Corporate compliance series | Part 3: Employment compliance
Topic and guest introduction
Labor issues are also an important part of every enterprise’s daily management. How to integrate labor into compliance management and solve labor-management problems in accordance with the law is an important issue for many enterprises. That is why to provide more insights on this topic, we had a Q&A session with Ms. Li from Allbright and she kindly provided us with an overview and suggestions for companies on what to focus on and how to mitigate potential risks.
Employment compliance
SONG: Ms. Li, thank you again for your time. What would you say is one of the first steps towards corporate employment compliance?
Ms. Li: I think Enterprises should formulate reasonable and legal rules and regulations. Enterprise rules and regulations are generally in the form of the employee handbook, performance appraisal, attendance system, disciplinary rules, and other rules and regulations directly related to employee labor relations management. It is not a paper document, but an important guarantee for workers to enjoy their labor rights, and an important guarantee to achieve the purpose of enterprise management and a basis for dealing with employees who violate the rules and regulations.
The rules and regulations of an enterprise should be subject to democratic procedures, which include a discussion by the employees’ representative assembly or all employees, and equal consultation between the enterprise and the labor union or employees’ representatives. The content of the enterprise rules and regulations should be set out in the form of an enumeration of possible violations by the employees, and these behaviors should be detailed and exhaustive to cover as much as possible, otherwise, if the rules and regulations are formulated in violation of the law or the relevant content is not comprehensive, they will face the legal basis of the court to determine that they cannot be used as the basis for the disciplinary system, and thus the enterprise will bear the corresponding legal responsibility. Therefore, if there is a lawyer involved in the process of writing, developing, and training the rules and regulations of the enterprise, it can provide protection for the later litigation risk control.
Employee management during a pandemic
SONG: Thank you for such a detailed reply. Considering that in 2020 many companies were not prepared to move their employees to home-office. How to do personnel management in the face of emergencies such as epidemics?
Ms. Li: To cope with the new epidemic and reduce the burden on enterprises, the Ministry of Human Resources and Social Security has proposed that “enterprises with conditions can arrange for employees to work from home through flexible working methods such as telephone and internet to complete their work tasks. However, working from home poses new challenges to the management of labor relations, including attendance, labor quota management, protection of trade secrets and recognition of work-related injuries, etc. So how should units respond to these new challenges? In the face of all kinds of emergencies, lawyers’ compliance advice can play an important role in compliance risks incorporate personnel.
For the above problem, we think: according to Article 17 of the Labor Contract Law, the workplace is one of the necessary terms of the labor contract, if the labor contract has agreed on the attendance method and working method, the arrangement of the employee’s home office is a change of the workplace, which is a necessary term of the labor contract, in principle, the unit needs to work with the employee In principle, the unit should agree with the employee and suggest to operate by changing the employment contract. If the unit arranges employees to work at home, it should pay attention to the clear attendance method, and if the attendance method is not clear, the unit will not be able to prove that the employee is absent from work. Accordingly, it is recommended that the company should require the employees to clock in and out regularly and form electronic attendance records. The company should send the employees’ electronic attendance records to the employees every week or every month and ask them to confirm whether they have any objection to the electronic attendance records.
Employee termination
SONG: Thank you Ms. Li and last question, what would you name top termination risks for the enterprises?
Ms. Li: Terminating an employee is a challenge that every company will encounter. In our opinion, there are several aspects to consider regarding the risk assessment of dismissal. Here is some risk that the company should consider:
- Is there a law or relevant system as the basis for the dismissal action?
- Is there any fact of violation and is there sufficient evidence? (ii) If the fact of violation is not serious, the dismissal of violation is not easily done.
- Pay attention to the timeliness, otherwise, it may be attributed to the enterprise’s negligence in exercising management rights.
- Is the dismissal act fair? Whether there is discrimination or differential treatment.
- Examine whether criminal offenses are involved.
- Pay attention to whether the enterprise has management negligence, if it is too obvious, there may be suspicion of transferring negligence.
The issue of dismissal of enterprise employees is more complex, the above is only the general situation under the recommendations, the specific situation still needs to be combined with the detailed facts and local legal provisions and policies of common judgment, to receive professional advice for enterprises to make the right decision it is always better to contact a professional firm which could advise on your specific case.
SONG: Thank you Ms. Li for your suggestions and input.
In the next part, we will discuss anti-corruption and criminal compliance.
If you have any questions and would like to learn more, feel free to contact us
