China Employment Law Update

Guangdong becomes the first province to implement the nationwide Two-Child Policy

In response to the amendment, on 30 December 2015 the 22nd plenum of the Standing Committee of the 12th NPC Guangdong voted to pass the newly revised Guangdong Population and Family Planning Regulation (the "New Regulation"). The New Regulation took effect on 1 January 2016 and made Guangdong the first province to implement the nationwide two-child policy. The key points are summarised below:

1. Couples are entitled to have two living children. If children have passed away, couples are permitted to have another child or children up to a maximum of two.
2. Additional maternity leave allowances where a female marries ("late-marriage") or gives birth over the age of 24 ("late-child birth") have been removed. Previously, if a female employee complied with the one-child policy, she was entitled to a maximum of 179 days maternity leave, which included the national standard 98 days, plus a potential extra 81 days comprising 30 days for dystocia, 15 days for late-child birth and 36 days for single child status. Under the New Regulation, maternity leave allowance has been reduced to a maximum of 158 days. It includes the national standard 98 days and a potential extra 60 days, comprising 30 days for dystocia and 30 additional days where the child is born in compliance with the new two-child policy.
3. The previous 10-day late marriage leave is removed.
4. Paternity leave allowance has been increased from ten days to 15.
5. Approval for the birth of two children is no longer required and has been replaced by a registration system.

Q&A by Shanghai Municipal Commission of Health and Family Planning regarding the Two-Child Policy

On 27 December 2015, the Standing Committee of the National People's Congress passed an amendment (the "Amendment") to the Law of the People's Republic of China on Population and Family Planning, which will give effect to the nationwide two-child policy (the "Policy") from 1 January 2016. Following the Amendment, the Shanghai Municipal Commission of Health and Family Planning gave an official response to some of the key questions being asked in respect of the Policy, as set out below:

• Q: When will Shanghai implement the nationwide two-child policy?
• A: From 1 January 2016.
• Q: From 1 January 2016, which couples do not need to go through re-delivery approval procedures for the second child?
• A: Couples who have only one child before 1 January 2016.
• Q: From 1 January 2016, which couples need to go through approval procedures for child birth?
• A: Couples who have given birth to two children before 1 January 2016.
• Q: How do couples apply for delivery registration?
• A: The relevant government organisations are designing delivery service measures in accordance with the regulation of the National Commission of Health and Family Planning and in consideration of their relevant local area. Shanghai will design specific delivery registration measures.
• Q: After implementation of the nationwide two-child policy, will the delivery of two children before 31 December 2015, in breach of the law, receive any penalty? Can the previously collected penalty be returned?
• A: The conduct of delivering two children before 31 December 2015 will continue to attract a penalty in accordance with the existing regulations. The penalty paid before 31 December 2015 for child birth against the law will not be returned.
• Q: Can citizens who register marriage after 1 January 2016 enjoy late-marriage holidays?
• A: No.
• Q: Can citizens who register marriage before 31 December 2015 but have not yet taken their late-marriage holidays still enjoy late-marriage holidays?
• A: Yes. Citizens who get married at the statutory late marriage age before 31 December 2015 can still enjoy late-marriage holidays, namely 7 additional days.
• Q: Can citizens who give birth to children after 1 January 2016 enjoy late-delivery holidays?
• A: No. But in accordance with the newly revised Population and Family Planning Law, couples who give birth to children in accordance with relevant regulations after 1 January 2016 can enjoy extended delivery holidays.
• Q: Can citizens of Shanghai who give birth to a single child after 1 January 2016 be awarded a One-Child Parents Certificate?
• A: No.

New Implementing Measures of the Trade Union Law of the People's Republic of China in Beijing

On 27 November 2015, the Standing Committee of NPC Beijing officially passed the Implementing Measures of the Trade Union Law in Beijing ("the Measures"), effective from 1 January 2016. The Measures reflect the position of trade unions would be strengthened, and will lead to increasing costs and more administrative/management pressure on Beijing enterprises. The highlights of the Measure are as follows:

1. Layoff Notification
   The Measures stipulate that enterprises shall inform all staff of any layoff plans "through staff representative congress or staff congress", and shall listen to the opinions of the trade union or employees. As the PRC Labour Contract Law has not specifically required enterprises to discuss layoff plans through staff representative congress or staff congress, particularly those who already have established trade unions. The Measures create an increased procedural burden on Beijing enterprises making layoffs, and accordingly the power of staff representative congress or staff congress would be enhanced.
2. Trade Union Fees
   Previously some local governments (including Beijing) attempted to require all enterprises without a trade union to make a payment of trade union fees. The PRC Trade Union Law prescribes that trade union fees shall be paid by the enterprise which has established the trade union. The Measures stipulate that where employees are willing to organise a trade union, the enterprise shall, upon the instruction of the organised trade union, contribute 2% of all staff salaries from the last month to a trade union organisation fund. This means in Beijing starting from 1 January 2016, only those enterprises which have already initiated the organising procedures of trade unions need to make such payment.
3. Collective Bargaining
   The Measures stipulate that if employees require collective bargaining with the enterprise, the enterprise shall not refuse or delay bargaining for any reason. But Beijing Collective Contract Regulation and local regulations of certain other cities (like Shanghai and Guangdong), have set out that an enterprise may refuse collective bargaining for "justifiable reasons". Such "justifiable reasons" are not clearly defined in law, and are usually given a narrow meaning (for example, the serious financial difficulty of the enterprise). It is advisable to keep a close eye on any future development in this respect, e.g. whether Beijing Collective Contract Regulation will be further amended.
4. Penalty for Breach
   The Measures stipulate that if an enterprise breaches the Measures (e.g. obstructing the organisation/activities of a trade union or refusing collective bargaining), relevant government bodies may order the enterprise to correct its conduct. Any refusal to correct a breach of the Measures will be recorded by the Labour Bureau and the administration for industry and commerce in the enterprise credit information system.