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Last Updated: Monday, 2 April 2007, 09:38 GMT 10:38 UK
Chinese probe into fast-food pay
McDonald's restaurant in Beijing
McDonald's employs 50,000 workers in China
Authorities in China are reportedly investigating claims that foreign fast-food chains have underpaid staff.

Salaries paid to part-time workers at McDonald's, Pizza Hut and KFC are under scrutiny in southern China, the People's Daily paper reported.

China's official trade union has threatened legal action if the firms are found to have broken the law.

McDonald's and Yum Brands, owner of KFC and Pizza Hut, denied the claims and said they abided by labour regulations.

Pay row

McDonald's and Yum Brands have been expanding rapidly across China.

Within China, there are no privileged businesses
Li Shouzen, All-China Federation of Trade Unions

But reports first surfaced in newspapers in Guangzhou last week that outlets in the city have been underpaying staff.

Under state law, workers must be paid a minimum of 7.5 yuan (97 cents) an hour but it was alleged that certain staff were only receiving four to five yuan.

The state-owned People's Daily reported that officials were investigating these allegations and similar claims about other outlets across the state.

Union anger

The Chinese economy relies on thousands of part-time workers, many of whom earn subsistence wages, work in dangerous conditions and have no union representation.

But the Chinese authorities are keen to see wage regulations enforced as raising average income levels is vital if the country's economic growth is to be maintained.

China's state-run union, which has not historically lobbied for higher wages, said it would take action against any business found to be exploiting its workers.

"Within China, there are no privileged businesses," the New Express newspaper quoted Li Shouzen, an official from the All-China Federation of Trade Unions, as saying.

"If there really are unlawful employment practices and they refuse to correct their mistakes, the union will complain to labour inspection agencies and demand investigation and punishment according to the law."

McDonald's employs 50,000 staff at its 790 restaurants in mainland China while Yum Brands retains 100,000 workers.

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