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Collective agreements Collective agreements are more common in enterprises in the manufacturing and retail industries. Currently, most collective agreements are negotiated at company level between the company's management and its employees. To enhance employees' bargaining power, the ACFTU and the Government have promoted the establishment of enterprise-level trade unions, because enterprise-level trade unions can represent employees in collective bargaining.
What are the main points to consider if an employer wants to unilaterally change the terms and conditions of employment? Generally, an employer cannot unilaterally change the terms and conditions of employment without the employee's written consent. However, an employer can unilaterally change an employee's job position if either: The employee is incompetent in performing their role. The employee is unable to perform their role after a statutory period of medical treatment has expired see Question Is there a national or regional minimum wage?
The local government of each region announces its local minimum wage, which is normally updated at least every two years and applies to all employees, regardless of their age, position and experience.
The minimum wage generally includes a monthly minimum wage and an hourly minimum wage. The monthly minimum wage applies to all full-time employees, while the hourly minimum wage applies to all part-time employees. Restrictions on working time Are there restrictions on working hours? Can an employee opt out on either an individual or collective basis? Working hours Full-time employees. There are three types of working hours systems applicable to full-time employees: Standard working hours system.
Comprehensively calculated working hours system. Flexible working hours system. Under the standard working hours system, an employee should work no more than eight hours per day and 40 hours per week.HR Basics: Employee Relations
The employee is entitled to at least one rest day every week. If the employee is required to work over the above limits, they will be entitled to overtime pay to be calculated as follows: Under the comprehensively calculated working hours system, working hours are calculated within a certain calculation period for example, a month, a quarter or a year. The average daily working hours and the average weekly working hours must not exceed the statutory maximum no more than eight hours a day and no more than 40 hours a week.
The comprehensively calculated working hours system is generally applicable to certain special industries requiring long shifts for example, employees in transportation, airlines, fishery industry, offshore oil exploration and so on. The employees working under this working hours system usually work intensively for one period and then take continuous days of rest.
The employer must obtain approval from the competent authorities before adopting the comprehensively calculated working hours system. Under the flexible working hours system, an employee can perform their duties on a flexible schedule, provided that they properly complete the work assignment in a timely manner.
The flexible working hours system is only applicable to certain job positions for example, executives, sales personnel, taxi drivers and so on. Similarly, the employer must obtain approval from the competent authorities before adopting the flexible working hours system. An employee who works with an employer for no more than four hours per day on average and no more than 24 hours per week in total is considered to be a part-time employee.
Rest breaks There are no specific legal requirements concerning rest breaks during a working day, although it is common practice to give employees working under the standard working hours system a one-hour lunch break. Shift workers Shift workers are subject to the same regulation of working hours as full-time employees see above, Working hours. Additionally, in some cities for example, Shanghai and Tianjin the employer must pay an additional allowance for employees working on a night shift.
Is there a minimum paid holiday entitlement? Minimum paid holiday entitlement An employee who has worked continuously for more than 12 months is entitled to statutory paid annual leave. The amount of statutory paid annual leave is determined by the employee's cumulative working years which are calculated using the employee's length of time in work as a whole, not just for the employer with whom the employee is currently working and is as follows: One year or more but less than ten years' working time: Ten years or more but less than 20 years' working time: Public holidays There are 11 public holidays in total, as follows: A one-day holiday for New Year's Day 1 January.
A three-day holiday for the Spring Festival New Year's Day of the lunar year, and the second and third days of the first month of the lunar year. A one-day holiday for the Tomb-sweeping Festival the lunar Tomb-sweeping Day. A one-day holiday for Labour Day 1 May.
A seven-day holiday for National Day 1 to 7 October. The public holidays are not included in the statutory paid annual leave. Illness and injury of employees What rights do employees have to time off in the case of illness or injury?
Are they entitled to sick pay during this time off? Who pays the sick pay and, if the employer, can it recover any of the cost from the government? Entitlement to paid time off An employee who suffers a work-related injury or occupational disease is entitled to their normal salary and welfare benefits paid each month by the employer during their medical treatment period. The suspension-of-work-with-pay period should normally not exceed 12 months. If the employee suffers from a disability after receiving medical treatment, the normal salary and welfare benefits will stop being paid once an appraisal has been made of the employee's disability.
Different payments are made for varying degrees of disability. If the illness or injury is not work-related, the employee is entitled to sick pay during the medical treatment period under the employer's internal policy and the local regulations.
A statutory minimum standard applies to sick pay, which varies from region to region. An employee who needs medical treatment for an illness or non-work related injury can take a medical treatment period of leave, which ranges from three months to 24 months depending on the employee's total working years and their years of service with their current employer. During the medical treatment period, the employer cannot unilaterally dismiss the employee, unless the employee falls within one of the circumstances provided in Article 39 of the PRC Employment Contract Law for example, the employee has committed severe misconduct.
Recovery of sick pay from the state For work-related injuries or occupational diseases, the employer and the work-related injury insurance fund operated by the government assume their liabilities respectively under the Provisions on Work-related Injury Insurance.
The costs incurred by the employer in this respect cannot be recovered from the government. Sick pay cannot be recovered if it has been paid for a non-work related illness or injury. Statutory rights of parents and carers What are the statutory rights of employees who are: Parents including maternity, paternity, surrogacy, adoption and parental rights, where applicable? Carers including those of disabled children and adult dependants?
Maternity rights Female employees are entitled to maternity leave of 98 days which includes 15 days of antenatal leave. A reward of leave may be granted if a female employee is conforming to the family planning policy, and the standard of entitlement varies from region to region.
An extra 15 days' maternity leave can be granted where there are complications during labour. Female employees who have more than one baby in a single pregnancy will be granted an extra 15 days' maternity leave for each additional baby born.
For one year after the child is born, the female employee is given a one-hour break each day for breastfeeding. Female employees who bear more than one baby in a single birth are granted an extra one-hour break for each additional baby born.
During the pregnancy, maternity and breastfeeding period, the female employee's salary must not be changed by the employer. Additionally, the employer cannot unilaterally terminate her employment during these periods, unless one of the circumstances provided in Article 39 of the PRC Employment Contract Law applies for example, the employee's severe misconduct.
Paternity rights Some local regulations provide that the father of a newly born child can enjoy a certain number of paid days' leave.
There is no national provision covering paternity rights. Surrogacy There are no specific regulations concerning surrogacy in China's employment laws. Adoption rights There are no specific regulations concerning adoption rights in China's employment laws. Parental rights The parents of a child who dies are entitled to one to three days' paid bereavement leave.
Carers' rights There are no specific regulations concerning carers' rights in China's employment laws. Continuous periods of employment Does a period of continuous employment create any statutory rights for employees? If an employee is transferred to a new entity, does that employee retain their period of continuous employment? If so, on what type of transfer?
Statutory rights created A period of continuous employment has an impact on an employee's entitlement with regards to: The medical treatment period. The longer the period of continuous employment is, the more favourable these entitlements become.
Where an employee has been working with an employer for a consecutive period of ten years or more, they are entitled to an open-ended contract an open-ended contract cannot be terminated by the employer on the expiration of a certain contract term, unlike a fixed-term contract.
Where an employee has been working for the employer continuously for at least 15 years and is less than five years away from statutory retirement age, the employer cannot unilaterally dismiss the employee unless one of the circumstances provided in Article 39 of the PRC Employment Contract Law applies for example, the employee's severe misconduct see Question Consequences of a transfer of employee Where an employee is transferred to work for a new employer for reasons that are not attributable to the employee, their service period with the former employer also transfers and is counted as part of their years of service with the new employer.
However, if the previous employer made a severance payment to the employee at the time of transfer, the employee's service period with the previous employer will not be taken into account when calculating any severance payments to be made by the new employer.
There are no statutory requirements regarding the method of transfers. The employer can agree with the employee to either: Terminate the employment with the previous employer and sign a new employment contract with the new employer. Enter into a tripartite agreement to change the former employer to the new employer. Fixed term, part-time and agency workers To what extent are temporary and agency workers entitled to the same rights and benefits as permanent employees?
To what extent are part-time workers entitled to the same rights and benefits as full-time workers? Temporary workers Under the PRC Employment Contract law, the employer and employee can execute a fixed-term employment contract on mutual agreement. However, a permanent open-ended employment contract must be offered if either: The employee has been working for the employer for a consecutive period of more than ten years.
Before the renewal of the contract, a fixed-term employment contract had been executed on two consecutive occasions on and after 1 January with the same employer. Additionally, when the employer fails to conclude a written employment contract with the employee within one year from the employee's first working day, a permanent employment contract will be implied, beginning on the day following the completion of the one-year period.
Temporary workers are entitled to the same statutory benefits as permanent employees for example, social insurance and housing fundand are entitled to the same statutory severance pay in the case of termination.
Agency workers from labour dispatch agencies Agency workers are entitled to the same statutory benefits as permanent employees, and are entitled to the same statutory severance pay in the case of termination. They are also entitled to receive the same pay as permanent employees engaged in the same position. Part-time workers Part-time employees are paid by the hour and work not more than four hours per day for one employer.
They can work for one or more employers and execute more than one employment contracts simultaneously. A written employment contract is not legally required between an employer and a part-time employee. An employer cannot set out a probation period for part-time employees.
The employment is at-will and both parties can unilaterally terminate the employment at any time, with or without cause. The employer is not required to pay severance after the termination of employment to its part-time employees.
The hourly wages for part-time employees cannot be lower than the minimum hourly wage set by the local government see Question 9.
The payment cycle to part-time employees cannot exceed 15 days. Are there any requirements protecting employee privacy or personal data? In order to understand this difference it is important to have some appreciation of recent Chinese history and economic theory.
Since the inception of communism and the integration of socialism into the Chinese experience, many aspects of Chinese life are driven by the deeply held belief that there exists a basic equality among people.
This is true even though there is a current shift away from strict Chinese socialism toward a more market-oriented approach to economic reality. The powerful affect of the communist experience on the current cadre of Chinese workers and managers has resulted in a current reality that, where advantages of organizational position titles and the ability to reward or punish or knowledge and expertise due to some educational advantage exist, the individual who possesses these advantages becomes suspect and is frequently ostracized as not being one of the community.
The strong socialist base of belief of the vast majority of the Chinese population at all levels of society including those attracted to xiahie [to "go to the sea"] to work in joint ventures as both managers and workers brings with it a strong aversion to use a traditional western "power over" framework of authority. In its absence, Chinese managers prefer to use the power of relationship between "informal equals" to motivate worker productivity, regardless of the other power bases that are operating at the same time such as position, reward, or expertise.
This alternate framework represents a "power with" approach to authority. It is characterized by attention to establishing and maintaining effective personal relationships between manager and subordinate. Mutual respect is the core of the relationship and represents the essential ingredient that motivates a worker to carry out the directives of the manager.
In the best of all worlds in China, workers and manager mutually agree that production should increase or quality should improve and the worker implements any changes suggested by the manager based first on his or her respect for the manager and only secondly for considerations of the other power bases which accrue to the manager's position such as rewards or punishment.
Without the relationship of mutually inclusive respect, the effectiveness of the manager's alternate power sources become tenuous at best because he or she will lose the respect and support of the rest of the workers if they are applied in disrespectful ways. In response to a question related to the use of managerial power in his company, Po Chung, founder of DHL International summarized this position in clear and concise terms: In return, we give personal loyalty, commitment, care and respect.
Employment and employee benefits in China: overview
Motivation in China - the Continuing Theme of Relationship One of the core management dilemmas in both the Chinese and the Western workplace is how to motivate workers to do what the organization needs to have done in sufficient quantity and with sufficient quality to satisfy consumer needs. Much of the time managers spend on "human resource" issues in their organizations focuses on this topic, since a highly motivated workforce can make the difference between success or failure of the enterprise, both from the perspective of product output and from that of reputation as a "high quality" employer.
In the West, motivation is looked at from at least three different perspectives: Discussions with Chinese managers indicate that similar dilemmas exist in today's Chinese organizational environment.
Manager's interviewed, however, indicate that they believe there is a significant difference which exists between the West and China in that there appears to be wider flexibility and availability of benefits to motivate behavior in the West. Experience in Chinese-Western joint ventures, however, where broader benefit packages are available within a Chinese context show that, regardless of the expanded benefit packages, the same motivation issues continue to arise. It would appear that motivation is tied to more than benefits.
One branch of Western research began examining the relationship of employee motivation to the benefits provided by their organization. The findings of this research, undertaken initially by Victor Vroomfocused on the relationship of three core factors which appear to determine whether a person will be motivated at work.
If the worker feels that he or she has the skills, knowledge, appropriate support systems in the organization, and sufficient tools to do the job, they will feel the beginning of motivation to do the work.
If they feel that it is impossible for them to do the work due to lack of skill or knowledge on their part or as a result of other organizational factors, their motivation will be low. In some situations, workers have been promised rewards or special benefits if they work hard or achieve specific production targets. Where managers promise such rewards and do not follow through with them when production targets have been met, workers begin not to trust them.
In such situations, worker motivation to carry out the task remains low, because they lack trust in their manager in relation to promised rewards or special benefits. On the other hand, if managers do deliver the promised rewards, especially if it is clear that the manager had to fight to get those rewards for his employees, worker motivation and respect for the manager goes up.
If the organization promises rewards that are highly desirable to the workers and the other two conditions outlined above are positive then workers will be more motivated to carry out the work.
If, on the other hand, the organization provides rewards or benefits that are less attractive to its workers, individual workers may be less motivated to achieve those rewards - and their work performance will suffer. An example of this could be a Company which decided to reward an employee with extra time off from his or her job for special performance. If the employee was trying to make more money to buy a house, extra time off would not be seen as a useful reward. If the Company were to promise this employee extra salary for exceptional performance, the employee might be much more motivated work harder for this reward.
In early Western management practice, much attention was focused on rewards and benefits because this area was seen as the key motivating factor.
More modern management recognizes that all three factors are crucial to a fully motivated employee in a western organization. When this approach to modern motivation was discussed with Chinese managers, considerable focus was initially put on the rewards and benefits factor as key to motivating employees.
Further discussion, however, indicated that there was a fourth factor which might be considered more basic to motivating behavior: Managers indicated that, even if the employee believed that they could do what was being requested Factor 1the manager had done what he said he would do in the past, Factor 2 and the reward being offered was seen as valuable Factor 3the employee might still not exert extra effort.
The determining factor in a Chinese context was the quality of the relationship between the individual employee and his or her supervisor. In the words of one manager from Shanxie province: This is THE most important factor in motivating my choice. It enters the personal realm, a qualitatively different plane of relationship. According to the managers surveyed, this additional realm represents the true managerial base of motivation in a Chinese context.
The other factors as noted in the western model come in to play only after a positive level of relationship has been established. In some cases noted by respondents, even though promised rewards were clearly of interest to the workers and they had the ability to carry out the requested work, they still refused to perform as requested.
When queried as to their resistance, they indicated that they did not feel close to the manager who had requested the changes and had no "desire" to do the work. Based on this information, it would appear that the model of effective motivation within Chinese organizations would resemble that outlined in Figure 2.
First and most importantly, it is essential that Western managers understand that their ownership of the factory with associated power to make decisions related to wages and benefits does not give them effective authority or power in the eyes of many Chinese managers or workers. In fact, such "legitimate" forms of power make many Chinese employees suspicious of superiors, especially if the managers act as if they are somehow better than the workers.
In China, it is not effective in the long term to use the framework of "power over" or its various power mechanisms as the main base for motivating behavior in the workplace.
Secondly, the use of high salaries and benefits for employees as a way of motivating increased effort is not effective without a strong and respectful personal relationship between the workers and the managers concerned.
This is true for both Western and Chinese managers and between Western managers and their Chinese supervisors and subordinate managers. The key task of Western managers is to build and maintain effective personal relationships with their direct reports and to facilitate efforts of their direct reports to do the same with their employees. The key task for the Chinese manager is to explain issues to their Western counterparts in terms of the implications for relationship as well as the substance of the issue at hand.
In some cases this will require Western managers who in theory have more "power over" bases to make or defer decisions is ways that allow their subordinates to gain face, potentially to the short-term detriment to the image of the Western manager.
If this is done strategically, however, and by mutual agreement between the manager and his or her subordinates, both sides increase the degree of respect and trust that exist between them. The resultant positive impact on production often appears as an unmanaged byproduct of "the way we do business here.
In the West we have struggled hard over the last several decades to structure work in ways that focus less on the person and more on the accurate definition of job responsibilities, skill profiles and reward structures.
While these are important to some extent in China since they assist in clarifying the flow of work, they are essentially secondary to the personal relationship which the manager has with each of his workers.