GuoBanFa [1988] No.20 May 5, 1988

The report entitled "Proposals Concerning Further Implementation of the Policy of Granting Decision-Making Power to Enterprises with Foreign Investment for the Employment of Working Personnel" submitted by the Ministry of Labour and the Ministry of Personnel has been approved by the State Council. The Report is hereby transmitted to you for earnest implementation.

Attachment:

Proposals of the Ministry of Labour and the Ministry of Personnel Concerning Further Implementation of the Policy of Granting Decision-Making Power to Enterprises with Foreign Investment for the Employment of Working Personnel(Excerpts)

In order to improve the investment environment to facilitate the implementation of the strategy for the economic development in the coastal areas, the following proposals are hereby made on further implementation of the policy of granting decision-making power to enterprises with foreign investment for the employment of working personnel:

(1) Workers, technical personnel and administrative personnel (including senior administrative personnel) needed by enterprises with foreign investment may be employed by the enterprises openly from society; the enterprises may also select and employ their working personnel from among the personnel recommended by the Chinese joint venturers, their business partners. If the personnel employed from the local area cannot satisfy the needs of the enterprises, working personnel may be employed trans-regionally.

(2) In case that enterprises with foreign investment wish to employ working personnel from among workers and staff members on job, the departments and units concerned should give their active support and permit their working personnel to leave. The aforesaid departments and units should not impose any restrictions by charging payments or by taking back rooms or houses. In case that the original unit attempts to obstruct without any justification, workers or staff members who are employed by the aforesaid enterprises may resign. After resignation, their years of service shall still be counted without interruption. If any disputes arise, the person concerned may apply to the labour dispute arbitration committee in the local area, or to the service center for the exchange of personnel authorized by the local government for arbitration. All parties concerned must execute the arbitral award. If necessary, the transfer formalities may be performed on behalf of the engaged workers and staff members directly by the local labour or personnel departments.

(3) In case that enterprises with foreign investment go beyond the province, autonomous region, or municipality directly under the Central Government to employ workers and staff members, it is no longer necessary for them to submit their applications to the provincial department of labour or personnel for approval; the labour or personnel departments of the areas concerned should strive to do their organizational, coordinative and service work well.

(4) When a Chinese enterprise establishes a joint venture with foreign businessmen, the joint venture may select and employ the workers and staff members of the original Chinese enterprise according to needs. The Chinese side of the joint venture and the competent authorities over the joint venture shall make proper arrangements for the placement of those workers and staff members who are not employed; and the local government shall take an active part in assisting the department concerned to do the personnel regulation work.

(5) In the case that an enterprise with foreign investment dismisses workers and staff members in accordance with the contract and relevant provisions, no departments, units or individuals shall interfere. Of the dismissed workers and staff members, those who were on loan or temporarily employed shall be reaccepted by their original unit of work and those who were directly hired by the joint venture shall register for a new job with the local labour service company or the service center for the exchange of personnel at their original place or be offered a new post through the introduction of a department concerned, or organize themselves for self-employment, or look for a job themselves.

(6) The Chinese personnel, who hold the position of chairman of the board of directors or directors in a Chinese-foreign equity joint venture or in a Chinese-foreign contractual joint venture, shall not be transferred during their terms of office without authorization. If the transfer is necessary, the appointing unit shall solicit the opinions of the examining and approving organ of the said enterprise and of the foreign side of the joint venture. No departments and units have the right to transfer senior Chinese administrative personnel employed by an enterprise with foreign investment, during their terms of office as stipulated in the contract, to other positions without the consent of the said enterprise's board of directors and of the general manager.

(7) If there is any conflict between these Proposals and the pertinent regulations and provisions promulgated by the State Council and The former Ministry of Labour and Personnel, these Proposals shall prevail.

(8) Various areas and departments concerned should strengthen publicity and education among the leading cadres at various levels and the broad masses of workers and staff members for their better understanding of the matter and ensure that enterprises with foreign investment can exercise their decision-making power in selecting and employing working personnel in accordance with the practice prevalent in the world. Those who violate the pertinent laws and regulations and these Proposals, and use dishonest methods or devious means in handling cases concerning the employment or dismissal of workers and staff members, shall be criticized and admonished. If the cases are serious, investigations shall be conducted into the legal responsibilities of the persons concerned or disciplinary sanctions shall be given to them, in accordance with the actual circumstances.

Promulgated by The General Office of the State Council on 1988-5-5