In a recent case in Suqian City, Jiangsu Province, a court held that an employee’s personal information form and confidentiality agreement with the company could not be deemed as a written employment contract. Because there was no written employment contract, the court upheld an arbitration award granting the employee double salary from the employee’s second to eleventh month of employment.
The employee joined the company on August 1, 2014 and completed a personal information form the same day. The company and the employee signed a confidentiality agreement the next month. In August 2015, the employee was terminated by the company for being absent from work and for serious violations of company rules.
Although the court held that the personal information form and the confidentiality agreement demonstrated a de facto employment relationship between the parties because the documents stated part of the company’s and employee’s rights and obligations, the court further held that neither the personal information form nor the confidentiality agreement separately or together could be deemed as a written employment contract. First, the personal information form and the confidentiality agreement did not include mandatory employment contract provisions, such as provisions on the term of employment, job description, place of work, working hours, rest and leave periods, remuneration, social insurance, labor protection, work conditions, etc. Second, the personal information form and the confidentiality agreement were intended to obtain the employee’s personal information and to impose confidentiality obligations on the employee rather than to clarify the employment relationship or to serve as the written employment contract for that relationship.
Key Take-Away Points:
This case emphasizes the importance of signing written employment contracts with employees, and for such contracts to include the mandatory provisions required for employment contracts. No other employment document, including a personal information form or a confidentiality agreement, can serve as a substitute for a written employment contract. Failure to sign a written employment contract can result in arbitration and court awards granting double salary to employees.