Case Information

Appellant (defendant in the original trial): Jing Long Technology (Suzhou) Co., Ltd.

Respondent (plaintiff in the original trial): Zhang Jianming

Court: Suzhou Intermediate People's Court of Jiangsu Province

Key Facts:

April 13, 2009 was a rest day for Zhang Jianming, an employee working for Jing Long Technology (Suzhou) Co., Ltd. (“Jing Long”). On 10:00 a.m., he took an unlicensed taxi with No. SuE8D891 heading for the dormitory area of Jing Long. On Aril 20, Jing Long issued a dismiss notice to Zhang Jianming, terminating the employment contract on the ground that Zhang took the illegally-operating taxies. Before this, Jing Long has held the assembly of employee representatives on September 8, 2008, adopting a resolution stating that “employees should not take any unlicensed taxi; or otherwise, he or she will be dismissed”.

Zhang Jianming challenged the termination decision and applied to Labor Dispute Arbitration Committee of Suzhou Industrial Park for arbitration. The Committee rejected all the arbitration claims of Zhang Jianming on July 27, 2009. Later, the People’s Court of Suzhou Industrial Park ruled that Jing Long’s termination of the employment contract is solely based on Zhang Jianming’s taking the illegally-operating taxi, which prejudices the legitimate rights and interests of employees. Thus, Jing Long shall compensate Zhang Jianming pursuant to the Employment Contract Law in the total amount of RMB 7,800.

Jing Long appealed to Suzhou Intermediate People's Court.

Judgment:

The court of the second trial dismissed the appeal and sustained the original judgment.

Key Points of the Judgment:

Internal policies formulated by employers should not only comply with laws and regulations, but also be rational and reasonable. The scope should not be extended to a limitless range that is even beyond the sphere of working process and labor management.

In this case, Respondent Zhang Jianming took an illegally-operating taxi on his rest day. Employees have the right to govern their own behaviors and the company may not restrain their behaviors on the rest period according to its internal policies which only apply during working days. Which vehicle the employees take to work falls within their private sphere and the employer may not formulate any mandatory provisions on this matter. Even if an employee carries out certain illegal behaviors, he/she should be punished by authorized authorities like administrative department. Therefore, Jing Long’s termination of the employment contract due to Zhang Jianming’s taking of the illegally-operating taxi is unlawful, and Jing Long shall pay compensation to Zhang Jianming.

KWM Comments: Internal policies formulated by the employer should comply with not only the principle of legality (such as fulfilling the democratic and publicity procedures), but also the principle of rationality. The contents of a company’s internal policies which are too stringent may be ruled as invalid.