How the law governs the employment relationship in the world’s most populous country
The current employment law in China is mainly regulated by the PRC Employment Law (PEL), which took effect in 1995. Local governments make regulations based on their area’s local policies. However, all regulations are guided by the PEL and are void if they conflict with it.
The PEL has 13 chapters, which cover almost all aspects of employment relationships such as working hours, holidays, salary, health and safety, training, social insurance and welfare, disputes and discrimination on grounds of race, sex, disability and age.
Here’s a look at some of the main provisions.
Employment contracts: Employers and employees are required to enter into a written employment contract, but an oral employment contract is also enforceable when an employment relationship has actually been formed by conduct.
Employment contracts can apply to a fixed period, an open period or just to a specific project. However, if an employee has worked for the same employer for more than 10 years and both parties want to continue the relationship, the employee has the right to determine whether the contract should be for a fixed term or not.
Normally, an employment contract has a trial period of no more than six months. During that period, the employer may terminate the contract if the employee is found unsuitable.
Termination: An employer can terminate on 30 days’ notice if:
•the employee is ill or has a non-work-related injury and can’t carry out the work that he has been contracted to perform. However, there is no right to terminate the contract while treatment for the illness is in progress;
•the employee is not suitable for the work he is doing and having been given training or alternative work, he is still not suited for that work;
•the contract becomes unenforceable because a “major situation” on which the employment contract relies has changed. Although the PEL does not define the term “major situation,” the courts have held that the term may include changes in law or policy.
Employees must normally give their employer 30 days’ notice to terminate the contract. However, they could leave anytime without 30 days’ notice, if:
•they are in the trial period;
•the employer forces them to work by violence, threats, or by unlawfully restricting their freedom; or
•the employer does not pay or provide work conditions according to the contract.
Working hours and holidays: All employees work eight hours per day and generally no more than 44 hours per week. Employers have to give employees at least one day off per week. Overtime must be negotiated with the relevant union, but normally not more than one hour per day is allowed. If there is a specific situation that requires overtime, the employer must ensure the employee is fit to do the work. The overriding limit on overtime is no more than three hours per day to a maximum of 36 hours per month.
Overtime rates are time-and-a-half for normal workdays, double-time for weekends and triple time for public holidays.
Employees are entitled to paid leave. The duration of such leave will depend on the type of work, the length of service and local regulations. For example, in Guangdong province, employees with one to five years’ service are entitled to a minimum of five days’ holiday and a maximum of 14 days for more than 20 years’ service.
Special protection for women and employees 16 to 18 years old: Employers are not permitted to hire those under 16 years old. Women and youths aged 16 to 18 years cannot undertake dangerous or physically demanding work. PEL provides a right to 90 days maternity leave for mothers after giving birth.
Jenny Yan is a paralegal with Pinsent Masons in the United Kingdom. She can be reached at [email protected].
The PEL has 13 chapters, which cover almost all aspects of employment relationships such as working hours, holidays, salary, health and safety, training, social insurance and welfare, disputes and discrimination on grounds of race, sex, disability and age.
Here’s a look at some of the main provisions.
Employment contracts: Employers and employees are required to enter into a written employment contract, but an oral employment contract is also enforceable when an employment relationship has actually been formed by conduct.
Employment contracts can apply to a fixed period, an open period or just to a specific project. However, if an employee has worked for the same employer for more than 10 years and both parties want to continue the relationship, the employee has the right to determine whether the contract should be for a fixed term or not.
Normally, an employment contract has a trial period of no more than six months. During that period, the employer may terminate the contract if the employee is found unsuitable.
Termination: An employer can terminate on 30 days’ notice if:
•the employee is ill or has a non-work-related injury and can’t carry out the work that he has been contracted to perform. However, there is no right to terminate the contract while treatment for the illness is in progress;
•the employee is not suitable for the work he is doing and having been given training or alternative work, he is still not suited for that work;
•the contract becomes unenforceable because a “major situation” on which the employment contract relies has changed. Although the PEL does not define the term “major situation,” the courts have held that the term may include changes in law or policy.
Employees must normally give their employer 30 days’ notice to terminate the contract. However, they could leave anytime without 30 days’ notice, if:
•they are in the trial period;
•the employer forces them to work by violence, threats, or by unlawfully restricting their freedom; or
•the employer does not pay or provide work conditions according to the contract.
Working hours and holidays: All employees work eight hours per day and generally no more than 44 hours per week. Employers have to give employees at least one day off per week. Overtime must be negotiated with the relevant union, but normally not more than one hour per day is allowed. If there is a specific situation that requires overtime, the employer must ensure the employee is fit to do the work. The overriding limit on overtime is no more than three hours per day to a maximum of 36 hours per month.
Overtime rates are time-and-a-half for normal workdays, double-time for weekends and triple time for public holidays.
Employees are entitled to paid leave. The duration of such leave will depend on the type of work, the length of service and local regulations. For example, in Guangdong province, employees with one to five years’ service are entitled to a minimum of five days’ holiday and a maximum of 14 days for more than 20 years’ service.
Special protection for women and employees 16 to 18 years old: Employers are not permitted to hire those under 16 years old. Women and youths aged 16 to 18 years cannot undertake dangerous or physically demanding work. PEL provides a right to 90 days maternity leave for mothers after giving birth.
Jenny Yan is a paralegal with Pinsent Masons in the United Kingdom. She can be reached at [email protected].
