REGULATIONS ON LABOR MANAGEMENT FOR FOREIGN
INVESTMENT ENTERPRISES IN JIANGSU PROVINCE

(Adopted at the 24th Session of the Standing Committee of
the 6th Jiangsu Provincial People's Congress on February 21,
1987 and promulgated by the Standing Committee of Jiangsu
Provincial People's Congress on March 7)

 

 

SUBJECT: ENTERPRISES WITH FOREIGN INVESTMENT

ISSUING-DEPT: JIANGSU PROVINCE

ISSUE-DATE: 03/07/1987

IMPLEMENT-DATE: 03/07/1987

LENGTH: 1777 words

TEXT:

[Article 1] The present Regulations are formulated in accordance with the "Law of the People's Republic of China on Joint Ventures Using Chinese and Foreign Investment", the "Law of People's Republic of China on Enterprises Operated Exclusively with Foreign Investment", and other relevant laws and regulations of the State, with respect to the specific environment of jiangsu province.

[Article 2] The labor management departments of the provincial, municipal and county people's governments shall be the institutions to administer the labor management provisions over those Sino-foreign equity and non-equity joint venture enterprises and wholly foreign-owned enterprises (hereinafter refer to as the foreign investment enterprise) in the province.

[Article 3] Staff and workers of the foreign investment enterprise shall have the rights to establish trade unions and organize activities in accordance with the relevant trade union laws of the State.  The foreign investment enterprise shall provide the necessary conditions for trade unions' activities.

[Article 4] The foreign investment enterprise may determine on its own its labor plans, organizational structure and personnel requirements.

[Article 5] The foreign investment enterprise may, with the assistance of the local labor and personnel management department, recruit and employ staff and workers on its own through an examination and selection process in which only the qualified are to be hired.

In the event that the required engineering and technical personnel or business management personnel are not available locally, the foreign investment enterprise concerned may recruit from other localities after consent from the labor and personnel management department of the locality concerned has been obtained through the good office of the labor and personnel management department of the municipality or province where the enterprise is located.

With respect to the staff and workers whom the foreign investment enterprise has decided to hire after examination, the original units where such personnel are in employment shall actively support and permit their transfer to their new employment.  In the event that dispute arises, the labor and personnel management department in their locality shall adjudicate.

[Article 6] In the event that an equity or a non-equity joint venture is established between a local enterprise and a foreign party, staff and workers of the original local enterprise who are not employed by the new joint venture enterprise shall be assigned other work by the Chinese party.  Other re-employment arrangements shall be made by the authorities in charge of the local enterprise or by the labor and personnel management department in the locality if the local enterprise has indeed difficulties in making such arrangements.

[Article 7] The foreign investment enterprise shall implement (the prevailing) labor contract system (when it is employing staff and workers).  The contracts shall be signed between the foreign investment enterprise and the employee individually or the trade union collectively.

A labor contract shall include the terms on the employment, dismissal and resignation of staff and workers, their production or job responsibility, wages, awards and punishments, working schedules and holidays, labor insurance and welfare, labor protection and labor discipline, duration of the contract, the condition for alterating or terminating the contract, the obligations for breach of contract, and other items of which both sides agree to be covered.

[Article 8] The foreign investment enterprise may, within the duration of the labor contract, dismiss staff or workers who have become redundant as a result of a significant change in production operation, or technology, or in accordance with the dismissal clauses stated in the labor contract.  A notice concerning the dismissal shall be given to the to-be-dismissed employee one month in advance.

The foreign investment enterprise shall compensate the above-mentioned staff or worker who is dismissed within the duration of the labor contract or whose employment is terminated upon the expiration of the labor contract.  Compensation shall be made with respect to the length of employment.  For each full year of employment, the employee shall receive a sum equivalent to the enterprise's average monthly wage per employee.  For more than 10 years of employment, the compensation starting from the 11th year shall be 1.5 times the monthly average.

When dismissed upon or before the expiration of the labor contract, the staff or worker concerned shall be treated as job-waiting labor by the local labor and personnel management department in accordance with the relevant regulations of the State.  Personnel recruited or employed from other places will be handled according to the terms in the contracts concerned.

Whithin the duration of the labor contract, the enterprise shall not dismiss staff and workers under the following conditions:

-- Employee who is under medical treatmet or convalescene because of job-related injury or occupational diseases;

-- Employee who is under medical treatment and staying in hospital because of non-job-related injury; and

-- Employee who is in her pregnancy, on maternity leave or nursing period.

The foreign investment enterprise shall, in accordance with the relevant labor protection rules and regulations for Stateowned enterprises, provide for those staff and workers who have been completely or partically incapacitated as a result of job-related injury.

[Article 9] Staff or worker who wishes to resign while his labor contract with the foreign investment enterprise is still in effect must tender his resignation one month in advance.  Resignation may be approved by enterprise if the reasons given are justified.

Staff and workers who have received training provided and financed by the foreign investment enterprise shall, in accordance with the labor contracts, compensate the enterprise concerned for the training expenses when they resign within the duration of the labor contracts.

[Article 10] The wage standards, method of distribution (payment), system of awards and allowance for staff and workers may be decided by the foreign investment enterprise.  The wage levels shall be fixed at levels not less than 120% of the average wage paid by the State-owned enterprises in the same line of business in the locality.  The foreign investment enterprise may given substantial, slight or not wage increase to its staff and workers depending on its economic performance.

Salaries of the general manager, deputy general manager, chief and deputy chief engineers, chief and deputy chief accountants and auditors and other senior managerial personnel, and matters relating to the employment, dismissal, resignation, remuneration, awards and welfare of foreign staff and workers and those from Hongkong, Macao and Taiwan shall be decided by the board of directors and be specified in the temployment contracts.

[Article 11] A foreign investment enterprise shall be exempted from the payment to the State of all subsidies on living costs and traffic expenses to the Chinese staff and workers but must pay or allocate the State-stipulated funds for the Chinese staff and workers' labor insurance, welfare costs and housing allowance.  Funds for their housing allowance may be kept by the enterprise to resolve their housing problems.

The standards of contributions to the funds for labor insurance, welfare costs and housing allowance of the foreign investment enterprise shall be fixed by the local people's government in accordance with the relevant regulations of the State.  Any increase of the above-mentioned funds shall be made correspondingly with the total wage-bill of the enterprise concerned.

[Article 12] The foreign investment enterprise shall have the right to formulate its own rules as regards rewards and punishments for its staff and workers.  Different punishments to the staff and workers for violations of the rules and disciplines of the enterprise may be made according to the seriousness of the case.  The maximum punishment may be dismissal.

[Article 13] Staff and workers of the foreign investment enterprise shall not work for more than eight hours per day.  Overtime work or production, if required, is allowed on the condition that it is not harmful to the health of staff and workers and they are paid for the overtime.

[Article 14] The foreign investment enterprise must follow the rules and regulations of the State concerning labor protection, safety in production and industrial hygiene.  The enterprise shall improve its working conditions and be subject to supervision by the labor management department in the locality.

[Article 15] In case of job-related accidents resulting in injuries, death, serious occupational poisoning or injuries and damages therefrom, the foreign investment enterprise concerned shall, in accordance with the relevant regulations of the State, report in time to the authorities in charge of the enterprise, the labor management department and the trade union.  It shall then be subject to the inspection by and be accountable to the said authorities.

[Article 16] Staff and workers of the foreign investment enterprise are entitled to the public holidays stipulated by the State, annual leave, home leave, and leaves for marriage, funerals and child-birth, During the above-mentioned leaves, the staff and workers concerned shall still receive full payment of their wages.

[Article 17] The labor plans, labor contracts, resignations and dismissals of staff and workers shall be reported by the foreign investment enterprise to the labor management department in the locality for the record.

[Article 18] Labor disputes occuring between the foreign investment enterprise and its employees shall be firstly resolved through consultations between the two parties, failing which one or both parties to the dispute may submit to arbitration by the labor management department in the locality.  If the arbitration decision is not acceptable to either party, the case may be taken to the local people's court within 15 days.

[Article 19] The present Regulations also apply to all enterprises in the province invested by companies, enterprises, economic entities and individuals from Hongkong, Macao and Taiwan.

[Article 20] The present Regulations shall come into force as from the date of their promulgation.