The Jiangsu Provincial People’s Court recently publicized the top ten employment cases in Jiangsu province in 2013, covering typical employment issues relating to employment relationships, working hours systems, employee termination, labor dispatch, etc., in order to provide guidance to the lower courts on these issues. The publicized cases included the following matters of note:

  • In one of the publicized cases, a fashion company obtained an approval of the comprehensive working hours system for the position of tailor, as well as a signature from an employee in the tailor position to implement the comprehensive working hours system. However, the court upheld the employee’s claim for overtime pay in accordance with the standard working hours system because the fashion company failed to use any means such as rest plans on a rotation basis to truly implement the comprehensive working hours system.
  • In another case, the court ruled that if a new company hires an individual who “internally retires” (neitui) from, or is a “laid-off” (xiagang) from, but still formally retains his/her employment relationship with the original employer, an employment relationship will still be deemed to be established between the new company and the individual and the individual can claim statutory severance for contract termination.
  • In another case, the court ruled that termination of a human resources manager based on the ground of “serious dereliction of duty, causing substantial damage to the employer” was lawful. In this case, the company was sued by four employees for failure to sign written employment contracts and the employment disputes arbitration commission ordered double wages and statutory severance in the amount of RMB 18,000 in total. It was found that the employees were re-employed after termination but the Human Resources manager failed to ensure that written contracts were signed even after the company provided the manager its comments on the contract version. The court held that the Human Resources manager’s dereliction of duty caused substantial damage to the company and thus ruled in favor of the company.

Some other local courts (e.g., Shunde and Zhongshan City in Guangdong province, as well as Suzhou and Wuxi city in Jiangsu province) also reportedly publicized employment cases for lower courts’ guidance and reference, or white papers regarding employment disputes. Although these reference cases and white papers are not legally binding on the lower courts, they provide guidance to the lower-level courts.