downloaded by [99.165.65.11] at 07:54 09 October 2013

6 Karsten Giese and Alena Thiel

business (Overa 2007), family relations usually ensure that such arrangements do not derail and become exploitative for either side. Transactions in these relationships range from the exchange of training fees against skill acquisition over wages2 and allowances in cash and kind (e.g. for transportation, housing, medical bills or funeral attendance), as well as additional non-monetary benefits such as gifts, food or accommodation, and not least, rewarding the employees long-term loyalty with the start-up capital needed for independent economic activities. These transactions cannot simply be substituted with wages as they are important, not least symbolic, signifiers of cultural values, particularly the employers role as a benefactor, guardian and protector (Charles 1952, p. 434) who derives his or her status and authority precisely from taking on responsibility for others and from showing moral commitment or loyalty. Ghanaian employers are highly appreciated for their availability to employees for personal advice and assistance in cases of financial emergencies. In that sense, employers assume the role of elders, figures of respect and wisdom. Youth employment, in this light, is widely recognized as a way to give a person a chance to progress in life beyond the mere material dimension. Although Chinese traders are not influenced by the gatekeeping mechanisms of the Ghanaian labour market, empirical evidence shows that their employment decisions are not exclusively based on market mechanisms either. Only seldom do Chinese wholesalers advertise jobs or recruit via placement agencies. Neither is hiring one of the many applicants who voluntarily offer their labour the rule. Informed by a similar logic of mutual social obligations as within the Ghanaian context, Chinese employers tend to prefer employees recommended by a loyal customer, neighbour (African or Chinese) or other trustworthy acquaintance. Given their perceived vulnerability as foreigners, this is clearly a strategy to reduce the risk of labour conflict and as a result, the potential threat of antagonizing the local host society, which racializes public discourse on employment practices in the same way as the Chinese selling cheap merchandise are denounced for cheating Ghanaian customers, while Ghanaian and other nationals imports of similar qualities are not subjected to such allegations. In fact, even though wages in Chinese trade businesses often exceed the local average, labour relations with the Chinese are widely interpreted as unjust and exploitative. Theorizing Chinese Ghanaian employment relations By basing employment decisions on trust in third parties, theoretical considerations suggest that Chinese traders and their local employees are initiating an employer employee relationship that from their

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

perspective at least partially is based on mutual trust and includes social-emotional rewards in addition to monetary remuneration. The actors invest in relationships that are expected to resemble social exchange (cf. Blau 1964) rather than purely economic exchange. Instead of short-term, impersonal, pecuniary agreements (Shore et al. 2006), social exchange relationships are characterized by a diffuse or unspecified obligation to return an initial transaction based not on rational contractual agreements but on trust in the others moral engagement in the relationship (Blau 1964). According to the Chinese logic of social relationships (renqing, guanxi), the introduction through a trusted third party (guarantor) ensures that the employee will perform well and minimizes the risk of conflict, primarily because of the employees social obligation towards the guarantor and the desire to earn the guarantor face. Within the Chinese cultural and social context of larger economic units, Wang et al. (2003, p. 515) assert that the employee may feel obligated to reciprocate through harder work, while Chen, Aryee and Lee (2005, p. 459) observed feelings of obligation to reciprocate . . . the exchange by demonstrating work attitudes and behaviours that benefit the organization. This said, the Chinese owner-manager of a familyrun trading company in Ghana, who has established an interpersonal relationship with the local employee (and the guarantor) through employment will share these expectations. Having internalized the Chinese sociocultural norm of immediate and equal repayment of financial and socio-emotional debts as essential for nurturing relationships (cf. Xin and Pearce 1996; Tsui and Farh 1997), the Chinese employer is counting on the Chinese employees empirically proven adherence to the norm of reciprocity (cf. Yang 1994; Gabrenya and Hwang 1996; Xin and Pearce 1996; Buchan, Croson and Dawes 2002; Westwood, Chan and Linstead 2004; Wu et al. 2006) and transplants this logic into the African setting. Although it is widely accepted that the norm of reciprocity is universal to all cultures (Gouldner 1960, p. 171), different sociocultural contexts give rise to cross-societal differences regarding form and nature of interpersonal exchange relationships in general and attitudes and perceptions people share regarding employment relationships in particular (Baldry 1994; Bamber and Lansbury 1998; Pot 2000). Problems in Chinese Ghanaian employment relations can therefore be expected to arise on the basis of the foreignness of the Chinese traders in Ghana and their socially and culturally grounded approach that not the employer but the (extended) family is responsible for providing an individual with social and material security, which is in sharp contrast to the role of the employer as perceived by Ghanaian employees.

Downloaded by [99.165.65.11] at 07:54 09 October 2013

8 Karsten Giese and Alena Thiel

Hence we assume that it is due to foreignness and different interpretations of the reciprocity norm, including related social practices, that both Ghanaian employee and Chinese employer may perceive their implicit agreement on the equal inputs in the employment relationship violated. This implicit agreement regarding the distribution of rights and duties between employer and employee is usually referred to as a psychological contract (Rousseau 1996). The concept of psychological contract allows analysing labour conflicts beyond the explicit terms of formal written contracts and is therefore particularly suitable for the discussion of individual labour relationships that are predominantly informal and not based on explicit negotiations of contract terms. There is ample empirical evidence that employees construct their individual psychological contracts on the basis of pervasive social norms of reciprocity in employment relations (Rousseau 1990; Robinson, Kraatz and Rousseau 1994; Robinson and Rousseau 1994) but not necessarily geared to the specific employment situation (McFarlane Shore and Tetrick 1994, p. 98). Usually lacking some amount of information with regard to their employer when they start working, employees tend to fill in information based on existing schemas (Salancik and Pfeffer 1978) informed by previous experiences and social norms. Messages sent by the employer that do not comply with these norms and expectations may be perceived as a violation of the psychological contract and result in reactions targeted at restoring the distorted equity of exchange or ultimately the termination of both the psychological contract and social exchange relationship (cf. McFarlane Shore and Tetrick 1994). Since employees regard their reactions as a means of restoring equity, they are rejecting the responsibility for not meeting the employers exchange expectations (cf. Murphey and Cleveland 1991) and possibly causing the relationship to deteriorate further. It has been established that employees confronted with perceived breaches of the psychological contract react with silence, voice, retreat or destruction in order to restore equity, or finally opt for exit and termination of the employment relationship (McFarlane Shore and Tetrick 1994, p. 103; Geurts, Schaufeli and Rutte 1999, p. 256). In the context of purely Ghanaian employment relations, silence is usually the first form of response because social norms forbid young employees to approach their superiors directly. Where perceived inequity is accompanied by the gradual loss of trust in the employers perceived role as guarantor for basic material security, however, it is common for Ghanaian employees to seek assistance from a mediator usually the person who introduced the relationship. Although Chinese Ghanaian employment relations are also mostly established through an intermediary, for unknown reasons neither this person nor the employee

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

Downloaded by [99.165.65.11] at 07:54 09 October 2013

perceives this third party as a potential mediator. Hence taking refuge in silence ultimately fails to restore trust and equity within Chinese Ghanaian labour relations. Similarly, with regard to the general labour market situation, exit is not a viable option for Ghanaian employees either, which leaves us to consider voice, retreat and destruction. In cross-cultural employment, relationships that are characterized by the absence of a common language, voice thought of as verbalization of discontent may follow different rules to mono-cultural settings. Hence, for the purpose of this study we widen the definition of voice by including phenomena of verbalization, demonstrative forms of retreat, and open destruction. Perceptions of distorted equity are no one-way street, particularly under conditions of exchange relations across cultures. Employers may thus interpret coping strategies as attempts by their employees to renegotiate at their expense the work performance that is regarded as equal in value to the remuneration they receive. We therefore widen the analysis of perceived equity violation by introducing the employers perspective as equally relevant for the understanding of exchange relations under the conditions of foreignness. The psychological contract and equity expectations under conditions of foreignness Given the fact that a number of our Ghanaian interviewees explained that they lacked information about the nature of their job and their employment relationship when they were introduced to their Chinese employer, we can assume that the picture of the employer as a morally committed provider of social and material security and the general knowledge of the cultural norms and practices of Ghanaian employment relations in the trade sector informed their equity expectations. Upon taking up employment, however, employees are confronted with employers that do not fit into the Ghanaian role model. The general appearance and behavioural patterns of Chinese traders, their humble and low-key appearance in casual attire, is in stark contrast to the physical size and the display of wealth and power of Ghanaian traders. As Ghana is not their arena for demonstrating economic success to their peers by means of conspicuous consumption, the behaviour of Chinese traders largely follows the business logic of keeping inputs low. Even the expensive sport utility vehicles (SUVs) stereotypically associated with them and their fenced-off accommodation in relatively prestigious neighbourhoods of Accra are convincingly presented by the Chinese traders as costly solutions for coping with the feeling of vulnerability and the threat of armed robberies rather than regarded as personal luxuries. Symbols of wealth and status for the Ghanaians thus represent mere means of survival for the Chinese.

10 Karsten Giese and Alena Thiel

These fundamental differences due to the foreignness of the Chinese leave potential Ghanaian employees at odds with the interpretation of the mixed and predominantly non-verbal messages their Chinese employers send out. When comparing the dominant image of powerful traders, laden with cultural values of seniority and authority, to their Chinese employers, Ghanaian employees in Chinese trade businesses in Accra develop perceptions that are distorted by the cross-cultural translation process. Naturally grounding the psychological contract more in the pervasive norms of Ghana than in non-existent experiences with Chinese traders, the Chinese absence of family ties with the employee, their non-performance of security provision, combined with their unimpressive physical appearance and inconspicuous industriousness often result in a lack of respect for the Chinese employer. The humble clothing of the Chinese is interpreted as provinciality rather than frugality (CTge16 2011), while driving around in SUVs is seen as nothing but a display of wealth while failing to provide employees with basic material security, expressed for instance in the monthly gift of a sack of rice. This common view is then translated into a widely accepted allegation of the Chineses exploitative treatment of Ghanaian labour. While the Chinese are seen to be able to afford luxury items, the Ghanaian culture expects those who are fortunate enough to escape poverty (GTgb2 2011) to share with those who supported them in the creation of their wealth, although this generally applies to members of the extended family only. Chinese merchants, on the other hand, having geared wage levels to the general situation in Accra, and in a few cases consciously paying well above average, do not understand their employees repeated demands for grants and allowances beyond regular monetary gratification. They are unaware of the locally pervasive norms and obligations involved in employment relations and the symbolic nature of such allowances as tokens of social/personal responsibility towards the employee. They are convinced that frequently asking for leave to follow important social obligations such as attending funerals qualifies for wage cuts rather than for extra allowances (cf. Charles 1952). Employees who have been introduced to them on the basis of mutual trust should express high commitment to work before asking for any additional gratification. Both the psychological contract of Ghanaian youth and the equity expectation of the Chinese employer are grounded in perceptions and culturally informed conventions that do not comply with the crosscultural nature of this social exchange relationship. Based on conflicting interpretations of the reciprocity norm, this mutual ignorance/incomprehension of vulnerability/risk perceptions almost inevitably translates into allegations of equity violation.

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

11

Coping with perceived inequity Ghanaians are employed for shifting goods from one place to another, fetching goods from the warehouse or handing out commodities tasks that the employers do not hesitate to carry out themselves. Hence it does not usually occur to most of the Chinese to cherish the Ghanaian work or openly and directly express satisfaction a practice that is rarely seen in the purely Chinese context either. On the other hand, the lack of appreciation for their work and abilities beyond simple monetary remuneration is one of the most widely perceived breaches of the psychological contract stated by our Ghanaian interview partners (CTge16 2011; CTge28 2011; CTge36 2011).
Downloaded by [99.165.65.11] at 07:54 09 October 2013

Verbalization For the Ghanaian employee, being disregarded as a valuable addition to the business connotes the perceived failure of Chinese employers to respect them as a complete person, not least by taking their personal risks seriously and giving assistance in times of personal hardship. Owing to the cultural aversion to verbalizing discontent and the lack of common language between Chinese employer and Ghanaian employee, only the more self-confident and better-educated employees are able to react verbally, making suggestions for improving their employment conditions (CTge25 2011). Generally speaking, verbalization succeeds only in the rare situation when the two involved parties are not handicapped by language or psychological barriers and share a general mutual appreciation for each other as persons. Despite the minimal salary she receives, one interviewed employee emphasized the fact that she is highly appreciated in the shop, with numerous customers asking for her and tasks being her exclusive specialty. She takes pride in the fact that she was asked to return after being temporarily laid off for verbalizing her demand for a pay rise a couple of years ago. Although she did not manage to capitalize on the Chinese employers inability to replace her, she was happy to return to an employment relationship in which her superior cared for her. She appreciates the Chinese employers assistance in caring for her terminally ill mother and later her newborn baby, and is also grateful for minor investments like the daily sharing of meals and the general interest taken in employees lives. Because she communicates well with her boss, the initially tense situation was solved in a non-conflictive manner (CTge28 2011). The majority of cases follow a less positive pattern. Almost every Chinese employer we interviewed complained that their employees sporadically demand what they deem unjustified tips (xiaofei) in exchange for normal tasks allegedly covered by their employment

12 Karsten Giese and Alena Thiel

agreement. A worker employed to assemble aluminium window frames was reported to ask for tips before agreeing to carry the components into the storage room each time a new delivery arrives from China (CTcb128 2011). A Ghanaian shopkeeper regularly acts reluctantly when asked to buy soft drinks from a nearby shop until he is given a tip either in cash or kind, according to the statement of one Chinese informant (CTcb161 2011a), while a third employer explained that her worker even dares to demand additional payment whenever he is asked to venture from shop to warehouse for stocking up (CTcb103 2011). In common here is that by frequently demanding small extras, the employee is verbalizing dissatisfaction, not necessarily with carrying out basic tasks, but with a more general perceived inequity. In this way the employees try to extract what they perceive to be denied to them in the form of concrete emergency assistance and the provision of basic material security as signified by repeated voluntary allowances. Many Chinese, unaware of this widely accepted obligation to perform symbolic acts signifying their commitment to provide material security, interpret their employees voices of discontent differently. Since they themselves work long hours, endure monotony and are willing to eat bitterness in view of future earnings, being asked frequently by their workers for tips in addition to above-average wages without showing a corresponding level of commitment simply comes across as a behaviour that lacks any reasoning and also violates their value system, in which the person is most appreciated who strives for self-improvement. While some Chinese found ways to free themselves from their employees demands by demonstrating their superiority and authority as employers (CTcb103 2011; CTcb152 2011; CTcbf164 2011; CTce107 2011), those who lack management and communication skills are doomed to pay and reluctantly restore the equity as perceived by the employee (CTcb103 2011; CTcb141 2011; CTcbf100 2011; CTcbf166 2011). Since most Chinese employers are reluctant to terminate contracts and look for new workers because they are concerned about antagonizing larger parts of the local community and fear to exchange a bad worker for a worse one (CTcb103 2011), verbalization may succeed for Ghanaian employees but it may also backfire. An employee, having received a financial incentive for no longer being late in the morning, returned to his old habits after a while, which was met by cutting back his wage to the original level. When he loudly uttered his dissatisfaction about what he perceived as illegitimately withholding a gratification he felt entitled to, he was laid off (CTcb131 2011a). Although not resulting in the termination of the contract, a further case clearly demonstrates the limitations of verbalization within Chinese Ghanaian employment. Convinced that his pay was too low, one employee managed to negotiate a pay rise by complaining

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

13

about the rising transportation fares, although he lived within walking distance of the shop. After his employers initial refusal, he turned to non-verbal strategies and started purposely and demonstratively to come into work late every morning until he was finally given an increase (CTge30 2011). Demonstrative retreat and open destruction Retreat is the withdrawal, either mentally or physically, from the work environment. While mental exile is not conducive to the restoration of equity, applied demonstratively as in the case mentioned above, it can serve as an expression of discontent and thus as a means of voice. Thus, what the Chinese employers view as lack of proactivity is often a conscious strategy of Ghanaian employees (CTge25 2011; CTge28 2011). One Chinese complained in an interview that it would never cross his Ghanaian employees minds to pick up waste from the ground and dispose of it. They would only do so when told, but would not proactively reproduce this behaviour; rather, they would casually kick the waste material around when passing (CTce168 2011). For the Ghanaian employee, this behaviour constitutes a non-verbal demonstration of discontent in the form of retreat from obvious tasks in an attempt to restore the distorted balance of his psychological contract. In some cases, Chinese employers are able to interpret acts of retreat for what they are strategies for coping with perceived inequity. One importer of commodities that have to be assembled before being sold on the Ghanaian market was confronted after a while with low productivity. Unwilling to accept a revision to the psychological contract of his employees, he reacted to the retreat by changing payment modalities. From his perspective the introduction of a piecework system successfully disciplined the assembly-line workers of his trade business and restored the equity that had been temporarily distorted by the retreat of his employees (CTcb130 2011). According to the logic of this Chinese employer, this also provided his employees with the means to take precautions against potential material risks, if they were only willing to work harder. If equity distortions are perceived to escalate or to perpetuate without any prospect for improvement, coping strategies can become destructive. Feeling threatened by existential risks without any perceived willingness to help out on the part of their employers, some of our Ghanaian informants consequently denounced the Chinese as inhumane since they allegedly failed to show empathy for their employees (CTge16 2011; CTge28 2011). Although quite a few of the Chinese traders we interviewed believe they have established dependable relationships, take an active interest in the lives of their employees, and occasionally express their appreciation through small

Downloaded by [99.165.65.11] at 07:54 09 October 2013

14 Karsten Giese and Alena Thiel

and sometimes valuable presents from their travels to China (CTge16 2011; CTge27 2011; CTge33 2011), this perception is not usually shared by their employees. To one employee the gift of a rather expensive mobile phone as a sign of appreciation for his work by the Chinese employer cannot compensate for his general dissatisfaction with the Chinese for rejecting their perceived social obligations. The regular sack of rice as a symbol of the employers responsibility for providing material security would contribute much more to reducing his perceived vulnerability and increasing his job satisfaction than any expensive gift. One interviewed employee, for instance, expressed his existential fear of falling sick as, far away from his family, there would be nobody to pay his hospital bills. To make matters worse, he feared that every day of illness would be deducted from his pay thus further increasing the hardship, rather than his employer granting paid sick leave and covering medical bills as Ghanaian employers would in many cases do (GTgb2 2011; GTgb7 2011). In view of such acute violations of the psychological contract, a very common form of openly destructive behaviour seems to be that Ghanaian employees simply take without asking what they perceive to have been denied by their Chinese employers thus substituting their entitlement to long-term social security provision with short-term material gains. Almost every Chinese trader agreed with the notion that Ghanaian employees steal if they are not supervised, and many were able to present detailed accounts of theft of which they or their compatriots were victims (CTcb152 2011; CTcbf165 2011). Most of our Chinese respondents react with increased alertness and surveillance without considering the potential reasons for this allegedly common behaviour (CTcb152 2011). They usually do not search for underlying reasons, are not aware of their employees existential fears, but attribute this behaviour to the general moral deficiency of the African. Only one Chinese trader consciously interpreted theft in terms of Ghanaian employees dissatisfaction with their exchange relationship, although he too was unable to relate this deviant behaviour to perceived vulnerability and his own failure to fulfil his role as a responsible employer as perceived by Ghanaians (CTcbf122 2011). Conclusion This paper set out to explore Chinese Ghanaian employment relations and the conflictive potential therein as an example of cross-cultural exchange relations. The two-sided ethnography enabled us to close some of the extant research gaps. Through this methodology we have overcome usual research limitations rooted in regional specialization and linguistic capabilities and hence were able to present an account

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

15

simultaneously representing the perspectives of both parties involved and to analyse the significance of notions of reciprocity, loyalty and trust, and the embeddedness of working relations in such concepts. Limitations inherent to qualitative research, however, remain. Owing to the variance and complexity of the observed individual situations, our interpretations can be neither exhaustive nor representative of all Chinese Ghanaian employment relations in the trade sector. However, we have presented archetypal examples of widespread perceptions and behavioural patterns of the parties involved. We have demonstrated that, beyond the racialized framing of crosscultural employment conflicts by both Chinese and Ghanaians in the airing of their structural dissatisfaction with each other, group-specific perceptions of vulnerability and risk have to be regarded as central elements for the understanding of the continuing and potentially conflictive negotiation of equity and reciprocity between employer and employee. The young and predominantly male Ghanaian employees, who usually lack both higher education and strong family ties in Accra that would allow this marginalized group alternative access to paid labour, rightly perceive their personal situation as existentially vulnerable both economically and psychologically. Not as obvious but nonetheless as justified as the Ghanaian employees perception of risk and vulnerability is the Chinese employers uncertain state of mind. Substantial private lending and mortgages as bases for highly speculative trading activities in an unfamiliar and potentially hostile environment, characterized by high initial and long-term investments, cut-throat competition with large numbers of compatriots as well as by frequent extortion by officials, constitute the existential economic risks that the Chinese merchants have to take in order to pursue their businesses abroad. Economically induced self-restriction that often results in the separation of Chinese entrepreneurs from their closest kin creates additional psychological uncertainty that may amplify their perception of vulnerability in a foreign land. In this situation, characterized by perceived vulnerabilities that actually lie beyond the particular employment relationship, loyalty signified by symbolic acts is in high demand by both parties involved, but is not satisfactorily demonstrated. While Ghanaian employees expect regular gifts and concessions that symbolically ensure them of the social security provision that is inscribed into the role of the employer by pervasive social norms, the Chinese employer expects the employee to display his loyalty through commitment and dedication to work. Since both expectations regarding reciprocity deriving from different social universes are not (fully) satisfied, psychological contracts are easily perceived as violated and equity as distorted. In our two-sided analysis of the re-negotiation of allegedly violated psychological contracts and distorted equity, we

Downloaded by [99.165.65.11] at 07:54 09 October 2013

16 Karsten Giese and Alena Thiel

have demonstrated that demands for pay rises, tips and allowances on the one hand, and for proactivity, dedication, industriousness and honesty on the other, constitute symbolic though largely futile appeals to perform loyalty and for protection against perceived vulnerability, rather than attempts to unilaterally change the purely economic terms of the exchange relationship. Therefore, different concepts of the acts and practices that symbolically signify loyalty are the foundation to understanding the malfunctioning of Chinese Ghanaian exchange relations in employment. Deprived of gifts and allowances or concessions with regard to social obligations, Ghanaian employees feel that their Chinese employers lack any understanding of and empathy for the vulnerability that many of them perceive as threatening their social and material survival. Without alternatives for generating income, they strive for the recognition of their existential fears by extorting additional monetary benefits (tips, extras, theft) from their employers, where the latter fail to perform expected symbolic acts that would signify their willingness to protect their subordinates. Without being related to their employees by kinship ties or other bonds of affection, the Chinese merchants, however, do not recognize themselves as providers of fully fledged social security, nor do they feel obliged to take up responsibilities that are usually attributed to close relatives, according to their own social logic. Extending such privileges to alien employees who moreover fail to demonstrate their dedication and loyalty to them and their businesses seems unjustifiable. In the large majority of observed cases, the involved parties are unable to gain a deeper understanding for the cultural other and eventually smooth the relationship. Most of our informants remain caught within their own framework of pervasive norms and practices and hence are blind to any interpretation of the particular crosscultural setting in which they are operating. Under these conditions many Chinese employers and Ghanaian employees tend to racialize the discourse, because patterns of dissatisfaction and conflict similar to their own are widely observable in almost all the Chinese trading enterprises employing Ghanaians in the central market area of Accra. The verbalization of discontent, demonstrative retreat and acts of destruction by employees as well as the employers refusal to make symbolic concessions are generally ascribed to moral deficiencies of either the African or the Chinese. Even in the rare cases where actors seem to have gained more structural insights, practices are adjusted only within their own system of reference: the Chinese employer who justified the introduction of a piecework system as providing his employees with a better opportunity for taking individual precautions against economic emergencies is the most blatant example.

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

17

Notes
1. Research for this publication has been conducted as part of the ongoing project Entrepreneurial Chinese Migrants and Petty African Entrepreneurs Local Impacts of Interaction in Urban West Africa funded by the DFG Priority Programme Adaptation and Creativity in Africa. 2. According to International Labour Organization (ILO 2008) statistics, average monthly wages in Ghanas retail and wholesale trade are around GH70 120 (Ghana cedis) (with higher wages being paid in the wholesale segment), thus often formally undercutting the legal minimum daily wage currently xed at GH3.73 (approx. US$2.50).

References
BAAH, ANTHONY YAW and JAUCH, HERBERT (eds) 2009 Chinese Investments in Africa: A Labour Perspective, Accra: African Labour Research Network BALDRY, CHRISTOPHER 1994 Convergence in Europe: a matter of perspective?, Industrial Relations Journal, vol. 25, no. 2, pp. 96 111 BAMBER, GREG and LANSBURY, RUSSELL D. 1998 International and Comparative Employment Relations: A Study of Industrialised Market Economies, London: SAGE BLAU, PETER M. 1964 Exchange and Power in Social Life, New York: John Wiley & Sons BROOKS, ANDREW 2010 Spinning and weaving discontent: labour relations and the production of meaning at Zambia-China Mulungushi Textiles, Journal of Southern African Studies, vol. 36, no. 1, pp. 113 32 BUCHAN, NANCY R., CROSON, RAHEL T. R. and DAWES, ROBIN M. 2002 Swift neighbors and persistent strangers: a cross-cultural investigation of trust and reciprocity in social exchange, American Journal of Sociology, vol. 108, no. 1, pp. 168 206 CHANT, SYLVIA and JONES, GARETH A. 2005 Youth, gender and livelihoods in West Africa: perspectives from Ghana and The Gambia, Childrens Geographies, vol. 3, no. 2, pp. 185 99 CHARLES, PIERRE 1952 Tribal society and labour legislation, International Labour Review, vol. 65, no. 4, pp. 425 41 CHEN, ZHEN XIONG, ARYEE, SAMUEL and LEE, CYNTHIA 2005 Test of a mediation model of perceived organizational support, Journal of Vocational Behavior, vol. 66, no. 3, pp. 457 70 CLARK, GRACIA 1994 Onions are my Husband: Survival and Accumulation by West African Market Women, Chicago, IL: Chicago University Press COLLIER, PAUL and GARG, ASHISH 1999 On kin and wages in the Ghanaian labour market, Oxford Bulletin of Economics and Statistics, vol. 61, no. 2, pp. 133 51 DEBRAH, YAW A. 2001 Human resource management in Ghana, in Pawan S. Budhwar and Yaw A. Debrah (eds), Human Resource Management in Developing Countries, London: Routledge, pp. 190 208 DOBLER, GREGOR 2009 Chinese and the formation of a Chinese expatriate community in Namibia, China Quarterly, vol. 199, pp. 707 27 GABRENYA, WILLIAM K., JR. and HWANG, KWANG-KUO 1996 Chinese social interaction: harmony and hierarchy on the good earth, in Michael Harris Bond (ed.), The Handbook of Chinese Psychology, Oxford: Oxford University Press, pp. 309 21 GEURTS, SABINE A., SCHAUFELI, WILMAR B. and RUTTE, CHRISTEL G. 1999 Absenteeism, turnover intention and inequity in the employment relationship, Work & Streets, vol. 13, no. 3, pp. 253 67 GHANA INVESTMENT ACT 1994 Retrieved from: http://www.gipcghana.com/publications/1318871581_Investment_Law070627114453.pdf Accessed 7 May 2012. GIPC (GHANA INVESTMENT PROMOTION CENTRE) 2011 Top 10 Country Investors Classied by Sectors, received personally on 2 February 2011 in Accra

Downloaded by [99.165.65.11] at 07:54 09 October 2013

18 Karsten Giese and Alena Thiel

GOULDNER, ALVIN W. 1960 The norm of reciprocity: a preliminary statement, American Sociological Review, vol. 25, no. 2, pp. 161 78 GSS (GHANA STATISTICAL SERVICE) 2008 Living Standards Survey: Report of the Fifth Round, Non-Farm Household Enterprise Module, Accra: GSS HO, CONAL GUAN-YOW 2008 The doing and undoing of community: Chinese networks in Ghana, China aktuell [Journal of Current Chinese Affairs], vol. 37, no. 3, pp. 45 76 HRW (HUMAN RIGHTS WATCH) 2011 Youll Be Fired if You Refuse: Labor Abuses in Zambias Chinese State-Owned Copper Mines. Available from: http://www.hrw.org/sites/ default/les/reports/zambia1111ForWebUpload.pdf [Accessed 30 April 2012] ILO (INTERNATIONAL LABOUR ORGANIZATION) 2008 Wages and hours of work in 159 occupations (ILO October Inquiry). Available from: http://laborsta.ilo.org [Accessed 30 April 2012] JACKSON, TERENCE 2002 Reframing human resource management in Africa: a crosscultural perspective, The International Journal of Human Resource Management, vol. 13, no. 7, pp. 998 1018 MCFARLANE SHORE, LYNN and TETRICK, LOIS E. 1994 The psychological contract as an explanatory framework in the employment relationship, in Cary L. Cooper and Denise M. Rousseau (eds), Trends in Organizational Behavior Vol. 1, New York: John Wiley & Sons, pp. 91 109 MOHAN, GILES and TAN-MULLINS, MAY 2009 Chinese migrants in Africa as new agents of development? An analytical framework, European Journal of Development Research, vol. 21, no. 4, pp. 588 605 MOUMOUNI, GUILLAUME 2010 Chinas relations with African sub-regions: the case of West Africa, The Bulletin of Fridays of the Commission, vol. 3, no. 1, pp. 25 43 MURPHEY, KEVIN R. and CLEVELAND, JEANETTE N. 1991 Performance Appraisal: An Organizational Perspective, Boston, MA: Allyn and Bacon , RAGNHILD 2007 When men do womens work: structural adjustment, OVERA unemployment and changing gender relations in the informal economy of Accra, Ghana, Journal of Modern African Studies, vol. 45, no. 4, pp. 539 63 PEIL, MARGARET 1970 The apprenticeship system in Ghana, Africa, vol. 40, no. 2, pp. 137 50 POT, FERRIE 2000 Employment Relations and National Culture: Continuity and Change in the Age of Globalization, Cheltenham: Edward Elgar ROBINSON, SANDRA L., KRAATZ, MATTHEW S. and ROUSSEAU, DENISE M. 1994 Changing obligations and the psychological contract: a longitudinal study, Academy of Management Journal, vol. 37, no. 1, pp. 137 52 ROBINSON, SANDRA L. and ROUSSEAU, DENISE M. 1994 Violating the psychological contract: not the exception but the norm, Journal of Organizational Behavior, vol. 15, no. 3, pp. 245 59 ROUSSEAU, DENISE M. 1990 New hire perceptions of their own and their employers obligations: a study of psychological contracts, Journal of Organizational Behavior, vol. 11, no. 5, pp. 389 400 ROUSSEAU, DENISE M. 1996 Psychological Contract in Organizations: Understanding Written and Unwritten Agreements, Newsbury Park, CA: SAGE SALANCIK, GERALD R. and PFEFFER, JEFFREY 1978 A social information processing approach to job attitudes and task design, Administrative Studies Quarterly, vol. 23, no. 2, pp. 224 53 SAUTMAN, BARRY and YAN, HAIRONG 2007 East Mountain Tiger, West Mountain Tiger: China, the West, and Colonialism in Africa, Baltimore, MD: Maryland Series in Contemporary Studies SHORE, LYNN M., et al. 2006 Social and economic exchanges: construct development and validation, Journal of Applied Social Psychology, vol. 36, no. 4, pp. 837 67

Downloaded by [99.165.65.11] at 07:54 09 October 2013

The vulnerable other distorted equity in Chinese Ghanaian employment relations

19

Downloaded by [99.165.65.11] at 07:54 09 October 2013

SOFER, CYRIL 1954 Working groups in a plural society, Industrial and Labor Relations Review, vol. 8, no. 1, pp. 68 78 TSUI, ANNE S. and FARH, JIING-LIH LARRY 1997 When guanxi matters: regional demography and guanxi in the Chinese context, Work and Occupations, vol. 24, no. 1, pp. 56 79 UTOMI, PAT 2008 China and Nigeria, in Jennifer Cooke (ed.), U.S. and Chinese Engagement in Africa: Prospects for Improving U.S. China Africa Cooperation, Washington, DC: Center for Strategic and International Studies VELENCHIK, ANN D. 1995 Apprenticeship contracts, small enterprises, and credit markets in Ghana, World Bank Economic Review, vol. 9, no. 3, pp. 451 75 WANG, CAROL and FLAM, DANIELLE 2007 Bridging the gap: experience and attitudes in Sino-African relations, China Rights Forum, no. 2, June, pp. 196 208 WANG, DUANXU, et al. 2003 Employment relationships and rm performance: evidence from an emerging economy, Journal of Organizational Behavior, vol. 24, no. 5, pp. 511 35 WESTWOOD, ROBERT, CHAN, ANDREW and LINSTEAD, STEPHEN 2004 Theorizing Chinese employment relations comparatively: exchange, reciprocity and the moral economy, Asia Pacic Journal of Management, vol. 21, no. 3, pp. 365 89 WU, JOSHUA B., et al. 2006 The norm of reciprocity: scale development and validation in the Chinese context, Management and Organization Review, vol. 2, no. 3, pp. 377 402 XIN, KATHERINE R. and PEARCE, JONE L. 1996 Guanxi: connections are substitutes for formal institutional support, Academy of Management Journal, vol. 39, no. 6, pp. 1641 58 YANG, MAYFAIR MEI-HUI 1994 Gifts, Favors and Banquets: The Art of Social Relationship in China, Ithaca, NY: Cornell University Press

KARSTEN GIESE is Senior Research Fellow at GIGA Institute of Asian Studies. ADDRESS: GIGA Institute of Asian Studies, Rothenbaumchaussee 32, D-20148 Hamburg, Germany. Email: giese@giga-hamburg.de ALENA THIEL is Junior Research Fellow at GIGA Institute of African Affairs. ADDRESS: GIGA Institute of African Affairs, Neuer Jungfernstieg 21, D-20354 Hamburg, Germany. Email: thiel@giga-hamburg.de

20 Karsten Giese and Alena Thiel

Appendix A: Interviews in Accra Interviewees have been coded and anonymized in order to protect their privacy and interests. The codes are chosen to provide the following general information about the informants: C G T E c g b e f Chinese business Ghanaian business trade external service provider Chinese individual Ghanaian individual owner employee family member

Downloaded by [99.165.65.11] at 07:54 09 October 2013

CTcb103 (2011), 11 February CTcb112 (2011), 10 February CTcb128 (2011), 11 February CTcb130 (2011), 19 February CTcb131 (2011a), 1 February CTcb131 (2011b), 4 February CTcb141 (2011), 21 February CTcb152 (2011), 18 February CTcb161 (2011a), 12 February CTcb161 (2011b), 17 February CTcbf100 (2011), 4 February CTcbf122 (2011), 14 February CTcbf162 (2011), 17 February CTcbf165 (2011), 22 February CTcbf164 (2011), 12 February CTcbf166 (2011), 12 February CTce107 (2011), 12 February CTce168 (2011), 1 February CTge16 (2011), 8 February CTge25 (2011), 17 February CTge27 (2011), 18 February CTge28 (2011), 20 February CTge30 (2011), 21 February CTge33 (2011), 21 February CTge36 (2011), 25 February GTgb2 (2011), 28 January GTgb7 (2011), 2 February