As a foreign employee working in China, you may encounter various legal issues. Here, we present the top ten frequently asked questions and provide answers below:
1. Q: Can employees terminate their employment contract without penalty?
A: Yes, employees can legally terminate their employment contract by providing a 30-day written notice without facing any penalty. According to Article 37 of the “Labor Contract Law of the PRC,” employees can terminate their contract by informing the employer in writing 30 days in advance. During the probation period, employees can terminate the contract with a three-day notice. Generally, employers cannot ask employees to pay penalties unless specified in the contract, such as for breaching a non-compete agreement or if the contract stipulates compensation for direct losses incurred by early termination.
2. Q: Can an employer refuse to provide a release letter when an employee resigns?
A: No, an employer cannot refuse to provide a release letter when an employee resigns. According to Article 50 of the “Labor Contract Law of the PRC,” employers are required to issue a certification for the discharge or termination of the employment contract within 15 days. Failure to provide the certification may result in penalties for the employer. It is the employer’s responsibility to provide release letters and assist in canceling work permits so that employees can apply for new permits in a timely manner.
3. Q: Can foreign employees participate in the social security plan in China?
A: Yes, foreign employees are required to participate in the social security plan as long as they are working legally in China. According to Article 72 of the “Labor Law of the PRC,” both employers and employees must participate in social insurance and pay premiums accordingly. The “Interim Measures for the Participation in Social Insurance of Foreigners Employed in China” also mandates that employers register foreign employees for social insurance within 30 days of their employment.
4. Q: Can an employer hold an employee’s passport or work permit?
A: No, it is not permissible for an employer to hold an employee’s passport or work permit. According to Article 9 of the “Labor Contract Law of the PRC,” employers are not allowed to detain identity cards or other certificates from employees. It is against the law for an employer to demand such documents as a guarantee or under any other pretext.
5. Q: How can employees ensure proper payment of individual income tax?
A: Employers are responsible for withholding and deducting individual income tax from employees’ salaries according to relevant tax laws. Each taxpayer can check their tax records at the local tax bureau by presenting their original passport. Visiting the tax bureau in the district where the employer is located allows employees to obtain printed records of their tax payments.
6. Q: What can employees do if their employment contract provisions are not in line with labor laws?
A: Although a signed contract is generally binding, it is essential that the provisions within it are legal. If the provisions in an employment contract are illegal or not in line with labor laws, they are not valid and, therefore, not binding. It is advisable to thoroughly read the employment contract before signing, ensuring understanding and compliance with applicable labor laws.
7. Q: Can an employer terminate an employee’s contract for being late to work?
A: According to Article 39 of the “Labor Contract Law,” an employer may terminate a labor contract under certain circumstances, such as when an employee fails to meet recruitment requirements during the probation period, seriously violates employer bylaws, causes severe damage due to negligence or personal gain, establishes labor relationships with other employers that affect their work, or engages in criminal activities. If an employer terminates a contract without justification, it constitutes illegal termination, and the employer may be required to provide severance payment.
8. Q: What are the regulations regarding severance payment?
A: According to the law, employers must provide a 30-day notice or one month’s salary in lieu of notice when terminating a labor contract. In cases of illegal termination by the employer, they are required to pay two months’ salary for each year the employee has worked. However, if the monthly salary exceeds three times the local average salary, the employee may only receive three times the local average salary instead of their actual salary.
9. Q: How can employees request severance payment if they are illegally terminated?
A: Employees can first try negotiating with their employer, but if they refuse to pay, there are other options. Filing a complaint with the local labor bureau or labor supervision authority can often resolve the issue quickly. If that fails, employees can pursue labor arbitration, the initial step for resolving any labor dispute through legal means. If either party is unsatisfied with the arbitration result, they can proceed to file a lawsuit. The second instance court is usually the final instance in general lawsuits in China.
10. Q: Can foreigners win labor dispute cases in China?
A: The purpose of labor laws is to protect employees, including foreigners legally working in China. The main challenge for foreigners in winning labor dispute cases is often the language barrier rather than any other factors. The court fee for labor disputes is typically only 10 RMB. However, without appropriate assistance, winning a case can be challenging for foreigners.
Note: It is advisable to consult with a legal professional or labor expert to obtain accurate and up-to-date information regarding specific labor laws and regulations in China.
