Latest Changes in China Labor Law for Coronavirus Outbreak

The death toll in China from the new coronavirus rose to 213 and another 102,000 people were also reportedly under medical observation with possible symptoms of the respiratory ailment. The World Health Organization (WHO) declared the outbreak a global emergency. The virus has spread to at least 18 other countries.

Mainland Chinese authorities are trying to keep citizens at home by extending the Chinese New Year holiday through February 3, 2020, with some areas (Shanghai, Suzhou, Guangdong Province and Zhejiang Province) extending the holiday through February 9, 2020. It is quite obviously going to hamper the business, manufacturing and production.

In order to protect the benefits of employees, the Chinese authorities have made significant changes in the employment law. Foreign employers must pay attention to these newly drafted employment law issued by the Beijing labor authorities. All the measures have been taken in order to stabilize the labor relations during the period of epidemic prevention and control. In response to the outbreak, Chinese Ministry of Human Resources and Social Security issued a notice in connection with its efforts to prevent and control coronavirus and labor relations on January 24, 2020 .

Many foreign employers in China are still not properly versed with the latest changes in the employment stated on the notice. The basic queries are, should the extended days be treated as statutory public holidays or rest days, or should annual leave be deducted, or should deferred working days be arranged at weekends? Can enterprises arrange employees to work at home before resuming work? Should overtime payments should be made if enterprises ask employees to work during the extended days?

In order to clear the doubts, we are trying to explain new changes

Employers must ensure their employees can enjoy their paid statutory medical leave. If an employee needs to take time off work due to an illness and the employee is eligible for statutory medical leave under the law, the employer must provide the leave in accordance with the national and local law, and the employee’s employment contract. Also, it prohibits the employer from unilaterally terminating an employee who has been diagnosed with the coronavirus, is merely suspected of being infected with the virus, has come in close contact with a coronavirus patient or suspected patient, or is unable to work due to the government quarantine or other government-imposed emergency measures in accordance with Article 40 (unilateral termination of an employee not caused by employee wrongdoing) of PRC Employment Contract Law or from conducting mass layoffs in accordance with Article 41 of PRC Employment Contract Law.

If a Beijing employee is unable to return to work due to the outbreak, the employer may consider first having the employee use his/her accrued vacation days. If an employee is unable to return to work for an “extended period of time” (whatever that means), the employer may consult with the employee and if the employee agrees, place the employee on standby. During this standby period, the employee shall be provided basic living expenses at a rate of no less than 70% of Beijing’s minimum wage.

Employees suffering from coronavirus should be granted a treatment period. Enterprises should pay for sick leave according to the labor contract or collective contract. The sick leave payment should not be lower than 80 percent of the minimum salary standard of Beijing Municipality. For any employees failing to return to Beijing and therefore unable to resume work on time due to the epidemic situation, the employer can treat the absence as annual leave.

An employer affected by the current situation may apply to the labor authorities for implementation of the comprehensive working hours system for eligible employees in order to maintain normal production and operation. Once approved, this alternative working hours system will allow the employer flexibility to arrange employees’ shifts and rest times so as to minimize overtime pay/liabilities.

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