China Employment Law Update - Digital Etiquette

LEGITIMACY OF DISMISSAL IN SOCIAL MEDIA ISSUES

The People’s Republic of China (PRC) Labour Law states that an employer may terminate employment where the employee has:

• Seriously violated labour disciplines or the rules and regulations of the employer.
• Caused material losses to the employer due to serious dereliction of duty or engagement in malpractice for selfish ends.

Employers can ensure they have the right to terminate employees who use social media during working hours by imposing clear limits or prohibitions in internal regulations. Labour courts will uphold the legitimacy of employers’ regulations that restrict employees’ use of social media.

However, achieving a lawful termination can still be difficult. Collecting evidence proving employees’ use of social media in breach of employers’ regulations is problematic. In addition, the PRC Labour Law does not clearly define “material losses.” This poses difficulties for employers seeking justification for dismissal. The Internet’s rapid development also means that new methods of communication are constantly emerging. Employers’ regulations will never be completely current, and cannot possibly cover all aspects of employees’ online behaviour. Businesses need to review and update their regulations frequently to keep up with the pace of development.

DATA LEAKAGE

The PRC Labour Law states: "The parties to a labour contract may reach an agreement in their labour contract on matters concerning the preservation of the commercial secrets of the employer."

Social media has ushered in an age of unprecedented information sharing. This greatly increases the risk that employers’ business information may be made public, and that leaks of confidential data can cause substantial losses. It is likely that PRC law will allow employers to lawfully dismiss employees who, whether intentionally or unintentionally, leak confidential company data without permission. However, employers may have difficulty showing that employee behaviour amounts to a disclosure of confidential data, or whether the employer is likely to suffer material loss.

In 2012, a local TV station was accused on Weibo of appropriating five pictures of a Weibo user in its New Year gala. A station director made an unofficial response to the accusation through his personal Weibo account, which was registered to his real name and job title. His response revealed information about the preparation of the gala and was viewed negatively by other Weibo users, thus adversely affecting the station’s reputation. However, it was difficult for the station to measure how much loss it had suffered, and also whether the behaviour amounted to a disclosure of confidential data. Ambiguities of this kind mean that employers cannot be certain of winning claims against employees who post sensitive material online. Although this will not remove the risk altogether, having clear internal rules on what employees are and are not allowed to do online will help to prevent this type of scenario.

INFRINGEMENT OF THE INDIVIDUAL RIGHT OF REPUTATION

The PRC General Rule of Civil Law states: "Citizens and legal persons shall enjoy the right of reputation. The personality of citizens shall be protected by law, and the use of insults, libel or other means to damage the reputation of citizens or legal persons shall be prohibited." Social media has changed the way people communicate; now every comment or statement can be read and shared by others. This has coincided with an increase in cases concerning employees’ online infringement of their employers’ individual rights of reputation. To avoid breaching the defamation law, social network users must be cautious about the words they post online and the content they share with others. Employers should take heart that under this law, online conduct by employees that risks damaging employers’ reputations may be actionable. Again, employers should expressly prohibit this type of conduct in their regulations. This gives businesses the best chance to lawfully dismiss employees who engage in online behaviour that may be damaging to the company.

Social media has become an essential tool for communication. However it is also a sensitive issue that has triggered numerous employment-related lawsuits in China. With the increasing popularity of social media, the Chinese government is certain to release further regulations and judicial documents to clarify these issues. Employers should ensure they remain on top of this extremely hot topic.

This article was first published in FOCUS Magazine, January 2016