On March 16, 2017, the Guangdong provincial government issued the Guangdong Provincial Measures on Handling Employment Disputes. The measures streamline Guangdong's employment dispute resolution system by aligning it with current practices in national law and rules on dispute prevention, mediation and arbitration. The measures will take effect on May 1, 2017.

Specifically, the measures:

·         require employers to establish internal negotiation mechanisms with employees and to respond timely to employee complaints and claims;

·         require mediation organizations to close labor dispute mediation within 15 days after receiving the mediation application;

·         allow the labor arbitration commission to adopt simplified procedures by shortening the evidence submission and defense periods and by issuing decisions based solely on documentary evidence without holding a hearing;

·         require employers facing a major change in circumstances that renders performance of employment contracts impossible to develop a working plan, which can include employee adjustment plans, employment contract amendment, termination or renewal plans, etc.

·         allow the labor arbitration commission to request the local trade union, industry association or competent administrative department to participate in arbitration and assist in mediation during group labor disputes involving more than 50 employees; and

·         require arbitration parties in an employment dispute to corroborate the source of audio, video and electronic evidence (audio and video evidence must be accompanied by a transcript of the recording).

On March 27, 2017, the Guangzhou Intermediate People's Court published eight judicial guides for trial judges. One of these judicial guides addresses employment disputes and includes the following topics: dispute resolution procedures, identification of employment relationships, employment remuneration, social insurance benefits, and termination and severance.

Specifically, the judicial guide reiterates that:

·         a company policy can be recognized as valid even without first going through the employee consultation procedure if the policy complies with all laws and regulations, contains no obviously unreasonable provisions, and has been publicized or notified to employees with no employee objections raised; and

·         a company must establish a service relationship with any employee who reaches the statutory retirement age even if the employee is not entitled to a pension.

Key take-away points:

Guangdong is streamlining its labor arbitration procedures to reduce arbitration-related burdens and time delays.

Additionally, employers in Guangdong need to handle group labor disputes carefully, and should prepare comprehensive working plans when dealing with employment relationships impacted due to a major change in objective circumstances.

It should also be noted that the courts in Guangzhou have reiterated their flexible attitude in dealing with the employee consultation procedure for adopting employee handbooks and other employment-related policies, and that individuals who work passed the retirement age will be deemed to have a service relationship even if they do not enjoy pension benefits.