US factory boss Chip Starnes freed from China factory after being held hostage for nearly a week

A local official said an agreement of pay was reached with "mutual satisfaction"

Chip Starnes was held hostage for nearly a week (AP)

A US businessman who was detained in his own factory in China by his employees for nearly a week was released today after the dispute was solved.

Chip Starnes, president of pharmaceutical company Specialty Medical Supplies, was reportedly barricaded in the Beijing factory on Friday after workers complained over pay arrears, with some claiming to have not been paid for two months.

Local labour official Chu Lixiang said in an earlier interview that staff feared the plant was closing and remaining employees would be left without severance payments.

“Both sides have come to an agreement through joint efforts made by Mr Starnes and the workers' side,” he said later. “The results have turned out to be satisfactory.”

Speaking briefly after being released, Mr Stanes said the experience was “humiliating” and “embarrassing” and explained that workers blocked all exits and prevented him from sleeping by banging on doors and windows.

The company’s general manager added: “As of now my boss Chip feels exhausted after two harsh days and has gone back to a hotel. This is all I have to say.”

Local police reportedly did not intervene because they believed the matter was a civil dispute for the two sides to resolve themselves.