Kraft Foods (China) Co. has been accused of violating the country's new labor law for the decision of shifting its headquarters from Beijing to Shanghai without consulting employees.

"The company has not asked for our opinions before making the decision," the Beijing News quoted an unnamed staff member as saying on Tuesday.

If the company moved to Shanghai, about two-thirds of the 300 workers may lose their job because of a reluctance to leave their families, the newspaper cited Chen Baoqing, chairman of the company's labor union, as saying.

Kraft has been considering moving its headquarters to Shanghai after it bought the biscuit and snacks division of Danone in November. It announced the move on January 24 without giving any explanations. The fallout was widespread criticism from its employees.

According to China's new labor law, a company is required to consult with its staff before making any major decisions that may affect employee interests.

While the company is to pay higher compensation to those who would have to quit, it should apologize for ignoring workers' opinions, Chen said.

The company promised to respond to the issue over the next two days, Li Lingping, a company spokeswoman said on Monday.

Kraft, the world's second largest food and beverage corporation after Nestle, entered the Chinese market in 1984. It set up its Beijing headquarters in 2006.

(Xinhua News Aegncy March 12, 2008)