U.S. boss held captive in China leaves plant after payout

BEIJING » An American boss detained nearly a week by his company’s Chinese workers left the Beijing factory Thursday after he and a labor representative said the two sides reached agreement in a pay dispute.

Chip Starnes, who said he was "saddened" by the experience, told The Associated Press a deal was reached overnight to pay the scores of workers who had demanded severance packages similar to ones given to laid-off co-workers in a phased-out division, even though the company said the remaining workers weren’t being laid off.

Remaining workers at the medical supply plant in Huairou district, on the outskirts of Beijing, had said they believed the entire factory was shutting down, that the company owed unpaid salary and that they saw equipment being packed and itemized for shipping to India.

Starnes said the workers’ demands were unjustified. Neither he nor district labor official Chu Lixiang gave details of the agreed compensation. Chu said all the workers would be terminated, and Starnes said some of them would be rehired later.

"It has been resolved to each side’s satisfaction," Chu told reporters at a conference room at the plant in late morning. She said they had been sorting out paperwork until 5 a.m. and that 97 workers had signed settlement agreements.

Starnes, a co-owner of Florida-based Specialty Medical Supplies, had quietly departed the factory grounds by the time Chu spoke, returning to his hotel in Beijing.

"Yes!! Out and back at hotel," Starnes wrote in a text message. "Showered… 9 pounds lost during the ordeal!!!!!!"

Police in Huairou district had made no moves to halt the labor action but guarded the plant and said they were guaranteeing Starnes’ safety while local labor officials brokered negotiations.

It is not rare in China for managers to be held by workers demanding back pay or other benefits, often from their Chinese owners. Police are reluctant to intervene, as they consider it a business dispute, and local officials typically are eager to see the matter resolved in the way least likely to fuel unrest.

The labor action reflected growing uneasiness among workers about their jobs amid China’s slowing economic growth and the sense that growing labor costs make the country less attractive for some foreign-owned factories.

About 80 workers had started blocking all exits starting last Friday, and Starnes had spoken to reporters in recent days through the barred window of his factory office.

Earlier Thursday, he said in a telephone interview that he had been forced to give in to what he considered unjustified demands. He summed up the past several days as "humiliating, embarrassing." At the beginning of his captivity, workers had deprived him of sleep by shining bright lights and banging on windows of his office, he said.

"We have transferred our funds from the U.S.," he said. "I am basically free to go when the funds hit the account here of the company."

Starnes told the AP he planned to get back to business, and even rehire some of the workers who had been holding him. "We’re going to take Thursday off to let the dust settle, and we’re going to be rehiring a lot of the previous workers on new contracts as of Friday," he said.

Starnes previously said the company had been winding down its plastics division, with plans to move it to Mumbai. When he arrived in Beijing last week to lay off the last 30 people, workers in other divisions started demanding similar severance packages.