Guangdong issues guidance on employment disputes

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The Guangdong provincial government on 16 March 2017 issued the Guangdong Provincial Measures on Handling Employment Disputes. The measures streamline Guangdong’s employment dispute resolution system by aligning it with current practices in national law and rules on dispute prevention, mediation and arbitration. The measures took effect on 1 May 2017.

Specifically, the measures:

  • Require employers to establish internal negotiation mechanisms with employees and to respond timely to employee complaints and claims;
  • Require mediation organizations to close labour dispute mediation within 15 days after receiving the mediation application;
  • Allow the labour arbitration commission to adopt simplified procedures by shortening the evidence submission and defence periods and by issuing decisions based solely on documentary evidence without holding a hearing;
  • Require employers facing a major change in circumstances that renders performance of employment contracts impossible to develop a working plan, which can include employee adjustment plans, employment contract amendment, termination or renewal plans, etc.;
  • Allow the labour arbitration commission to request the local trade union, industry association or competent administrative department to participate in arbitration and assist in
    mediation during group labour disputes involving more than 50 employees; and
  • Require arbitration parties in an employment dispute to corroborate the source of audio, video and electronic evidence (audio and video evidence must be accompanied by a transcript of the recording).

On 27 March 2017, the Guangzhou Intermediate People’s Court published eight judicial guides for trial judges. One of these judicial guides addresses employment disputes and includes the following topics: dispute resolution procedures; identification of employment relationships; employment remuneration; social insurance benefits; and termination and severance.

Specifically, the judicial guide reiterates that: (1) a company policy can be recognized as valid even without first going through the employee consultation procedure if the policy complies with all laws and regulations, contains no obviously unreasonable provisions, and has been publicized or notified to employees with no employee objections raised; and (2) a company must establish a service relationship with any employee who reaches the statutory retirement age, even if the employee is not entitled to a pension.

Business Law Digest is compiled with the assistance of Baker McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker McKenzie by e-mailing Danian Zhang (Shanghai) at: danian.zhang@bakermckenzie.com