A large number of automotive trim company workers in Shanghai city of China recently blocked a major highway in the city amid massive layoff threats, media reports said.

The workers from the state-owned Shanghai Guoli Automotive Leather Decoration Co. scuffled with police as traffic backed up on the Husong Highway, according to video clips of the standoff posted to social media as quoted by Radio Free Asia.

Police have detained at least one worker so far.

Employees have been protesting since receiving a notice on Oct. 9 offering a payout of three months' minimum wage to anyone who volunteered to resign, amounting to a total of payment 8070 yuan (US$1,113), Radio Free Asia reported.

Social media posts from people identifying themselves as workers from the company said the “voluntary resignations” weren’t actually voluntary, and that the company had described the layoff terms as “generous,” according to posts to X by citizen journalist “Mr Li is not your teacher.”

The protesting workers even argued that they are entitled to three months' compensation based on their average wage over the previous 12 months.

This is one clear incident of labour dispute reported from China amid the struggle the country's economy is facing since COVID-19 lockdown was lifted.

A quarterly report from Washington DC-based Freedom House said that China saw “a 27 percent year-on-year increase in dissent events” between July 1 and Sept. 30, reported Radio Free Asia.