(Adopted at the 31st Session of the Standing Committee of the 10th National People’s
Congress on December 29, 2007. Promulgated by the President with
Order No. 80 on December 29, 2007. Effective from May 1, 2008.)
Table of Contents
Chapter 1. General Provisions
Chapter 2. Mediation
Chapter 3. Arbitration
Section 1. General Provisions
Section 2. Application and Acceptance
Section 3. Hearing and Award
Chapter 4. Supplementary Provisions
CHAPTER 1. GENERAL PROVISIONS
Article 1. This Law is formulated in order to resolve employment disputes in a fair and timely manner, to safeguard the lawful rights and interests of the parties and to promote stable and harmonious employment relationships.
Article 2. This Law governs the following employment disputes between employers and workers in the People’s Republic of China:
(1) disputes arising from the confirmation of an employment relationship;
(2) disputes arising from the conclusion, performance, amendment, termination or ending of an employment contract;
(3) disputes arising from dismissal due to frequent absence without leave or other reasons, or from a formal or de facto resignation;
(4) disputes arising from working hours, rest and leave, social insurance, benefits, training or labor protection;
(5) disputes arising from labor compensation, medical bills for a work-related injury, severance pay or damages, etc.;
(6) other employment disputes specified in laws or statutes.
Article 3. The resolution of employment disputes shall be based on the facts and adhere to the principles of legality, fairness, timeliness and favoring mediation, and shall protect the lawful rights and interests of the parties.
Article 4. When an employment dispute arises, the worker may hold consultations with the employer, or ask the labor union or a third party to jointly hold consultations with the employer, and reach a settlement agreement.
Article 5. If an employment dispute arises and a party is unwilling to hold consultations, or the consultations are unsuccessful or the settlement agreement reached is not performed, an application may be made to a mediation organization for mediation. If a party is unwilling to undergo mediation, or mediation is unsuccessful or the mediated settlement agreement reached is not performed, an application may be made to a labor arbitration commission for arbitration. Unless otherwise provided for in this Law, a party that is dissatisfied with the arbitration award may institute an action with a People’s Court.
Article 6. When an employment dispute arises, the parties shall be responsible for providing evidence in support of their assertions. If evidence relating to the subject matter of the dispute is in the possession or under the control of the employer, the employer shall provide such evidence. If the employer fails to provide the same, such failure shall be held against it.
Article 7. If there are 10 or more workers in an employment dispute and they have a joint claim, they may elect a representative to take part in the mediation, arbitration and/or litigation activities.
Article 8. The labor administration authorities of People’s Governments at the county level and above shall, together with labor union and enterprise representatives, establish a tripartite employment relationship harmonization mechanism and jointly consider and resolve major issues concerning employment disputes.
Article 9. If an employer violates state regulations by being in arrears in the payment of labor remuneration or failing to pay the same in full, or by being in arrears in the payment of medical bills for a work-related injury, severance pay or damages, the worker may lodge a complaint with the labor administration authority, and the labor administration authority shall handle the matter in accordance with the law.
CHAPTER 2. MEDIATION
Article 10. When an employment dispute arises, the parties may apply to one of the following mediation organizations for mediation:
(1) the enterprise’s employment mediation committee;
(2) a grassroots people’s mediation organization established in accordance with the law; or
(3) a town, township or neighborhood organization that has an employment mediation function.
An enterprise’s employment mediation committee shall be comprised of representatives of the employees and of the enterprise. The employee representatives shall be members of the labor union or be elected by all of the employees, and the enterprise representatives shall be designated by the person in charge of the enterprise. A member of the labor union or a person jointly selected by the two parties shall serve as the chairman of the enterprise’s employment mediation committee.
Article 11. The mediators serving on employment mediation committees shall be adult citizens who are just, upright, in contact with the masses and eager to engage in mediation work and have substantial legal knowledge, knowledge of policies and ability to implement policies, and a significant educational level.
Article 12. When a party applies for mediation of an employment dispute, he or it may do so in writing or orally. If the application is made orally, the mediation organization shall record on the spot the applicant’s particulars, the subject matter of the dispute for which mediation is applied, the grounds and the date.
Article 13. When mediating an employment dispute, the mediators shall listen to all the statements on the facts and grounds made by the parties, patiently guide the parties toward a solution and assist them in reaching an agreement.
Article 14. If an agreement is reached through mediation, a written mediated settlement agreement shall be drawn up.
The written mediated settlement agreement shall be signed or sealed by the parties and shall enter into effect once it bears the signatures of the mediators and the seal of the mediation organization. The agreement shall be binding on the parties and the parties shall perform the same.
If no mediated settlement agreement is reached within 15 days from the date on which
the employment mediation organization receives the application for mediation, the parties may apply for arbitration in accordance with the law.
Article 15. If, after a mediated settlement agreement has been reached, either party fails to perform such agreement by the deadline set forth therein, the other party may apply for arbitration in accordance with the law.
Article 16. If a mediated settlement agreement is reached on the payment of overdue labor remuneration, medical bills for a work-related injury, severance pay or damages but the employer fails to perform such agreement by the deadline specified therein, the worker may apply to a People’s Court for a payment order on the strength of the agreement. The People’s Court shall issue a payment order according to law.
CHAPTER 3. ARBITRATION
Section 1. General Provisions
Article 17. Labor arbitration commissions shall be established based on the principles of master planning, reasonable distribution and satisfaction of actual need. The People’s
Government of a province or autonomous region may decide to establish such commissions in municipalities and counties, and the People’s Government of a municipality directly under the central government may decide to establish such commissions in districts and counties. A municipality directly under the central government or municipality divided into districts may also establish one or several labor arbitration commissions. Labor arbitration commissions are not established at each level in line with administrative divisions.
Article 18. The State Council’s labor administration authority shall formulate arbitration rules in accordance with this Law. The labor administration authorities of the People’s
Governments of the provinces, autonomous regions and municipalities directly under the central government shall guide the employment arbitration work within their respective jurisdictions.
Article 19. Labor arbitration commissions shall be composed of representatives from the labor administration authority, labor union and enterprises. A labor arbitration commission shall have an odd number of members.
A labor arbitration commission shall perform the following duties according to law:
(1) engaging and dismissing full-time or part-time arbitrators;
(2) accepting employment cases;
(3) discussing major or difficult employment cases; and
(4) monitoring arbitration activities.
A labor arbitration commission shall have a general office, which shall be responsible for handling the day-to-day work of the commission.
Article 20. A labor arbitration commission shall maintain a register of arbitrators.
An arbitrator shall be just and upright and satisfy one of the following conditions:
(1) he once served as a judge;
(2) he is engaged in legal research or education and has a mid-level or higher title;
(3) he possesses legal knowledge and has been professionally engaged in human resource management, labor union work or other such work for at least five years; or
(4) he has practiced as a lawyer for at least three years.
Article 21. A labor arbitration commission shall be responsible for the employment disputes in its jurisdiction.
An employment dispute shall come under the jurisdiction of the labor arbitration commission of the place where the employment contract is performed or that of the place where the employer is located. If one party applies to the labor arbitration commission of the place where the employment contract is performed and the other to that of the place where the employer is located, the labor arbitration commission of the place where the contract is performed shall have jurisdiction.
Article 22. The parties to an employment arbitration case shall be the worker and the employer between which the employment dispute arose.
If an employment dispute arises between a worker and the staffing firm that placed him or the unit that accepted his placement, the staffing firm and the accepting unit shall be a joint party.
Article 23. A third party with a material interest in the outcome of an employment case may apply, or may be notified by the labor arbitration commission, to participate in the arbitration activities.
Article 24. A party may appoint an agent to participate in the arbitration activities on his or its behalf. If a third party is appointed to participate in the arbitration activities, he shall submit to the labor arbitration commission a power of attorney signed or sealed by the principal, and such power of attorney shall specify the entrusted matters and the authority of the agent.
Article 25. If a worker has lost all or part of his capacity for civil acts, his statutory agent shall represent him in the arbitration activities. If he does not have a statutory agent, the labor arbitration commission shall designate an agent for him. If a worker has died, a close member of his family or his agent shall participate in the arbitration activities.
Article 26. The arbitration of an employment dispute shall be conducted in public, unless the parties agree that it not be conducted in public or if state secrets, trade secrets or personal privacy is involved.
Section 2. Application and Acceptance
Article 27. The time bar for applying for arbitration in an employment dispute shall be one year. Such time bar shall commence to count from the date on which a party knew or should have known that his or its rights were infringed upon.
The time bar for arbitration specified in the preceding paragraph shall be interrupted if a party asserts his or its rights against the other party or seeks a rights remedy from the relevant authority, or if the other party agrees to perform his or its obligations, and shall be counted anew from the time of interruption.
The arbitration time bar specified in the first paragraph hereof shall be suspended if force
majeure or another legitimate reason prevents a party from applying for arbitration before the arbitration time bar sets in, and counting of the time bar shall resume from the date on which the reason for its suspension is eliminated.
If a dispute over overdue labor remuneration arises during the term of an employment relationship, the application for arbitration by the worker shall not be subject to the time bar specified in the first paragraph hereof. However, if the employment relationship has terminated, he shall submit his application within one year from the date on which the employment relationship terminated.
Article 28. A party wishing to apply for arbitration shall submit a written application for arbitration, and submit copies thereof in a number equivalent to the number of respondents.
An application for arbitration shall specify the following:
(1) the worker’s name, sex, age, profession, work unit and home address, the employer’s name, domicile and the name and position of its legal representative or main person in charge;
(2) the arbitration claims and the facts and grounds on which they are based; and
(3) the evidence, the source of the evidence and the names and home addresses of witnesses.
An applicant that truly has difficulty writing an arbitration application may make an oral application, in which case the labor arbitration commission shall make a record thereof and notify the other party.
Article 29. If the labor arbitration commission finds the application to comply with the conditions for acceptance, it shall accept the application and notify the applicant and if it finds that the application does not comply with the conditions for acceptance, it shall notify the applicant in writing of the non-acceptance and explain the reason, in either case within five days from the day of receipt of the application for arbitration. If the labor arbitration commission does not accept the application or if it fails to make a decision within the time limit therefor, the applicant may institute an action with a People’s Court in respect of the subject matter of the employment dispute.
Article 30. The labor arbitration commission shall serve a copy of the application for arbitration on the respondent within five days after it accepts the application.
The respondent shall deliver a written answer to the labor arbitration commission within 10 days after receiving the copy of the arbitration application. The labor arbitration commission shall serve a copy of the answer on the applicant within five days of receiving it. The respondent’s failure to deliver a written reply will not affect the arbitration process.
Section 3. Hearing and Award
Article 31. Labor arbitration commissions shall use the tribunal system to decide employment cases. Arbitration tribunals shall be composed of three arbitrators and have a chief arbitrator. Simple employment cases may be arbitrated by a sole arbitrator.
Article 32. A labor arbitration commission shall notify the parties in writing of the composition of the arbitration tribunal within five days from the date on which it accepted the application for arbitration.
Article 33. An arbitrator shall recuse himself, and the parties shall have the right to challenge an arbitrator orally or in writing, if the arbitrator:
(1) is a party to the case or a close relative of a party or of a party’s agent;
(2) is materially interested in the case;
(3) has some other relationship with a party to the case or with a party’s agent that could affect the impartiality of the arbitration; or
(4) has met privately with, been entertained by or accepted a gift from, a party or a party’s agent.
The labor arbitration commission shall render a decision on the challenge in a timely manner and shall notify the parties thereof orally or in writing.
Article 34. If an arbitrator has done anything described in item (4) of Article 33 hereof or if he has demanded or accepted a bribe, committed graft or rendered an award that perverted the law, then he shall be legally liable in accordance with the law and the labor arbitration commission shall dismiss him.
Article 35. The arbitration tribunal shall give the parties five days’ prior written notice of the date and place of the hearing. A party may, three days prior to the hearing, request a postponement of the hearing if it or he has a legitimate reason for such request. The decision whether to postpone the hearing shall be made by the labor arbitration commission.
Article 36. If the applicant, after receipt of the written notice, refuses to appear before the tribunal without a legitimate reason or withdraws early from the hearing without the consent of the arbitration tribunal, he or it may be deemed to have withdrawn the application for arbitration.
If the respondent, after receipt of the written notice, refuses to appear before the tribunal without a legitimate reason or withdraws early from the hearing without the consent of the arbitration tribunal, a default award may be rendered.
Article 37. If the arbitration tribunal is of the opinion that an issue of a specialized nature requires an expert evaluation, it may refer the issue to an expert evaluation organization agreed upon by the parties for expert evaluation. If the parties have not agreed on or are unable to reach agreement on such an evaluation organization, the evaluation shall be carried out by an expert evaluation organization designated by the arbitration tribunal.
If requested by a party or required by the arbitration tribunal, an expert evaluation department shall send expert evaluators to attend a hearing. Subject to the permission of the arbitration tribunal, the parties may put questions to the expert evaluators.
Article 38. The parties have the right to cross-examine and to argue during the arbitration process. Upon conclusion of the cross-examination and arguments, the chief arbitrator or the sole arbitrator shall solicit the final comments of the parties.
Article 39. Once evidence submitted by a party is verified as being genuine, the tribunal shall treat the same as a basis for determining the facts.
If the worker is unable to submit evidence relating to the arbitration claims that is in the possession or under the control of the employer, the arbitration tribunal may require the employer to provide such evidence by a specified deadline. If the employer fails to provide the same by the specified deadline, such failure shall be held against it.
Article 40. The arbitration tribunal shall keep a record of the hearing. The parties and other participants in the arbitration shall have the right to apply to have the record of their statements supplemented or corrected if they believe the same to contain an omission or error.
If the statement is not supplemented or corrected, the application shall be recorded.
The record shall be signed or sealed by the arbitrators, the clerk, the parties and the other participants in the arbitration.
Article 41. After an application for arbitration of an employment dispute has been made, the parties may settle on their own. If a settlement agreement is reached, the application for arbitration may be withdrawn.
Article 42. The arbitration tribunal shall conduct mediation prior to rendering an arbitration award.
If mediation leads to an agreement, the arbitration tribunal shall prepare a written mediation statement.
The written mediation statement shall specify the arbitration claims and the result of the agreement between the parties. The written mediation statement shall be signed by the arbitrators and the seal of the labor arbitration commission shall be affixed to it. After the written mediation statement has been so signed and sealed, it shall be served on both parties.
The written mediation statement shall become legally effective after both parties have signed for receipt thereof.
If the mediation is unsuccessful or one of the parties reneges prior to the service of the written mediation statement, the arbitration tribunal shall promptly render an award.
Article 43. An arbitration tribunal shall render its award in an employment case within 45 days from the date on which the labor arbitration commission accepted the application for arbitration. Subject to the approval of the chairman of the labor arbitration commission, this time limit may be extended by up to 15 days for complicated cases that require an extension; the parties shall be notified of such extension in writing. If no arbitration award has been rendered within the time limit, either party may institute an action with a People’s Court in respect of the subject matter of the employment dispute.
If, during an arbitration tribunal’s arbitration of an employment case, part of the facts involved has already become clear, the tribunal may first make an award in respect of such part of the facts.
Article 44. In a case involving recovery of labor remuneration, medical bills for a work-related injury, severance pay or damages, the arbitration tribunal may, upon application by a party, render an award for advance execution and transfer the case to the People’s Court for execution.
To render an award for advance execution, the following conditions shall be satisfied:
(1) the rights and obligations of the parties vis-à-vis each other are clear; and
(2) failure to carry out advance execution will materially affect the livelihood of the applicant.
A worker shall not be required to provide security when applying for advance execution.
Article 45. An award shall be made in accordance with the opinion of the majority of the arbitrators. The dissenting opinion of the minority of the arbitrators shall be entered in the record. If the arbitration tribunal is unable to form a majority opinion, the award shall be made in accordance with the opinion of the chief arbitrator.
Article 46. The written arbitration award shall specify the arbitration claims, the facts of the dispute, the grounds for the award, the result of the award and the date of the award. The written arbitration award shall be signed by the arbitrators and the seal of the labor arbitration commission shall be attached to it. An arbitrator with a dissenting opinion as to the arbitration award may either sign or not sign the award.
Article 47. Unless otherwise specified herein, the written arbitration award in any of the following employment disputes shall be final and become legally effective on the date it is rendered:
(1) disputes involving recovery of labor remuneration, medical bills for a work-related injury, severance pay or damages, in an amount not exceeding the equivalent of twelve months of the local minimum monthly wage rate;
(2) disputes over working hours, rest, leave, social insurance, etc. arising from the implementation of state labor standards.
Article 48. A worker dissatisfied with an arbitration award as specified in Article 47 hereof may institute an action with a People’s Court within 15 days from the date of receipt of the written award.
Article 49. If the employer can produce evidence that proves that an arbitration award as specified in Article 47 hereof involves any of the following circumstances, it may submit an application for vacation of the award to the Intermediate People’s Court of the place where the labor arbitration commission is located within 30 days from the date of receipt of the written arbitration award:
(1) there truly was an error in the application of laws or statutes;
(2) the labor arbitration commission did not have jurisdiction;
(3) the statutory procedure was violated;
(4) the evidence on which the award is based is fabricated;
(5) the other party concealed evidence sufficient to affect the fairness of the award; or
(6) while arbitrating the case, one or more of the arbitrators demanded or accepted a bribe, committed graft or rendered an award that perverted the law.
If the collegiate bench organized by the People’s Court, through examination, verifies that the award involves any of the circumstances specified in the preceding paragraph, the People’s Court shall rule to vacate such award.
If the People’s Court rules to vacate the arbitration award, a party may institute an action with the People’s Court in respect of the subject matter of the employment dispute within 15 days from the date of receipt of the written ruling.
Article 50. A party dissatisfied with an arbitration award rendered in an employment case other than one as specified in Article 47 hereof may institute an action with a People’s Court within 15 days from the date of receipt of the written award. If no action is instituted within the time limit, the award shall become legally effective.
Article 51. Written mediation statements and arbitration awards that have become legally effective shall be complied with by the parties within the stipulated time limit. If a party fails to comply within the stipulated time limit, the other party may apply to a People’s Court for enforcement in accordance with the relevant provisions of the Civil Procedure Law. The People’s Court that accepts the application shall carry out the enforcement in accordance with the law.
CHAPTER 4. SUPPLEMENTARY PROVISIONS
Article 52. If an employment dispute arises between an institution and a member of the working personnel of such institution who is subject to the employment system, matters shall be handled in accordance with this Law, unless laws or administrative statutes contain, or the State Council has formulated, separate regulations, in which case matters shall be handled in accordance with such regulations.
Article 53. The arbitration of employment disputes is free of charge. The expenses of labor arbitration commissions shall be covered by the government.
Article 54. This Law shall be implemented from May 1, 2008.
