The State Council July 26, 1980

Article 1 Labour management problems concerning Chinese-foreign equity joint ventures (hereinafter referred to as "joint ventures") shall all be handled in accordance with these Provisions, in addition to the pertinent stipulations in Article 6 of the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures.

Article 2 Matters pertaining to employment, dismissal and resignation of the workers and staff members, tasks of production and other work, wages and awards and punishment, working time and vacation, labour insurance and welfare, labour protection and labour discipline in joint ventures shall be stipulated in the labour contracts signed.

A labour contract is to be signed by a joint venture and the trade union organization in the joint venture collectively. A relatively small joint venture may sign contracts with the workers and staff members individually.

A signed labour contract must be submitted to the labour management department of the government of the province, autonomous region or municipality directly under the Central Government for approval.

Article 3 The workers and staff members of a joint venture either recommended by the authorities in the locality in charge of the joint venture or the labour management department, or recruited by the joint venture itself with the consent of the labour management department, shall all be selected by the joint venture through rigorous examinations.

Joint ventures may run workers' schools and training courses to train managerial personnel and skilled workers.

Article 4 With regard to the workers and staff members who become redundant as a result of changes in production and technical conditions of the joint venture, those who fail to meet the requirements after training and are not suitable for other jobs in the joint venture can be discharged. However, this must be done in accordance with the stipulations in the labour contract and the enterprise must give compensation to these workers.

The dismissed workers and staff members will be assigned to other jobs by the authorities in charge of the joint venture or the labour management department.

Article 5 The joint venture may, according to the degree of seriousness of the case, take action against those workers or staff members whose violation of the rules and regulations of the enterprise has resulted in certain bad consequences. Punishment by discharge must be reported to the authorities in charge of the joint venture and the labour management department for approval.

Article 6 With regard to the dismissal and punishment of workers and staff members by the joint venture, the trade union has the right to raise objections if it considers them unreasonable, and send representatives to seek a solution through consultation with the board of directors. Should the consultation fail to arrive at a solution, the matter shall be handled in accordance with the procedures set forth in Article 14 of these Provisions.

Article 7 When workers and staff members of a joint venture, on account of special circumstances, submit their resignation to the enterprise through the trade union in accordance with the labour contract, the enterprise shall give its consent.

Article 8 The pay levels of workers and staff members in a joint venture shall be determined at 120-150% of the real wages of workers and staff members of state-owned enterprises of the same trade in the locality.

Article 9 The wage standards, the forms of payment, and bonus and subsidy systems are to be discussed and decided by the board of directors.

Article 10 The rewards and welfare funds drawn by the joint venture from the profits must be used as rewards and collective welfare and shall not be diverted to other uses.

Article 11 A joint venture must pay for the Chinese workers' and staff members' labour insurance, cover their medical expenses and various kinds of government subsidies in the line with the standards obtaining in state-owned enterprises.

Article 12 The employment of foreign workers and staff members and their dismissal, resignation, pay, welfare and social insurance and other relevant matters shall all be specified in the employment contracts.

Article 13 Joint ventures must implement the relevant rules and regulations of the Chinese Government on labour protection and ensure safety in production and civilized production. The labour management department of the Chinese Government has the right to supervise and inspect their implementation.

Article 14 Labour disputes occurring in a joint venture shall first of all be solved through consultation by the two parties. If consultation fails to arrive at a solution, either party or both parties may request arbitration by the labour management department of the people's government of the province, autonomous region or municipality directly under the Central Government where the joint venture is located. Either party that disagrees to the arbitration award may file a suit at a people's court.

Article 15 The power of interpretation of these Provisions resides in the State Bureau of Labour of the People's Republic of China.

Article 16 These Provisions shall enter into force as of the date of promulgation.

Promulgated by The State Council on 1980-7-26