China's Most Current Labor Laws - A Summary

An Expert's View about Law and Compliance in China

Last updated: 9 Nov 2011

Before you start hiring Chinese employees, executives, or sub-contractors, read this basic summary on Chinese labor laws or you may have some unpleasant and costly surprises!

PRC, Labour Contract Law Ref no: 2400/2007.06.29 (Promulgated by the 28th Session of the Standing Committee of the 10th National People?s Congress on 29 June 2007 and effective as of 1 January 2008.) CHAPTER ONE: GENERAL PRINCIPLES Article 1: This Law is formulated for the purposes of refining the labour contract system, specifying the rights and obligations of both parties to a labour contract, protecting the legitimate rights and interests of workers and building and developing harmonious and stable labour relationships. Article 2: This Law shall apply to establishment of labour relationships between enterprises, individual economic organizations, private non-enterprise units etc (hereinafter referred to as the ?employment units?) in the People?s Republic of China and their workers and the conclusion, performance, variation, rescission or termination of labour contracts. Establishment of labour relationships between State agencies, business units, social organizations and their workers and conclusion, performance, variation, rescission or termination of labour contracts shall be carried out pursuant to this Law. Article 3: Conclusion of labour contracts shall comply with the principles of legality, equitableness, fairness, voluntary participation, negotiation and agreement and honesty and trustworthiness. Labour contracts concluded pursuant to the law shall be legally binding and the employment units and the workers shall perform the obligations stipulated in the labour contracts. Article 4: The employment units shall establish and improve upon labour rules and system pursuant to the law to ensure workers? entitlement to labour rights and performance of labour obligations. When the employment unit formulates, revises or decides on rules or major matters pertaining to labour remuneration, working hours, rest periods and off days, labour safety and health, insurance and welfare, staff training, labour discipline and labour quota administration etc which directly involves the vital interests of workers, such matters shall be discussed by the employee representatives congress or all staff who shall make proposal and give their opinion and the employment unit shall carry out equal negotiation with the labour union or employee representatives before making a decision. During the decision and implementation of rules and major matter, the labour union or staff shall have the right to raise their concern with the employment units on any inappropriate issues and such issues shall be corrected and refined through negotiation. The employment units shall announce decisions on rules and major matters which directly involve the vital interests of workers or notify the workers. Article 5: The labour administrative authorities of People?s Governments of county level and above shall, jointly with the labour unions and representatives of enterprises, establish a proper tripartite labour relationship coordination mechanism to jointly study and resolve major issues in relation to labour relationships. Article 6: Labour unions shall assist in and provide guidance for conclusion and performance of labour contracts between workers and employment units pursuant to the law and shall establish a collective negotiation mechanism with employment units to safeguard the legitimate rights and interests of workers. CHAPTER TWO: CONCLUSION OF LABOUR CONTRACT Article 7: The employment unit shall be deemed to have established a labour relationship with a worker with effect from the date of employment. The employment unit shall establish a register of employees for inspection purpose. Article 8: When recruiting a worker, the employment unit shall truthfully notify the worker of the job duties, working conditions, work premises, occupational hazards, safety and production conditions, labour remuneration and any other information in which the worker is interested to know; the employment unit shall have the right to ask about basic information of the worker in direct relation to the labour contract, the worker shall answer truthfully. Article 9: The employment unit recruiting workers shall not retain the identity card or other certificate of a worker or require a worker to provide guarantee or collect monies or properties from a worker under any pretext. Article 10: A written labour contract shall be concluded for the establishment of a labour relationship. Where a written labour contract is not concluded simultaneously with the establishment of a labour relationship, a written labour contract shall be concluded within one month from the date of employment. Where the employment unit and a worker have concluded a labour contract prior to employment, the labor relationship shall be established from the date of employment. Article 11: Where the employment unit fails to conclude a written labour contract for employment of a worker or where the labour remuneration agreed with a worker is unclear, the labour remuneration of a newly recruited worker shall be executed pursuant to the standard stipulated in the collective contract; where there is no collective contract or where there is no such provision in the collective contract, the same remuneration shall be paid for the same job position. Article 12: Labour contracts are divided into fixed-term labour contracts, non-fixed-term labour contracts and labour contracts which expire upon completion of agreed assignments. Article 13: A fixed-term labour contract shall refer to a labour contract for which the employment unit and the worker have agreed on the time of termination. Upon negotiation and consensus between the employment unit and the worker, a fixed-term labour contract may be concluded. Article 14: A non-fixed-term labour contract shall refer to a labour contract for which the employment unit and the worker have agreed that the date of termination is not fixed. Upon negotiation and consensus between the employment unit and the worker, a non-fixed-term labour contract may be concluded. Under any of the following circumstances, a worker may propose or agree to renewal or conclusion of labour contract; except where a worker proposes for the conclusion of a fixed-term labor contract, a non-fixed-term labour contract shall be concluded: 1. the worker has worked for the employment unit for a period of 10 years consecutively; 2. when the employment unit first implemented the labour contract system or when a new labour contract is concluded upon restructuring of a State-owned enterprise, the worker has worked for the employment unit for a period of 10 years consecutively and will attain his/her statutory retirement age in less than 10 years? time; or 3. where a fixed-term labour contract has been concluded twice consecutively and the worker who does not fall under any of the categories stipulated in Article 39 and item (1) and item (2) of Article 40 hereof renews his/her labour contract. Where the employment unit fails to conclude a written labour contract with a worker after one year has lapsed since the date of employment, the employment unit and the worker shall be deemed to have concluded a non-fixed-term labour contract. Article 15: A labour contract which expires upon completion of agreed assignments shall refer to a labour contract between the employment unit and a worker for which the contract shall terminate upon completion of certain assignment. Upon negotiation and consensus between the employment unit and a worker, a labour contract which expires upon completion of agreed assignments may be concluded. Article 16: A labour contract shall be subject to negotiation and consensus between the employment unit and a worker and shall come into effect upon signing and affixation of seal by the employment unit and the worker on copies of the labour contract. The employment unit and the worker shall each hold a copy of the labour contract. Article 17: A labour contract shall include the following clauses? 1. name and address of the employment unit and the legal representative or key person-in-charge; 2. name, address and identity card number or other valid identity document number of the worker; 3. term of labour contract; 4. job duties and work premises; 5. working hours and rest periods and off days; 6. labour remuneration; 7. social security; 8. labour protection, working conditions and occupational hazard prevention and protection; and 9. any other matters to be included in a labour contract as stipulated by the laws and regulations. In addition to the essential clauses of a labour contract stipulated in the preceding paragraph, the employment unit and a worker may agreed on the probationary period, training, confidentiality, supplementary insurance and welfare and incentives etc. Article 18: Where a labour contract is unclear on the provisions for labour remuneration and working conditions etc that triggers a dispute, the employment unit and the worker may re-negotiate; where the negotiation is unsuccessful, the provisions of the collective contract shall apply; where there is no collective contract or where the collective contract has no provision on labour remuneration, the same remuneration shall be paid for the same job position; where there is no collective contract or where the collective contract has no provisions on working conditions etc, the relevant provisions of the State shall apply. Article 19: Where the term of a labour contract is more than three months but less than one year, the probationary period shall not exceed one month; where the term of a labour contract is more than one year but less than three years, the probationary period shall not exceed two months; for fixed-term contracts of three years and above and non-fixed-term labour contracts, the probationary period shall not exceed six months. The same employment unit and the same worker may only agree on probationary period once. For labour contracts which expire upon completion of agreed assignments or labour contracts with a term of less than three months, no probationary period shall be agreed upon. The probationary period shall form part of the term of the labour contract. Where a labour contract only stipulates a probationary period, the probationary period shall not stand, instead that period shall form the term of the labour contract. Article 20: The wage amount of a worker during his/her probationary period shall not be less than the lowest wage amount for the same job position in the same unit or 80% of the wage amount agreed in the labour contract and shall not be less than the minimum wage standard of the locality of the employment unit. Article 21: Except where a worker falls under any of the categories stipulated in Article 39 and item (1) and item (2) of Article 40 hereof during the probationary period, the employment unit shall not rescind the labour contract. Where the employment unit rescinds a labour contract during the probationary period of a worker, it shall explain the reason to the worker. Article 22: Where the employment unit bears special training expenses for a worker in providing professional technical training, it may conclude an agreement with the worker to stipulate a period of service. Where a worker breaches the agreement on period of service, he/she shall pay default penalty to the employment unit pursuant to the agreement. The amount of default penalty shall not exceed the training expenses borne by the employment unit. The amount of default penalty demanded by the employment unit from the worker shall not exceed the amount of training expenses to be amortized over the unperformed period of service. The agreement between the employment unit and a worker on a period of service shall not have any impact on the raise of labour remuneration during the period of service pursuant to normal wage increment mechanism. Article 23: The employment unit and a worker may agree on keeping confidentiality of the employment unit?s commercial secrets and confidential matters in relation to intellectual property in a labour contract. Where a worker is obliged to keep confidentiality, the employment unit may agree with the worker in a labour contract or confidentiality agreement on a non-competition restrictive covenant and agree that upon the rescission or termination of a labour contract, the employment unit shall grant the worker economic damages on a monthly basis during the non-competition restrictive covenant period. Where the worker has violated the non-competition restrictive covenant, he/she shall pay a default penalty to the employment unit pursuant to the agreement. Article 24: Personnel subject to non-competition restrictive covenant shall be limited to the employment unit?s senior management personnel, senior technical personnel and other personnel who are obliged to keep confidentiality. The scope, geographical region and duration of non-competition restrictive covenant shall be agreed between the employment unit and the worker; non-competition restrictive covenant shall not violate the provisions of laws and regulations. Upon rescission or termination of a labour contract, the non-competition restrictive covenant period in which the aforesaid stipulated personnel shall not be employed by another employment unit which engages in production or business in the same type of products or provision of the same type of services as the employment unit and shall not engage in his/her own production or business in the same type of products or provision of the same type of services as the employment unit shall not exceed two years. Article 25: Except for the circumstances stipulated in Article 22 and Article 23 hereof, the employment unit shall not agree with a worker on bearing of default penalty by the worker. Article 26: The following labour contracts shall be wholly or partially void: 1. a labour contract which is concluded or varied by use of fraudulent or coercive tactics or taking advantage of the counterparty?s unfavourable position to cause the counterparty to act against the real intention; 2. where the employment unit waives its statutory liabilities and exclude the worker from his/her rights; or 3. where the mandatory provisions of the laws and administrative regulations are violated. A dispute over a wholly or partly void labour contract shall be determined by a labour dispute arbitration institution or a People?s Court. Article 27: Where a labour contract is partly void and it does not affect the validity of other parts, other parts shall continue to be valid. Article 28: Where a labour contract is confirmed to be void and the worker has provided labour services, the employment unit shall pay labour remuneration to the worker. The amount of labour remuneration shall be determined with reference to the labour remuneration of a worker holding the same or similar position in the same employment unit. CHAPTER THREE: PERFORMANCE AND VARIATION OF LABOUR CONTRACT Article 29: The employment unit and a worker shall perform their respective obligations fully pursuant to the provisions of the labour contract. Article 30: The employment unit shall promptly pay labour remuneration to workers in full amount pursuant to the stipulations of the labour contract and the provisions of the State. Where the employment unit defaults on payment or fails to promptly pay labour remuneration in full amount, a worker may apply to a People?s Court of the locality for an order for payment and the People?s Court shall issue an order for payment pursuant to the law. Article 31: The employment unit shall strictly comply with the standard for labour quota and shall not coerce a worker or coerce a worker in a disguised way to work overtime. The employment unit which requires a worker to work overtime shall pay the worker overtime wages pursuant to the relevant provisions of the State. Article 32: Where a worker refuses to comply with any order of the management personnel of the employment unit which violates the rules or compels the worker to engage in risky work, such refusal shall not be deemed as a breach of the labour contract. A worker shall have the right to criticize, complain or file a lawsuit against the employment unit in respect of working conditions which endangers life safety and physical health. Article 33: Matters such as the change of name, legal representative, key person-in-charge or investors of the employment unit shall not affect the performance of a labour contract. Article 34: Where the employment unit undergoes a merger or division, the original labour contract shall continue to be valid and the succeeding employment unit which succeeds the rights and obligations of the predecessor employment unit shall continue to perform the labour contract. Article 35: Upon negotiation and consensus between the employment unit and a worker, the contents of a labour contract may be varied. Variation of a labour contract shall be made in writing. The employment unit and the worker shall each hold a copy of the varied labour contract. CHAPTER FOUR: RESCISSION AND TERMINATION OF LABOUR CONTRACT Article 36: Upon negotiation and consensus between the employment unit and a worker, a labour contract may be rescinded. Article 37: A worker may notify the employment unit with a 30-day advance notice in writing to rescind his/her labour contract. A worker may notify the employment unit with a three-day advance notice in writing during his/her probationary period to rescind his/her labour contract. Article 38: Under any of the following circumstances of an employment unit, a worker may rescind the labour contract: 1. where the employment unit fails to provide labour protection or labour conditions pursuant to the provisions of the labour contract; 2. where the employment unit fails to promptly pay labour remuneration in full amount; 3. where the employment unit fails to contribute social security premiums for the worker pursuant to the law; 4. where the rules and system of the employment unit violate the provisions of laws and regulations and are prejudicial to the worker?s rights and interests; 5. where the labour contract is rendered void under any of the circumstances stipulated in the first paragraph of Article 26 hereof; or 6. any other circumstances where the worker may rescind a labour contract as stipulated by the laws and regulations. Where the employment unit uses means such as violence, threat or illegal restriction of personal freedom to coerce a worker into provision of labour or where the employment unit gives orders which violate the rules or force a worker to engage in risky work which endangers the worker?s personal safety, the worker may immediately rescind the labour contract and shall not be required to give the employment unit advance notice thereof. Article 39: Under any of the following circumstances of a worker, an employment unit may rescind the labour contract: 1. where it is proven during the probationary period that the worker does not satisfy the employment criteria; 2. where the worker has committed a serious breach of the employment unit?s rules and system; 3. where the worker is guilty of serious dereliction of duties and corruption and causes the employment unit to suffer significant damages; 4. where the worker holds a labour relationship with another employment unit concurrently which has a severe impact on his/her performance of work tasks assigned by the employment unit or refuses to make correction as demanded by the employment unit; 5. where the labour contract is rendered void under the circumstances stipulated in item (1) of the first paragraph of Article 26 hereof; or 6. where criminal prosecution is instituted against the worker pursuant to the law. Article 40: Under any of the following circumstances, the employment unit may rescind the labour contract by giving the worker a written notice 30 days in advance or by making an additional payment of one month?s wage to the worker: 1. where the worker suffers from an illness or a non-work-related injury and is unable to undertake the original job duties or other job duties arranged by the employment unit following completion of the stipulated medical treatment period; 2. where the worker cannot perform his/her duties and remains to be incapable of performing the job duties after training or job transfer; or 3. where the objective circumstances for which the conclusion of the labour contract is based upon have undergone significant changes and as a result thereof, the labour contract can no longer be performed and upon negotiation between the employment unit and the worker, both parties are unable to reach an agreement on variation of the contents of the labour contract. Article 41: Under any of the following circumstances where the employment unit needs to retrench 20 or more employees or where the number of employees to be retrenched is less than 20 but comprises 10% or more of the total number of employees of the enterprise, the employment unit shall explain the situation to the labour union or all staff 30 days in advance and seek the opinion of the labour union or the employees, the employment unit may carry out the retrenchment exercise upon reporting the retrenchment scheme to the labour administrative authorities: 1. the employment unit undergoes restructuring pursuant to the provisions of the Enterprise Bankruptcy Law; 2. the employment unit has serious production and operation difficulties; 3. the enterprise undergoes a change of production, significant technological reform or change of mode of operation and upon variation of labour contract, there is still a need for retrenchment; or 4. the objective circumstances for which the conclusion of a labour contract is based upon have undergone significant changes and as a result thereof, the labour contract can no longer be performed. The following personnel shall be given priority to be retained in a retrenchment exercise: 1. a worker who has entered into a fixed-term labour contract of a longer period with the employment unit; 2. a worker who has entered into a non-fixed-term labour contract with the employment unit; or 3. a worker whose family members are not employed or who needs to support aged or under-aged family members. Where the employment unit which carries out a retrenchment exercise pursuant to the provisions of the first paragraph of this Article is re-hiring employees within six months shall notify the retrenched personnel and the retrenched personnel shall be given priority for employment under the same conditions. Article 42: Under any of the following circumstances of a worker, the employment unit shall not rescind a labour contract pursuant to the provisions of Article 40 and Article 41 hereof: 1. where a worker who has engaged in work exposed to occupational hazards has not undergone pre-termination of employment occupational health check or during the period where a worker is suspected to have contacted an occupational illness or under medical observation; 2. where a worker has contacted an occupational illness or suffered a work injury while working for the employment unit and is confirmed to have lost his/her labour capacity wholly or partially; 3. during the stipulated medical treatment period of a worker suffering from illness or non-work-related injury; 4. during the pregnancy, maternity leave or breastfeeding period of a female worker; 5. where a worker has worked for 15 years consecutively with the employment unit and will attain his/her statutory retirement age in less than five years? time; or 6. any other circumstances stipulated by the laws and administrative regulations. Article 43: The employment unit which unilaterally rescinds a labour contract shall notify the labour union of the reason beforehand. Where the employment unit violates the provisions of laws and administrative regulations or the labour contract, the labour union shall have the right to require the employment unit to make correction. The employment unit shall study the opinion of the labour union and notify the labour union in writing of the outcome. Article 44: Under any of the following circumstances, a labour contract shall be terminated? 1. the labour contract has expired; 2. the worker has started exercising his/her basic pension insurance entitlements; 3. the worker is dead or declared dead or missing by a People?s Court; 4. the employment unit is declared bankrupt pursuant to the law; 5. the employment unit?s business licence is revoked, the employment unit is ordered to close down, be revoked or has decided to dissolve prematurely; or 6. any other circumstances stipulated by the laws and administrative regulations. Article 45: Upon the expiry of a labour contract and under any of the circumstances stipulated in Article 42 hereof, the labour contract shall be extended and be terminated upon extinguishment of the corresponding circumstances. In the event of termination of a labour contract of a worker who has lost his/her labour capacity wholly or partially as stipulated in item (2) of Article 42 hereof, the case shall be dealt with pursuant to the provisions of the State on work injury insurance. Article 46: Under any of the following circumstances, the employment unit shall grant economic damages to the worker: 1. the worker has rescinded the labour contract pursuant to the provisions of Article 38 hereof; 2. the employment unit has proposed rescission of labour contract to the worker pursuant to the provisions of Article 36 hereof and has negotiated and agreed with the worker on rescission of labour contract; 3. the employment unit has rescinded the labour contract pursuant to the provisions of Article 40 hereof; 4. the employment unit has rescinded the labour contract pursuant to the provisions of the first paragraph of Article 41 hereof; 5. except where the employment unit proposes to renew a labour contract by maintaining or raising the conditions of the labour contract and the worker is not agreeable to the renewal, a fixed-term labour contract shall be terminated pursuant to the provisions of item (1) of Article 44 hereof; 6. the labour contract is terminated pursuant to the provisions of item (4) or item (5) of Article 44 hereof; or 7. any other circumstances stipulated by the laws and administrative regulations. Article 47: Economic damages shall be paid to a worker based on the number of years of service of the worker in the employment unit and based on the standard of one month?s wage for each completed year of service. Where the period of service is more than six months but less than a year, it shall be calculated as a completed year of service; where the period of service is less than six months, the employment unit shall pay half a month?s wage to the worker as economic damages. Where the monthly wage of a worker is more than three times the local average monthly wage of employees of the preceding year announced by the Municipal People?s Government of the centrally-administered municipality or the municipality divided into districts where the employment unit is located, the standard for economic damages to be made to the worker shall be based on three times the average monthly wage of employees and the maximum years of service for which economic damages is paid for shall not exceed 12 years. The monthly wage referred to in this Article shall mean the average wage of a worker over 12 months before the rescission or termination of the labour contract. Article 48: Where the employment unit rescinds or terminates a labour contract in violation of this Law and the worker requests for performance of the labour contract to be continued, the employment unit shall continue to perform the labour contract; where the worker does not request for performance of labour contract to be continued or where the performance of labour contract cannot be continued, the employment unit shall pay compensation pursuant to the provisions of Article 87 of this Law. Article 49: The State shall take measures to establish a proper cross-locality transfer and continuation system for workers? social insurance. Article 50: The employment unit shall show proof of rescission or termination of a labour contract at the time of rescission or termination of the labour contract and shall complete the filing and social insurance transfer formalities for the worker within 15 days. The worker shall complete job handover pursuant to the agreement between both parties. Where the employment unit is required to pay economic damages to the worker pursuant to the relevant provisions of this Law, the payment shall be made at the completion of job handover. The employment unit shall keep copies of rescinded or terminated labour contracts for at least two years for inspection purpose. CHAPTER FIVE: SPECIAL PROVISIONS Section One: Collective Contract Article 51: Enterprise employees and their employment unit may conclude a collective contract on matters such as labour remuneration, working hours, rest periods and off days, work safety and health and insurance and welfare etc through negotiation. A draft collective contract shall be submitted to the employee representatives congress or all staff for discussion and adoption. A collective contract shall be concluded between the labour union representing the enterprise employees and their employment unit; for the employment unit which has not established a labour union, the higher-level labour union shall guide the representatives elected by the workers to conclude a collective contract with the employment unit. Article 52: Enterprise employees and their employment unit may conclude a special collective contract on work safety and health, protection of the rights and interests of female workers and wage adjustment mechanism etc. Article 53: In industries such as building industry, mining industry and food and beverage industry etc in regions below county level, the labour union and the enterprise representatives shall conclude an industry collective contract or a regional collective contract. Article 54: Upon conclusion of a collective contract, a copy shall be submitted to the labour administrative authorities; where the labour administrative authorities do not raise any objection within 15 days from receipt of the copy of collective contract, the collective contract shall forthwith come into effect. A collective contract concluded pursuant to the law shall be binding upon the employment unit and the workers. Industry or regional collective contracts shall be binding upon employment units and workers of the locality in the industry or region. Article 55: The standards for labour remuneration and working conditions etc in a collective contract shall not be lower than the minimum standard stipulated by the local People?s Government; the standards for labour remuneration and working conditions etc in a labour contract concluded between the employment unit and a worker shall not be lower than the standard stipulated in the collective contract. Article 56: Where the employment unit violates the collective contract or infringes upon the workers? labour rights and interests, the labour union may, pursuant to the law, require the employment unit to bear liability; where a dispute arising from performance of a collective contract cannot be resolved through negotiation, the labour union may apply for arbitration or file a lawsuit pursuant to the law. Section Two: Secondment of Labour Article 57: Labour secondment units shall be established pursuant to the relevant provisions of the Company Law and shall have a registered capital of not less than Rmb 500,000. Article 58: Labour secondment units are employment units referred to in this Law and shall perform obligations of the employment unit towards the workers. A labour contract concluded between a labour secondment unit and a seconded worker shall, in addition to the contents stipulated in Article 17 of this Law, state the name of the work unit, the secondment period and job position etc of the worker. Labour secondment units shall enter into fixed-term labour contracts of two years and above with seconded workers and pay them labour remuneration on a monthly basis; during the period in which a seconded worker is not assigned any work duties, the labour secondment unit shall pay the worker remuneration on a monthly basis pursuant to the minimum wage standard stipulated by the local People?s Government. Article 59: A labour secondment unit shall enter into a labour secondment agreement with the unit that accepts employment by using labour secondment (hereinafter referred to as the ?work unit?). A labour secondment agreement shall stipulate the secondment positions and the number of seconded workers, secondment period, amount and payment method of labour remuneration and social insurance premiums and default liability. The work unit shall determine the secondment period with the labour secondment unit according to the actual needs of the job positions and shall not enter into several short-term labour secondment agreements by subdividing the secondment period. Article 60: Labour secondment units shall notify seconded workers of the contents of the labour secondment agreements. A labour secondment unit shall not deduct any amount from the labour remuneration paid by the work unit to a seconded worker pursuant to the labour secondment agreement. Labour secondment units and work units shall not collect monies from seconded workers. Article 61: Where a labour secondment unit undertakes a cross-locality secondment of workers, the seconded workers? entitlement to labour remuneration and working conditions shall comply with the standards at the location of the work unit. Article 62: The work unit shall perform the following obligations: 1. implement labour standards of the State and provide the corresponding working conditions and labour protection; 2. notify a seconded worker of his/her work requirements and labour remuneration; 3. pay overtime wage and performance bonus and provide welfare incentives in relation to the job positions; 4. provide the requisite job training for a seconded worker on the job; and 5. implement a normal wage adjustment mechanism for consecutive employment. The work unit shall not arrange seconded workers to work for another employment unit on a sub-secondment basis. Article 63: Seconded workers shall be entitled to the same remuneration for same type of job duties as workers of the work unit. Where the work unit does not have workers for the same job positions, the labour remuneration shall be determined with reference to same or similar job positions at the locality of the work unit. Article 64: Seconded workers shall have the right to participate in or organize a labour union of the labour secondment unit or the work unit pursuant to the law to safeguard their legitimate rights and interests. Article 65: A seconded worker may rescind a labour contract with a labour secondment unit pursuant to the provisions of Article 36 and Article 38 hereof. Where a seconded worker falls under any of the categories stipulated in Article 39 or item (1) or item (2) of Article 40 hereof, the work unit may send the worker back to the labour secondment unit and the labour secondment unit may, pursuant to the relevant provisions of this Law, rescind the labour contract with the worker. Article 66: Labour secondment is generally implemented in job positions which are temporary, auxiliary or substituting in nature. Article 67: The employment unit shall not set up a labour secondment unit to second workers to itself or its affiliated units. Section Three: Non-Full-time Employment Article 68: Non-full-time employment refers to the employment that is paid on an hourly basis, a worker works for the employment unit for not more than four hours per day on average and working hours per week do not exceed 24 hours in aggregate. Article 69: Both parties to the non-full-time employment may conclude a verbal agreement. A worker who engages in non-full-time employment may conclude a labour contract with one or more employment unit(s), provided that subsequently concluded labour contract shall not affect the performance of previously concluded labour contract. Article 70: Both parties to the non-full-time employment shall not agree on a probationary period. Article 71: Either party of both parties to the non-full-time employment may, at any time, notify each other of termination of employment. Upon termination of employment, the employment unit is not required to pay economic damages to the worker. Article 72: The standard for hourly rate of non-full-time employment shall not be lower than the minimum hourly wage standard stipulated by the local People?s Government at the locality of the employment unit. The settlement and payment cycle for labour remuneration of non-full-time employment shall not exceed 15 days. CHAPTER SIX: SUPERVISION AND INSPECTION Article 73: The labour administrative department of the State Council shall be responsible for supervision and administration of the implementation of labour contract system nationwide. The labour administrative authorities of local People?s Governments of county level and above shall be responsible for supervision and administration of the implementation of labour contract system within their respective administrative regions. The labour administrative authorities of local People?s Governments of county level and above shall, in the process of supervision and administration of the implementation of the labour contract system, seek the opinions of labour unions, enterprise representatives and the relevant industry administration authorities. Article 74: The labour administrative authorities of local People?s Governments of county level and above shall carry out supervision and administration of the following implementation status of the labour contract system: 1. the formulation of rules which directly involve the vital interests of workers by the employment units and the implementation thereof; 2. the conclusion and rescission of labour contracts between the employment units and workers; 3. compliance with the relevant provisions on labour secondment by labour secondment units and work units; 4. compliance with the provisions of the State on working hours, rest period and off days of workers by the employment units; 5. payment by the employment units of labour remuneration stipulated in labour contracts and execution of minimum wage standard; 6. participation by the employment units in various social insurance schemes and payment of social security premiums; and 7. any other labour surveillance matters stipulated by the laws and regulations. Article 75: The labour administrative authorities of local People?s Governments of county level and above shall, when implementing supervision and inspection, have the right to inspect materials related to labour contracts and collective contracts, conduct onsite inspection at work premises; the employment units and workers shall provide the relevant information and materials truthfully. Personnel of labour administrative authorities shall show their identity pass when carrying out supervision and inspection and shall exercise their duties and carry out civilised enforcement pursuant to the law. Article 76: The relevant departments of People?s Governments of county level and above responsible for supervision and administration of construction, health and work safety etc shall, pursuant to their respective scope of duties, carry out supervision and administration of implementation of the labour contract system by the employment units. Article 77: A worker whose legitimate rights and interests are infringed shall have the right to request the relevant authorities to handle the case pursuant to the law or the right to apply for arbitration or file a lawsuit pursuant to the law. Article 78: Labour unions shall safeguard the legitimate rights and interests of workers pursuant to the law and supervise the performance of labour contracts and collective contracts by the employment units. Where the employment unit violates the labour laws and regulations or a labour contract or collective contract, the labour union shall have the right to give opinion or require rectification; where a worker applies for arbitration or files a lawsuit, the labour union shall provide support and assistance pursuant to the law. Article 79: Any organization or individual shall have the right to report any violation of this Law; the labour administrative authorities of People?s Governments of county level and above shall promptly verify and deal with the matter and provide incentives for valid informers. CHAPTER SEVEN: LEGAL LIABILITY Article 80: Where the rules formulated by the employment unit which directly involve the vital interests of workers violate the provisions of laws and regulations, the labour administrative authorities shall order the employment unit to make correction and give a warning; where a worker suffers damages thereto, the employment unit shall bear compensation liability. Article 81: Where the copy of a labour contract provided by the employment unit does not contain the essential clauses of a labour contract stipulated in this Law or where the employment unit fails to provide a worker with a copy of the labour contract, the labour administrative authorities shall order the employment unit to make correction; where the worker suffers damages thereto, the employment unit shall bear compensation liability. Article 82: Where the employment unit fails to conclude a written labour contract with a worker within the period of more than one month but less than one year from the date of employment, the employment unit shall pay the worker wages at two times per month. Where the employment unit violates the provisions of this Law in failing to conclude a non-fixed-term labour contract with a worker, the employment unit shall pay the worker wages at two times per month with effect from the date of conclusion of non-fixed-term labour contract. Article 83: Where the employment unit violates the provisions of this Law in agreement with a worker on probationary period, the labour administrative authorities shall order the employment unit to make correction; where the probationary period agreed in violation of the law has been performed, the employment unit shall pay compensation to the worker based on the monthly wage of the worker upon expiry of the probationary period for the excess probationary period performed. Article 84: Where the employment unit violates the provisions of this Law in retaining the identity card etc of a worker, the labour administrative authorities shall order the employment unit to return the identity card etc to the worker within a stipulated period and shall mete out punishment pursuant to the relevant provisions of the law. Where the employment unit violates the provisions of this Law in collection of monies from a worker in the name of guarantee or any other pretext, the labour administrative authorities shall order the employment unit to return the monies to the worker within a stipulated period, and the employment unit shall be subject to a fine ranging from Rmb 500 to Rmb 2, 000 per person; where a worker suffers damages thereto, the employment unit shall bear compensation liability. Where the employment unit retains the files or any other articles of a worker following rescission or termination of a labour contract by the worker pursuant to the law, the employment unit shall be punished pursuant to the provisions of the preceding paragraph. Article 85: Under any of the following circumstances, the labour administrative authorities shall order the employment unit to pay labour remuneration, overtime wage or economic damages within a stipulated period; where the labour remuneration is lower than the minimum wage standard at the locality, the shortfall shall be paid; where payment is not made within the stipulated period, the employment unit shall be ordered to pay compensation to the worker based on the standard of 50% to 100% of the amount payable: 1. the employment unit fails to pay labour remuneration to a worker in full amount promptly pursuant to the provisions of the labour contract or the provisions of the State; 2. the employment unit pays a worker wages below the minimum wage standard at the locality; 3. the employment unit does not pay overtime wages for overtime work arranged; or 4. the employment unit rescinds or terminates a labour contract but fails to pay economic damages to the worker pursuant to the provisions of this Law. Article 86: Where a labour contract is deemed void pursuant to the provisions of Article 26 hereof and a party suffers damage thereto, the party at fault shall bear compensation liability. Article 87: The employment unit which violates the provisions of this Law in rescission or termination of a labour contract shall pay compensation to the worker at two times the economic damages stipulated in Article 47 hereof. Article 88: Under any of the following circumstances, the employment unit shall be subject to administrative punishment pursuant to the law; where the case constitutes a criminal offence, criminal liability shall be pursued in accordance with the law; where a worker suffers damages, the employment unit shall bear compensation liability: 1. the employment unit uses means such as violence, threat or illegal restriction of personal freedom to coerce a worker into provision of labour; 2. the employment unit gives orders which violate the rules or force a worker to engage in risky work which endangers the worker?s personal safety; 3. the worker is subject to humiliation, physical punishment, beating, illegal searches or detention by the employment unit; or 4. bad working conditions and severe environmental pollution which causes the worker to suffer serious damages to physical and mental health. Article 89: Where the employment unit violates the provisions of this Law in failing to show written proof of rescission or termination of labour contract to the worker, the labour administrative authorities shall order the employment unit to make correction; where the worker suffers damages thereto, the employment unit shall bear compensation liability. Article 90: Where a worker violates the provisions of this Law in rescission of labour contract or violates the provisions of a labour contract on confidentiality obligation or non-competition restrictive covenant and causes the employment unit to suffer damages, the worker shall bear compensation liability. Article 91: Where an employment unit employs a worker who has not rescinded or terminated his/her labour contract with the existing employment unit and causes the existing employment unit to suffer damages, an employment unit shall bear compensation liability jointly and severally. Article 92: A labour secondment unit which violates the provisions of this Law shall be ordered by the labour administrative authorities and the relevant authorities to make correction; where the case is serious, a fine ranging from Rmb 1,000 to Rmb 5,000 per person shall be imposed and the business licence shall be revoked by the administration for industry and commerce; where a seconded worker suffers damages thereto, the labour secondment unit and the work unit shall bear compensation liability jointly and severally. Article 93: For illegal acts and crimes committed by employment units which do not possess legitimate business qualifications, legal liability shall be pursued in accordance with the law; where a worker has provided labour services, the unit or its capital contributory(ies) shall pay labour remuneration, economic damages and compensation to the worker pursuant to the relevant provisions of this Law; and shall bear compensation liability if a worker suffers damages thereto. Article 94: Where an individual contractor violates the provisions of this Law in recruiting workers and the workers suffer damages thereto, the organization which awards the contract and the individual contractor shall bear compensation liability jointly and severally. Article 95: Labour administrative authorities and the relevant authorities and their personnel that are guilty of dereliction of duties, non-performance of statutory duties or exercise of official powers in violation of law which cause a worker or an employment unit to suffer damages shall bear compensation liability; person(s)-in-charge and other directly accountable personnel shall be subject to administrative punishment; where the case constitutes criminal offence, criminal liability shall be pursued in accordance with the law. CHAPTER EIGHT: SUPPLEMENTARY PROVISIONS Article 96: Where the laws and administrative regulations or the State Council provide otherwise for the conclusion, performance, variation, rescission or termination of labour contracts between business units with their staff under the existing employment scheme, such provisions shall prevail; where there are no provisions, the relevant provisions of this Law shall prevail. Article 97: Existing labour contracts concluded pursuant to the law prior to the implementation of this Law and valid as of the date of implementation of this Law shall continue to be performed; the number of instances of consecutive conclusion of fixed-term labor contracts stipulated in item (3) of the second paragraph of Article 14 hereof shall be computed with effect from the renewal of fixed-term labour contracts following the implementation of this Law. Where a written labour contract has not been concluded for a labour relationship established before the implementation of this Law, a written labour contract shall be concluded within one month from the date of implementation of this Law. Where a labour contract valid as of the date of implementation of this Law is rescinded or terminated following the implementation of this Law and whereby economic damages shall be paid pursuant to the provisions of Article 46 hereof, the duration for economic damages shall commence from the date of implementation of this Law; where the employment unit is required to pay economic damages to a worker pursuant to the relevant provisions prevailing before the implementation of this Law, such relevant prevailing provisions shall be complied with. Article 98: This Law shall be effective on 1 January 2008. Compliments of: The China Trade Commission www.ChinaTradeCommission.org Labor Dispute? Save thousands in legal fees.Arbitration is 50% less expensive and 80% faster than litigation! Investigate before retaining legal counsel. For a primer on arbitration law in China send an email to arbitration@ChinaTradeCommission.org ???????????? Compliments of The China Trade Commission www.ChinaTradeComission.org ???????????????????????????????? 2007 ? 6? 29????? 2008? 1? 1?????? ??? ? ? ??? ??????????????????????????????? ????????????????????????????? ??? ???????????????????????????????? ??????????????????????????????????? ???????? ??????????????????????????????????? ???????????????????? ??? ??????????????????????????????? ???? ??????????????????????????????????? ?? ??? ?????????????????????????????? ????????? ??????????????????????????????????? ??????????????????????????????????? ??????????????????????????????????? ?????????????????????? ??????????????????????????????????? ????????????????? ??????????????????????????????????? ?????? ??? ??????????????????????????????? ???????????????????????????? ??? ??????????????????????????????? ???????????????????????? ??? ??????? ??? ??????????????????????????????? ?????? ??? ??????????????????????????????? ???????????????????????????????????? ?????????????????????????????????? ?? ??? 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Compliments of: The China Trade Commission www.ChinaTradeCommission.org Labor Dispute? Save thousands in legal fees. Arbitration is 50% less expensive and 80% faster than litigation! Investigate before retaining legal counsel. For a primer on arbitration law in China send an email to arbitration@ChinaTradeCommission.org
Posted: 03 November 2011, last updated 9 November 2011

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