9 Janauary, 2017
On 1 January 2017, a "name and shame" regime will come into effect in mainland China for employers who have acted in breach of PRC labour law. Under the Publishing Measures for Severe Violations Against Labour Protection (the “Publishing Measures”) published by the China Ministry of Human Resources and Social Security (the “MOHRSS”), the employer’s violation must have “serious consequences” for the name and shame provisions to apply.
The key aspects of the Publishing Measures are set out below:
Which violations may be published?
- unjustified deduction from, or delay in paying “substantial amounts” of employees’ remuneration, or refusal to pay remuneration if it results in criminal charges;
- failure to enrol an employee in social insurance or make social insurance contributions, if the circumstances are severe;
- severe violation of rules on:
- working hours, rest and leave;
- protection of female and juvenile workers;
- child labour;
- any violation against labour protection resulting in severe adverse social impact; and
- any other severe violations against labour protections.
What will be published?
- name, uniform social credit code (or registration number) and address of the employer or company who committed the violations;
- legal representative or the person in charge of the company committing violations;
- major facts of the violations; and
- any punishment.
Where will it be published?
The content will appear on the website of MOHRSS and in the local mainstream media.
How often can it be published?
Considerable discretion has been retained as notices may be published at any time. However the general guidelines are for them to be made once every quarter if published by the municipal level of MOHRSS and once every six months if published by the provincial or national level of MOHRSS.
Comment
It remains to be seen whether MOHRSS will use the regime and how aggressive it will be. Whilst the law is drafted to place the emphasis on breaches with a severe adverse impact, this may differ for each violation depending upon the circumstances of the particular employee(s). In addition, local interpretations may vary greatly.
In order to protect themselves, employers are advised to ensure that they get the basics right in terms of wages, social insurance, working hours and leave. As a preliminary step, do an audit and check that local management and HR know
how to calculate pay, what must be filed, all deadlines and record-keeping obligations.
Jack Cai, Managing Partner, Eversheds
jackcai@eversheds.com
