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Regulation on Labor Security Supervision - 2004

The Regulation on Labor Security Supervision, which was adopted at the 68th executive meeting of the State Council on October 26, 2004, is hereby promulgated, and shall come into force on December 1, 2004.

Regulation on Labor Security Supervision

Chapter I General Provisions

Article 1 This Regulation is formulated in accordance with the Labor Law and other relevant laws in order to implement the laws, regulations and rules on labor and social security (hereinafter referred to as labor security), regulate labor security supervision, and maintain the lawful rights and interests of laborers.

Article 2 The labor security supervision over enterprises and individual industrial and commercial households (hereinafter referred to as the employing entities) shall be governed by this Regulation.

The labor security supervision over job intermediary institutions, occupational skills training institutions, and occupational skills assessment and authentication institutions shall be conducted in accordance with this Regulation.

Article 3 The labor security administration of the State Council shall be in charge of the labor security supervision work of the whole country. The labor security administration of a local people’s government at the county level or at any level above shall be in charge of the labor security supervision work within its own administrative area.

The relevant departments of a people’s government at the county level or at any level above shall, according to their respective duties, support and assist in the labor security supervision work of the labor security administration.

Article 4 The labor security administration of a people’s government at the county level or at the level of a city divided into districts may entrust an organization meeting the law enforcement conditions for supervision to conduct the labor security supervision.

The labor security supervisors in a labor security administration or in an organization entrusted to conduct labor security supervision shall pass the corresponding assessment or examination before they are employed.

The labor security supervision certificates shall be produced under the supervision of the labor security administration of the State Council.

Article 5 The local people’s government at the county level or at any level above shall strengthen labor security supervision work. The expenses needed in labor security supervision shall be included into the public finance budget at the current level.

Article 6 The employing entities shall abide by labor security laws, regulations and rules, accept and cooperate in the labor security supervision.

Article 7 The labor unions at all levels shall maintain the lawful rights and interests of the laborers in accordance with the law, and supervise the employing entities’ obedience of labor security laws, regulations and rules.

A labor security administration shall pay attention to heeding the opinions and suggestions of labor union organizations in its labor security supervision work.

Article 8 Labor security supervision shall be in compliance with the principles of impartiality, publicity, high efficiency, and benefiting the people.

The labor security supervision shall adhere to the principle of combining education with penalty, and accept public supervision.

Article 9 Any organization or individual shall have the right to report to the labor security administration any act of violating labor security laws, regulations or rules.

Where a laborer considers that the employing entity infringes upon his lawful rights and interests of labor security, he shall have the right to make complaint to the labor security administration.

A labor security administration shall keep confidential for the reporters and complainants, and shall award those whose report is true and who have provided important clues or evidence for investigating major acts of violating labor security laws, regulations or rules.

Chapter II Labor Security Supervision Duties

Article 10 A labor security administration that conducts labor security supervision shall perform the following duties:
(1) Publicizing labor security laws, regulations and rules, and urging employing entities to implement them;
(2) Inspecting the employing entities’ obedience of labor security laws, regulations and rules;
(3) Accepting the reports and complaints on violation of labor security laws, regulations or rules; and
(4) Lawfully correcting and investigating and punishing the acts of violating labor security laws, regulations or rules.

Article 11 A labor security administration shall conduct labor security supervision over the following particulars:
(1) the employing entities’ formulation of internal labor security rules and systems;
(2) the employing entities’ conclusion of labor contracts with laborers;
(3) the employing entities’ obedience of provisions on prohibiting employment of child laborers;
(4) the employing entities’ obedience of provisions on special labor protection of female employees and underage laborers;
(5) the employing entities’ obedience of provisions on working hours, rests and holidays;
(6) the employing entities’ payment of wages to the laborers and implementation of the lowest rate of wages;
(7) the employing entities’ buying of various social insurances and payment of social insurance premiums;
(8) the obedience of relevant provisions of the state on job intermediation, occupational skills training, and occupational skills assessment and authentication by the job intermediary institutions, occupational skills training institutions, and occupational skills assessment and authentication institutions; and
(9) other particulars prescribed in laws and regulations on labor security supervision.

Article 12 The labor security supervisors’ lawful performance of their labor security supervision duties shall be protected by law.

A labor security supervisor shall be devoted to his duties, be level-handed in law enforcement, be honest and clean, exercise administrative functions diligently, and keep secrets.

Any organization or individual shall have the right to report the labor security supervisor’s acts of violating laws or disciplines or make charges against such acts to the labor security administration or the relevant organs.

Chapter III Implementation of Labor Security Supervision

Article 13 The labor security supervision over an employing entity shall be under the jurisdiction of the labor security administration at the county level or at the level of a city divided into districts at the locality of employment by the employing entity.

A superior labor security administration may, in light of the needs in its work, investigate and handle the cases under the jurisdiction of its inferior labor security administrations. If any dispute arises among labor security administrations concerning the jurisdiction over labor security supervision, they shall report to the labor security administration at their common next higher level for designation of jurisdiction.

The people’s government of a province, autonomous region, or municipality directly under the Central Government may formulate specific measures for the jurisdiction of labor security supervision.

Article 14 Labor security supervision shall be conducted in the forms of making daily inspection tours, of examining the written documents submitted by the employing entities as required, and of accepting reports and complaints, etc.

Where a labor security administration considers that an employing entity has the act of violating labor security laws, regulations or rules, which needs to be investigated for punishment, it shall file the case in time.

A labor security administration or an organization entrusted to conduct labor security supervision shall set up a mail box and a telephone for accepting reports and complaints.

A labor security administration shall, according to the pre-planned scheme for responding to emergency, promptly deal with the collective incidents arising from violation of labor security laws, regulations or rules jointly with the relevant departments.

Article 15 A labor security administration shall be authorized to take the following investigation and inspection measures when conducting labor security supervision:
(1) Entering the employing entity’s work site to make inspections;
(2) Inquiring of the relevant persons about the investigated or inspected particulars;
(3) Requiring the employing entity to provide documents relating to the investigated or inspected particulars, to making explanations and statements, and sending a letter of inquiry in investigation if necessary;
(4) Collecting the relevant information by means of keeping written records, audio recording, video recording, taking photos, or copying, etc.;
(5) Entrusting an accounting firm to audit the employing entity’s payment of wages and social insurance premiums; and
(6) Other investigation and inspection measures which may be taken by the labor security administrations as prescribed in laws and regulations.

A labor security administration shall be authorized to correct on site the acts of violating labor security laws, regulations or rules with clear facts and conclusive evidence, and which may be punished on site.

Article 16 For the sake of investigation or inspection, there shall be at least 2 labor security supervisors, who shall wear the labor security supervision marks, and shall produce their labor security supervision certificates.

Where a labor security supervisor is to handle a matter under labor security supervision, which has direct interest relationship with he himself or his close relative, he shall withdraw.

Article 17 A labor security administration shall, within 60 working days as of filing the case, complete its investigation on the act of violating labor security laws, regulations or rules. If the case is complicated, the period may be extended by 30 working days upon approval of the responsible person of the labor security administration.

Article 18 A labor security administration shall, on the basis of the result from investigation and inspection, impose the following punishments upon those violating labor security laws, regulations or rules:
(1) Lawfully making a decision on imposing an administrative penalty upon anyone who ought to be imposed upon the administrative penalty;
(2) Lawfully ordering anyone who ought to make a correction but fails to do so, or making a decision on administrative punishment accordingly; or
(3) Canceling the filed case if it is slight and the violator has made corrections.

Where a labor security administration finds that a case on any illegal act does not fall within the labor security supervision, it shall timely transfer the case to the relevant department for settlement. If the case is suspected of involving a crime, it shall be lawfully transferred to the judicial organ.

Article 19 A labor security administration shall, before making a decision on any administrative penalty or administrative disposal against the act of violating labor security laws, regulations or rules, listen to the statements and justification of the employing entity; and shall, when making a decision on any administrative penalty or administrative disposal, inform the employing entity of the rights to apply for administrative reconsideration or to bring an administrative lawsuit that it may enjoy in accordance with the law.

Article 20 Where an act of violating labor security laws, regulations or rules is neither found by the labor security administration nor reported or complained by others within 2 years, the labor security administration shall no longer investigate it.

The period prescribed in the preceding paragraph shall begin from the date when the act of violating labor security laws, regulations or rules occurred; or begin from the date when the act of violating labor security laws, regulations or rules is concluded if such act is in a continuing state.

Article 21 Where an employing entity violates labor security laws, regulations or rules, thus causes any damage to a laborer, the employing entity shall bear the liabilities for compensation in accordance with the law. If the laborer is in dispute with the employing entity on the compensation, the dispute shall be settled in accordance with the relevant provisions of the state on settlement of labor disputes.

With respect to a matter which ought to be resolved through the procedures for settlement of labor disputes, or a matter for which the party concerned has applied for reconciliation, arbitration or has brought a lawsuit pursuant to the procedures for settlement of labor disputes, the labor security administration shall inform the complainant to deal with it pursuant to the procedures for settlement of labor disputes or litigation procedures.

Article 22 A labor security administration shall set up archives on the employing entities’ obedience of law on labor security, their honesty and credibility. If any employing entity has a major act of violating labor security laws, regulations or rules, the relevant labor security administration shall announce this violation to the public.

Chapter IV Legal Liabilities


Article 23 Where an employing entity has any of the following acts, it shall be ordered by the labor security administration to make a correction, and be imposed upon a fine of not less than 1,000 Yuan but not more than 5,000 Yuan for each aggrieved laborer:
(1) Arranging female employees to undertake work under wells at mines, any labor with Grade IV physical labor intensity or any other prohibited labor as prescribed by the state;
(2) Arranging female employees to undertake work high above the ground, under low temperatures, or in cold water during their monthly periods, or work with Grade III physical labor intensity as prescribed by the state;
(3) Arranging female employees to undertake during their pregnancy the work with Grade III physical labor intensity as stipulated by the state or other work that the state prevents them from doing during pregnancy;
(4) Arranging female employees who have been pregnant for no less than seven months to work on night shifts or prolonging their working hours;
(5) Permitting birth-giving female employees to enjoy maternity leaves shorter than 90 days;
(6) Arranging female employees to undertake work with Grade III physical labor intensity as prescribed by the state during their breast-feeding of babies less than one year old, or other labor that the sate prevents them from doing during their breast-feeding periods, or prolonging their working hours or arranging them to work on night shifts;
(7) Arranging underage laborers to undertake work under wells at mines, poisonous or harmful work, work with Grade IV physical labor intensity as prescribed by the state, or any other labor that the state prevents them from doing; or
(8) Failing to hold physical examinations for underage laborers at regular intervals.

Article 24 Where an employing entity sets up labor relationships with laborers but does not conclude labor contracts in accordance with the law, it shall be ordered by the labor security administration to make a correction.

Article 25 Where an employing entity violates labor security laws, regulations or rules by prolonging the laborers’ working hours, it shall be warned by the labor security administration, and ordered to make a correction within a time limit, and in addition, may be imposed upon a fine of not less than 100 Yuan but not more than 500 Yuan for each aggrieved laborer.

Article 26 Where an employing entity has any of the following acts, it shall be ordered by the labor security administration to pay, within a time limit, the wages and remunerations to the laborers, and also the balance of the lowest rate of local wages and the wage of the laborers if their wages are lower than the lowest rate of local wages, or the economic compensation for rescinding the labor contracts. If the employing entity fails to pay the said amount within the time limit, it shall be ordered to pay additional compensation to the laborers at the rate of not less than 50% but not more than 1 time of the payable amount:
(1) Deducting wages and remunerations of the laborers, or delaying the payment thereof without reason;
(2) Paying to the laborers wages lower than the lowest rate of local wages; or
(3) Failing to pay the economic compensation to laborers in accordance with the law after rescinding the labor contracts.

Article 27 Where an employing entity conceals the total amount of wages or the number of employees when declaring the payable amount of social insurance premiums to the social insurance handling institution, it shall be ordered by the labor security administration to make a correction, and in addition, be imposed upon a fine of not less than 1 time but not more than 3 times of the concealed amount of wages.

Whichever employing entity obtains social insurance treatments or social insurance fund expenditures by fraud shall be ordered by the labor security administration to refund the amount, and in addition, be imposed upon a fine of not less than 1 time but not more than 3 times of the amount it obtains by fraud. If a crime is constituted, it shall be subject to criminal liabilities in accordance with the law.

Article 28 Where a job intermediary institution, an occupational skills training institution, or an occupational skills assessment and authentication institution violates the relevant provisions of the state on job intermediation, occupational skills training, or occupational skills assessment and authentication, it shall be ordered by the labor security administration to make a correction, be confiscated of its illegal proceeds, and in addition, be imposed upon a fine of not less than 10,000 Yuan but not more than 50,000 Yuan. If the case is serious, its license shall be revoked.

An organization or individual who engages in job intermediation, occupational skills training, or occupational skills assessment and authentication without permission from the labor security administration shall be investigated, punished and banned by the labor security administration and the administration for industry and commerce in accordance with the relevant provisions of the state on investigating, punishing and banning business operation without license.

Article 29 Where an employing entity violates the Labor Union Law of the People’s Republic of China by committing any of the following acts, it shall be ordered by the labor security administration to make a correction:
(1) Obstructing laborers from lawfully attending and organizing the labor union, or obstructing the superior labor union from helping or guiding laborers to prepare to form a labor union;
(2) Transferring without any justifiable reason the work post of an employee in the labor union who performs his duties in accordance with the law to retaliate upon him;
(3) Rescinding the labor contract with a laborer due to his attending labor union activities; or
(4) Rescinding the labor contract with an employee in the labor union due to his lawful performance of his duties.

Article 30 Where an employing entity commits any of the following acts, it shall be ordered by the labor security administration to make a correction; if it has any act prescribed in Item (1), (2) or (3), it shall be imposed upon a fine of not less than 2,000 Yuan but not more than 20,000 Yuan:
(1) Resisting or obstructing without reason the labor security administration from conducting labor security supervision in accordance with this Regulation;
(2) Failing to submit the written documents pursuant to the requirements of the labor security administration, concealing the truth of facts, or producing false evidence or concealing or destroying evidence;
(3) Refusing to make a correction after being ordered by the labor security administration to do so, or refusing to implement the decision of the labor security administration on any administrative punishment; or
(4) Retaliating upon the reporter or complainant.

Where any employing entity violates the provisions in the preceding paragraph, thus constituting an act in violation of public security administration, it shall be imposed upon a penalty of public security administration by the public security organ in accordance with the law. If a crime is constituted, it shall be subject to criminal liabilities in accordance with the law.

Article 31 Where a labor security supervisor abuses his powers, neglects his duties, practices frauds for personal gains or discloses any commercial secret he knows in the process of performing his duties, he shall be imposed upon administrative sanctions in accordance with the law. If a crime is constituted, he shall be subject to criminal liabilities in accordance with the law.

Where a labor security administration or a labor security supervisor illegally exercises powers, and infringes upon the lawful rights and interests of an employing entity or laborer, it/he shall bear the liabilities for compensation in accordance with the law.

Article 32 With respect to the issues under labor security supervision as prescribed in this Regulation, if there are otherwise provisions in laws or other administrative regulations on penalty, such provisions shall apply.

Chapter V Supplementary Provisions

Article 33 Where an employing entity has no business license or its business license has been revoked in accordance with the law, but it still recruits employees, the labor security administration shall conduct labor security supervision in accordance with this Regulation, notify the administration for industry and commerce in time to investigate, punish and ban such employing entity.

Article 34 The labor security administrations shall conduct labor security supervision according to their duties and in accordance with this Regulation over the implementation by state organs, public institutions and social organizations of labor security laws, regulations or rules.

Article 35 The supervision over and inspection on labor safety and sanitation shall be conducted by the department of health, the department for supervision and administration of safe production, the department for supervision and administration of the safety of special equipment, and other relevant departments in accordance with the relevant laws and administrative regulations.

Article 36 This Regulation shall come into force on December 1, 2004.

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