Guides - Human Resources & Payroll in China 2016 - 2017 (5th

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Human Resources and Payroll in China 2016-2017 (5th Edition) - 39
outsourcing companies, on the other hand, will be more concerned with confidentiality of their
clients’ information, while the food industry will focus on hygiene, etc.
When drafting a company rulebook, keep in mind the following considerations:
• Ensure the company rulebook is bilingual English-Chinese.
• If the company has a trade union, the union will have to agree to the terms.
• Have the labor contract make clear reference to the company rulebook. This will strengthen the
company’s case if you need to dismiss an employee over a breach of company rules.
• Avoid writing a company rulebook that is too lengthy. This may unnecessarily burden your staff
to stay in compliance, and increases the workload of the HR department in supervising the rules.
• If a dispute is taken to court, and the company is found to have set arbitrary rules in order to find
reasons to fire employees, the judge is more likely to decide in the employee’s favor. You should
be prepared to explain why each of the regulations is included. Have the rulebook differentiate
betweenminor andmajor breaches. For aminor breach, the employee is issued an official warning
letter. A major breach can result in immediate dismissal. Also, specify how many minor breaches
may constitute a major breach. This way, the company may gain the right to dismiss an employee
without compensation. Do keep in mind that your decision whether a breach was sufficiently
serious to warrant dismissal can be challenged in court.
• Have each employee sign a statement that he/she has read, understood and agreed to the
rulebook. When you change the rulebook, have employees make a new written statement. This
improves your position in the event of a court case, and encourages your employees to read the
rules more carefully.
Verify the labor contracts in the local Labor Bureau
In many cities, employers are required to give draft labor contracts to the local Labor Bureau for
verification. Failure to do this can result in the company having trouble issuing social insurance to
its employees, and the validity of some of its contracts can be challenged in court. Companies must
also seek approval when making amendments to a contract.
Finally, all contracts need to be signed by the employee and chopped with the company seal before
they are considered valid.