updated 3/30/2007 1:13:08 PM ET 2007-03-30T17:13:08

Labor officials in China's southern province of Guangdong said Thursday they are investigating reports that fast-food chains like McDonald's and KFC pay their part-time workers less than the minimum wage of about $1 an hour.

McDonald's and Yum Brands Inc. spokesmen in China responded by saying their companies abided by the law but were seeking clarification about regulations for part-time workers, especially for students.

A spokesman for the Guangdong Provincial Labor and Social Security Department said officials were looking into reports from workers and local media that staff in the fast-food outlets were being paid up to 40 percent less than the local minimum wage.

"If those foreign companies are actually violating our labor law, they will definitely get punished according to the relevant laws and rules," said the spokesman, who like many Chinese would give only his surname, Zhang.

"I can't comment much since now since we don't have the results yet," Zhang said.

The claims first surfaced in a report by the local newspaper New Express Daily, which said its reporters, posing as job applicants, found that McDonald's, KFC and Pizza Hut were paying part-time staff as much as 40 percent less than the minimum wage for Guangdong.

Minimum wages vary from region to region in China. The minimum wage for Guangdong province is 7.5 yuan ($0.97) per hour.

The New Express Daily report said McDonald's was paying part-timers only 4 yuan ($0.52) per hour. It said part-timers at KFC earned as 4.7 yuan ($0.61) and Pizza Hut 5 yuan ($0.65).

The report also accused the restaurants of demanding part-time employees work the hours of full-time staff but failing to pay them any full-time staff benefits.

Neither McDonald's nor Yum, which operates both KFC and Pizza Hut, responded directly to the allegations regarding their wage rates.

But McDonald's issued a statement Thursday saying that staff from its unit McDonald's Guangdong Co. were meeting with local labor officials to "clarify our crew source and employee systems now."

"We commit ourselves to providing employees with equal work opportunity, aspiring and safe working environment and full range of career development," the McDonald's statement said.

"As a fully responsible employer, we always follow the relevant government laws and rules. We offer our employees wages which meets the country's relevant standards," it said.

Yum Brands issued a statement saying the allegations resulted from confusion over whether the laws pertaining to part-time workers included students, who according to the New Express Daily constitute 70 percent of part-time staff in such fast-food outlets.

"This was caused by a newly introduced regulation. We are working with the government to seek clarification of these laws," it said. "Yum has always strictly adhered to Chinese laws and regulations."

It was unclear if there was some reason why students would be exempt from labor laws. However, labor officials in Guangdong said that as of Jan. 1, the minimum wage applied to both part- and full-time workers.

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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