Notable Changes in the China Employment Law Since COVID-19

After the outbreak of the Corona pandemic, new policies, laws, and regulations have been introduced by the Chinese government. The changes are aimed at properly handling the issues related to employment that emerged as the natural outcome of the COVID-19 outbreak. The Chinese government has realized that measures for economic reactivation should follow a job-rich approach, backed by stronger employment policies and institutions, better-resourced and comprehensive social protection systems.

 

Generally, under the People’s Republic of China (PRC) law, an employment contract can only be terminated based on certain limited grounds. Different legal requirements will apply to terminations based on those different grounds. The current COVID-19 pandemic situation does not remove or mitigate these. There has been no emergency relief from these requirements and we do not expect there to be any.

 

China Employment Laws

China employment law basically involves such issues as employment contracts, remuneration or salary, workplace safety, procedures for negotiations, labor disputes, working hours, protection from discrimination, compensation or wage regulations, training, social insurance, and other legal responsibilities the employer must follow according to law.

In order to materialize all these goals, Chinese authorities have brought in a few notable changes in the China labor and employment law. Dealing with employment relationships.  On February 7, 2020, the PRC Ministry of Human Resources and Social Security has issued the Opinions on Stabilizing Employment Relationship during the Period for Prevention and Control of the Novel Coronavirus-infected Pneumonia Epidemic to Support Enterprises in Resuming Work and Production (the “Opinions”). Local regulators have issued various similar notices in this regard in Shanghai and Guangdong province.

During the epidemic, many companies created a new form of recruitment to ease the pressure on labor costs. Enterprises with a labor shortage and those businesses with a temporary labor surplus due to suspended or reduced operations were able to share their workforce. To some degree, this has been a win-win solution as it improves the efficiency of human resources allocation.

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