Following the change of the labour dispatch laws in early 2014, the grace period given to companies to assist with the transition will end in respect of more and more employees during 2015. On that basis, we expect to continue to see more dispatched employees hired directly by the end user while other positions will be outsourced which is expected to change the workforce demographic this year.
Following a trend that has emerged over the last few years, we expect to see more corporate restructurings in 2015 with the unfortunate potential consequence of more redundancies. On the heels of this, it is likely that employees’ appetites for compensation may further increase, meaning the costs of such exercises are likely to also increase. In the context of mergers and acquisitions, this trend has extended to employees increasingly making claims for severance payments upon a change of ownership, even in circumstances where the employees have no legal grounds to raise such claims.
Hand in hand with more employees asserting their rights and views, we expect to see a continuing upward trend of collective action by employees and their continued use of the internet and social media as a powerful tool to garner public attention. Employers should make sure they are prepared for the challenges this presents and in particular, should take all necessary actions to control the use of social media by their employees in the context of their employment.
The tragic industrial accident in Kunshan in 2014 involving an explosion at a car parts factory and the severe punishment imposed by the government show that the company management and the legal representative may face criminal prosecution and imprisonment in cases of serious safety accidents, regardless of whether they are Chinese nationals or not. This will make implementing safety rules and providing proper safety training of the employees, especially in manufacturing facilities, a priority for employers.