Labor Law

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By Brian Arbetter and Terese Connolly 

China has a new employment law. This new law significantly impacts an employer who does not directly employ its own workers, but instead uses agencies such as FESCO or third party staffing companies, also known as labor dispatching agencies. At the end of 2012, the Standing Committee of the National People’s Congress adopted the Decision on the Revision of the Labor Contract Law of the People’s Republic of China (“Amendment”). The Amendment will take effect July 1st of this year. The intent of the Amendment is to offer better protection to workers employed by labor dispatching agencies.

Labor dispatching is a common method of employment where a worker enters into an employment contract with a labor dispatch agency and is then dispatched to work in another company – commonly referred to as the “host company”. This type of employment arrangement has proved problematic because many of the dispatched workers are not paid wages commensurate with their work as compared to their direct hire, permanent employee counterparts. Additionally, the dispatched workers’ health and safety rights are not well protected. The Amendment tackles this problem by requiring employers to hire the majority of their workforce directly and by strictly controlling the number of dispatched laborers. Moreover, the Amendment clearly states that all employers shall stick to the principle of “equal pay for equal work”. Continue Reading China Enacts New Employment Law Affecting Employers Who Do Not Directly Employ Their Workers

By Xinlan Liu

The most important issue for foreigners working in China is to apply for work and resident permits with Chinese authorities. Compare with the procedures and documents required for foreigners who work for a foreign enterprise’s representative office in China, those for the foreigners working for foreign invested enterprises are more complicated and time consuming. Let’s take the latter as an example to provide some general and useful information on the work and resident permit applications for foreigners working in China.Continue Reading Work and Resident Permit Applications of Foreign Employees in China

By Sharon Xu 

Employers need be aware of a recent interpretation issued by the PRC Supreme Court which clarifies a number of employment issues related to service year, non-competition, amendment to employment contract and employment relationship of foreign individual. The PRC Supreme People’s Court issued the Interpretation on Several Issues concerning the Application of Laws in Labor Dispute Case (IV) (the “Interpretation”) on January 18, 2013 which became effective on February 1, 2013.Continue Reading Supreme People Court’s Interpretation on Employment Law Issues

By Russell Leu 

Employers in China who intentionally default on making payment to their workers beware. It is no coincidence that China’s People’s Supreme Court issued a Judicial Interpretation on January 22, 2013, made effective on January 23, 2013, which further clarified the 2011 amendment to the criminal law making the intentional failure to pay wages a crime. With the coming of Chinese New Year and Spring Festival holidays, the Judicial Interpretation is particularly targeted at employers who default on making wage payments to migrant workers who are often victims.Continue Reading Employers Beware-Newly Issued Judicial Interpretation Resolves Ambiguity Under The Criminal Law For Failure To Pay Wages

The global economic downturn has impacted employers in China and, as with their U.S. counterparts, some of them are conducting mass layoffs in order to reduce costs. In addition to complying with layoff-related requirements under the PRC Labor Law, employers in China should take note of new local laws related to layoffs, and take steps to ensure compliance therewith.Continue Reading Beware of Local Layoff Procedures

Since 2008, China has taken into effect three new Labor laws: Labor Dispute’s Mediation and Arbitration Law, Employment Agreement Law, and Implementation Regulations on the Employment Agreement Law.  These new labor laws are measures taken by the government to assist in China’s transition of economy and society.  The new laws will strengthen the protection of employee’s legal rights and balance the relationship between the employer and the employee. They will severely punish the employer who violates any labor regulations, like the lack of written employment agreements, violation of the prevailing wage standard, postponed or reduced wage payments, or wrongful employment termination.  In particular, foreign investors in China should pay close attention to these changes.
Continue Reading China Enforces New Labor Law

After promulgating the Labor Contract Law, the Chinese legislature enacted the Law on Labor Dispute Mediation and Arbitration (hereinafter referred to as “the New Law”) to further safeguard the rights and interests of worker in procedural matters. The New Law took effect on May 1, 2008.

As the first law that specially regulates labor disputes between employers and employees in China, this New Law imposes more burdens and obligations on employers, making it seem pro-worker. But, is that an accurate perception?Continue Reading The New PRC Law On Labor Dispute Arbitration Is Not So Pro-worker