Employment issues and guidance for business restructuring in China

0
2411
LinkedIn
Facebook
Twitter
Whatsapp
Telegram
Copy link

With the continual development of new technology, rapid changes in the global economy, the constant threat of competition and a slowing local market, many companies are faced with the challenge of restructuring their business operations in China in order to cope with these new changes. Such restructurings may include: converting a Sino-foreign joint venture into a wholly foreign-owned enterprise; moving location to achieve expansion, be closer to clients, distributors and suppliers, or to take advantage of lower land leasing costs; or closing specific production lines with out-of-date technology.

Business restructuring projects almost inevitably result in labour force downsizing. The legal regime in China is very protective of employee rights and restrictive of an employer’s right to unilaterally terminate employment. Any project of this kind tends to be sensitive and is likely to meet significant resistance from employees concerned, in particular those who have been working with the employer for a long time and/or those for whom it may be difficult to find a new equivalent job after a termination.

It is increasingly common in China for tensions to escalate in these situations. In extreme situations, employees may: protest directly to government authorities; restrict or block access to company premises; engage in potentially damaging media campaigns; threaten or cause damage to company property; report alleged company non-compliance to regulatory authorities; or engage in other impulsive and potentially harmful actions.

You must be a subscribersubscribersubscribersubscriber to read this content, please subscribesubscribesubscribesubscribe today.

For group subscribers, please click here to access.
Interested in group subscription? Please contact us.

你需要登录去解锁本文内容。欢迎注册账号。如果想阅读月刊所有文章,欢迎成为我们的订阅会员成为我们的订阅会员

已有集团订阅,可点击此处继续浏览。
如对集团订阅感兴趣,请联络我们

Matthew Durham and May Lu are partners at Simmons & Simmons

LinkedIn
Facebook
Twitter
Whatsapp
Telegram
Copy link