Guides - Human Resources & Payroll in China 2016

- Human Resources and Payroll in China 2016-2017 (5th Edition)

4.1 Terminating During the

Probation Period

Under the current Labor Contract Law, both the company and the employee are allowed to

dissolve the labor contract unilaterally by giving three days’notice. Nevertheless, while employees

can terminate the contract at will, the company can only dismiss an employee on probation if it

turns out the employee doesn’t satisfy the job requirements, in addition to the regular causes for

dismissal (detailed below in section 4.2). To be noted, the burden is on the company to prove that

an employee has not been able to meet the requirements of the position they were hired to fill.

There are two aspects involved here:

1. The job description shown to the employee prior to being hired must be specific enough

to give valid grounds to the employer for dismissing the employee if the employee proves to

be unsatisfactory. It should clearly indicate the key roles that the employee will be expected to

perform and the relevant skills that the employee should possess.

2. The company must gather clear evidence to prove that the employee has not been able to

meet the requirements that were established.

The probation period appraisal form can be used as the basis for assessing the suitability of the

employee and the degree to which they meets the requirements for the position. This will be a

useful piece of evidence if the company wishes to dissolve the relationship at this point.

HR departments may also want to introduce more forms to make the appraisal process more

specific. For instance, some companies have their managers sit down with employees during their

first week and set tasks for which employees will be assessed during this probation period. These

tasks are summarized in a document which is signed by the employee and employer. At the end of

the probation period, the employee is assessed based on the degree to which these specific tasks

were completed. Managing the probation period in this way further reduces the scope for dispute

in the future, although there is a larger administrative burden on the managers involved.

To terminate an employee on probation period, the company is not required by law to pay severance

payment.