Chip Starnes, 42, the founder and president of Specialty Medical Supplies, a Florida company that manufactures insulin syringes and other medical devices, was visiting a manufacturing site in Huairou, China, a district of Beijing. The company had recently announced it was closing down a production line at the factory and laying off 30 people.
Starnes said his company offered workers a "generous" severance package but rumors spread through the rest of the factory's 100 or so workers Starnes planned to close the entire factory and leave town before paying the rest of the workers.
That prompted employees to barricade exits and interrogate Starnes. The New York Times said Starnes, who has been inside the factory since Friday, has been subjected to sleep depravation and the workers' union has forced him to promise severance packages to all workers despite the company's assurances all the remaining jobs are safe.
In an interview with the Times Tuesday, Starnes said paying everyone a severance package would be tantamount to committing "business suicide" -- and would bankrupt the company.
Workers have said they are owed back wages -- a claim Starnes flatly denied.
American diplomats have visited Starnes but said there's little they can do under Chinese law other than check on his general welfare and ensure he has access to legal counsel.
Chinese laws generally favor employers and economic development over workers' rights. That climate makes these kinds of stalemates -- and worse, outright violence by workers who have gotten a raw deal -- somewhat common, the Times said.
Chinese officials said Starnes is not in any danger.
"He is completely free within the factory. It's just that he has stuff to do," said Chu Lixiang, an official with the government-run labor union in Huairou.