China's e-commerce boom tough on couriers

Above: Couriers with a pile of packages to be delivered in Beijing. Below: Mr Li Pengbo, who works for Best Express, making his delivery rounds. There are 1.2 million couriers in China, according to one survey. They earn low wages and work long hours
Couriers with a pile of packages to be delivered in Beijing.PHOTO: NYTIMES
Above: Couriers with a pile of packages to be delivered in Beijing. Below: Mr Li Pengbo, who works for Best Express, making his delivery rounds. There are 1.2 million couriers in China, according to one survey. They earn low wages and work long hours
Mr Li Pengbo, who works for Best Express, making his delivery rounds. There are 1.2 million couriers in China, according to one survey. They earn low wages and work long hours under harsh conditions.PHOTO: NYTIMES

In a business where every second counts, work can be low-paying with few benefits

BEIJING • Mr Zhang Heng barged through an exam-room door, surprising a doctor and a patient. He did not have time to knock.

In Mr Zhang's business, every second counts.

"You have to hand it directly to the person," said Mr Zhang, one of the legions of package couriers in Beijing who are helping to power China's online shopping boom.

He spoke as he blitzed through a surgical wing, medical storeroom and patient ward delivering parcels small and large, soft and square, to doctors and nurses in an effort to ensure the right person gets the right package. "Otherwise," Mr Zhang said, "you may get fined."

The Chinese e-commerce industry has been built on the backs of couriers - called kuaidi, or express delivery, in China - like Mr Zhang.

They number 1.2 million, according to one survey, and online retailers like Alibaba use them to zip packages to customers by scooter or three- wheeled electric cart.

Across China, the world's largest market for package delivery, a courier shouting "kuaidi!" through a door or a phone signals your package has arrived.

But for the couriers, the work can be low-paying and difficult. It is coming under scrutiny from labour activists and legal experts who say many couriers face punishing hours and harsh conditions.

Labour standards in the industry vary widely, but many couriers work under arrangements that might, for example, provide no overtime pay, or no employer contributions to their government healthcare and pension benefits, raising questions about what defines work and employment.

 

Couriers also complain about fines. Some delivery companies penalise them if they do not deliver all the morning's packages by 2pm.

Poor penmanship, damage to a package or customer complaints can also result in fines, which can add up to a week's pay.

"I'm here to make money," said Mr Zhang, 28, a former coal miner from Shanxi province who is saving up to build a home, widely seen as indispensable in attracting a wife in the countryside. "If I'm not diligent now, I'm going to regret it. I'm almost 30 and still single."

China hopes to move away from manufacturing and seeks to build a more service-oriented economy driven by accountants, lawyers and other professionals. Yet for migrant workers at the bottom of the pay scale, service work can mean conditions not unlike those in China's factories, where lax enforcement has long led to excessive overtime and unsafe conditions.

Some couriers work directly for companies such as JD.com, an e-commerce retailer, or SF Express, a delivery service. Others drive for a group of delivery companies that dominate the business of ferrying packages on behalf of online retailers like Alibaba.

One of those companies, ZTO Express, raised US$1.4 billion (S$2 billion) in a share offering on the New York Stock Exchange last year.

Those companies run nationwide distribution networks but rely on smaller companies for last-mile delivery - and there the relationships can become murky. Those smaller companies, which are franchisees of the big delivery companies, sign up drivers as employees or contractors. Some of those drivers subcontract their work to other drivers.

Those arrangements often result in couriers who drive under the name of a big delivery company, but whose hours and terms are only loosely managed, experts said.

For example, many drivers lack workers' compensation benefits or insurance in case of accidents, said Professor Jin Yingjie, who specialises in labour law at the China University of Political Science and Law.

Delivery companies "should work to bring the industry into the confines of the labour law", she said.

The work initially appealed to many as package volume boomed.

However, their pay per package has barely budged in recent years as competition intensified and more drivers entered the market.

Still, some thrive. Mr Li Pengbo, 21, from Henan province, drives for Best Express, another large delivery company in which Alibaba owns a stake. He dominates the area he subcontracted from a Best Express franchisee, he said, and earns about US$2,000 a month. "Since the sixth day of the last Chinese New Year until now, I haven't rested, not a single day," he said, describing an 11-month stretch.

"I work from 6.30 in the morning until 11 or 12 at night. My family is poor. This bitterness is nothing compared to what they've gone through," he said.

NYTIMES

A version of this article appeared in the print edition of The Straits Times on February 02, 2017, with the headline 'China's e-commerce boom tough on couriers'. Print Edition | Subscribe