International Labor & Employment Law Committee Newsletter

Issue: September 2012

Editor: Tim Darby | European Editor: Paul Callaghan | Latin America Editor: Juan Carlos Varela | Canada Editor: Gilles Touchette | Asia and Oceania Editor: Ute Krudewagen

China, Page 1

First Reported Gender Discrimination Recruitment Lawsuit Accepted

Jeffrey Wilson and Zhao Fang, Jun He Law Offices, Shanghai

The first lawsuit alleging gender discrimination in hiring was reportedly accepted by a PRC court--the Haidan district court in Beijing--on July 11, 2012. Despite the relatively common practice of gender discrimination in hiring, this case is the first of its kind to reportedly make it to this preliminary stage of litigation.

The applicant reportedly based on her complaint on the PRC Constitution as well as on unidentified "other relevant laws." The relevant constitutional basis would be Article 48, which provides that women enjoy equal rights with men in all aspects of life, such as economic and social life. Given that successful constitutional claims are exceedingly rare, the claim would likely ultimately be decided based on the "other relevant laws." These laws would likely include the Employment Promotion Law and the Women's Rights Law, both of which ban gender discrimination in recruitment.

One reason for the lack of discrimination cases is that "gender discrimination" or a "right of equal employment" are not included among the causes of action authorized by the Supreme People's Court. Thus, in the case here, the district court would likely need to seek clarification from the Supreme Court on how the case could be classified as a proper cause of action.

In this case, a newly-graduated female, indentified only by the pseudonym Cao Ju, applied for a position as an office assistant at the Juren School in Beijing. Ms. Cao alleges that she was informed by a human resource employee at the school that her application was rejected because the position was open only to male candidates. The Juren School reportedly denied Cao's allegations, but removed a condition of "males only" from recruitment notices after the case was publicized.

First Comprehensive Law on Entry and Exit of Foreign Nationals Passed

Jonathan Isaacs, Baker & McKenzie, Hong Kong

The Law of the People's Republic of China on Entry and Exit Control, passed at the end of June by the National People's Congress, will take effect July 1, 2013.

While there have been existing regulations and notices related to the entry, exit and employment of foreigners, this is the first law in China to comprehensively address these issues. In the coming months, implementing regulations are expected on key provisions ranging from the new "talent" visa category to the employment of foreign students.

Under the law:

  • Foreigners are prohibited from engaging in activities not consistent with the purpose of the visit or stay in China, which can be a basis for being denied future entry. A foreigner may be "removed" (qiansong chujing) from China for illegal residence or employment, and in such a case will not be permitted re-entry during the next one to five year period. Violation of the new law under "serious" circumstances may lead to "deportation" (quzhu chujing), resulting in a 10-year bar. Foreign nationals may also be subject to administrative fines depending on the type of violation, and even be detained for five to 15 days.
  • A foreign national is deemed to be illegally employed if he or she: (1) works without having secured either a work permit or related residence permit; (2) engages in activities beyond the scope permitted by the work permit; or (3) is a foreign student engaging in activities beyond the scope permitted by the work-study position.
  • Employers may be subject to fines of RMB 10,000 per illegally employed person, up to a maximum of RMB 100,000, as well a confiscation of any income derived from the illegal employment.

"Part-Time" Employee Ruled to Be a De Facto Full-Time Employee

Jonathan Isaacs, Baker & McKenzie, Hong Kong

An employee who worked under a "part-time" employment contract was in fact a full-time employee, requiring severance pay on that basis, because the employer violated rules on working hours, salary calculation and timing of payment that apply to part-time employees, a Nanjing court ruled in July 2012

The employee signed an employment contract with his employer, a government-run institute in Nanjing. The employment contract provided that he should work on a part-time basis. The employee was later terminated without cause, and brought a lawsuit to the court claiming for severance pay. His employer argued that he was not entitled to any severance because he was not a full-time employee. The court found that the employee's daily working hours exceeded four hours and weekly working hours exceeded 24 hours, which is not consistent with the law on part-time employees' working hours. Furthermore, the court found that the employee was paid on a monthly basis, rather than every 15 days or less. Finally, the court pointed out that the monthly wage was calculated with reference to the monthly minimum wage for full-time employees, rather than being paid on an hourly basis as required for part-time employees. The court thus found that the Employee was actually a full-time employee of the Nanjing entity, and awarded severance pay to him.

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