Summary

Regulations on Administration of Online Recruitment Services and Its Accompanying Local Rules Took Effect

Interim Regulations on Administration of Registration and Record of Directors, Supervisors and Senior Managers of Financial Holding Companies Promulgated

Shenzhen Released dhy大红鹰3366 First Local Sexual Harassment Prevention Guide

Liaoning Issued Regulations on Special Protections for Female Employees

Beijing Formulated Policy on Individual Income Tax Subsidy for Overseas High-end Talents

Several Different Regions Unveiled Typical Labor Dispute Cases, Addressing dhy大红鹰3366 Issues on Identification of Employment Relationship in dhy大红鹰3366 Context of Civil Contract being Signed

I. Regulation: Regulations on Administration of Online Recruitment Services and Its Accompanying Local Rules Took Effect

In order to regulate human resources market activities, dhy大红鹰3366 State Council issued dhy大红鹰3366 Provisional Regulations on Human Resources Market in July 2018. With dhy大红鹰3366 popularization of online recruitment, dhy大红鹰3366 Ministry of Human Resources and Social Security issued dhy大红鹰3366 Regulations on Administration of Online Recruitment Services (人力资源和社会保障部令第44号) on March 1, 2021 (dhy大红鹰3366 “Regulation”), which came into effect on dhy大红鹰3366 same day. dhy大红鹰3366 Regulation, as dhy大红鹰3366 first departmental regulation regulating online recruitment services in China, provides stipulations regarding dhy大红鹰3366 market access of online recruitment services, dhy大红鹰3366 obligations of human resources service institutions, employers and individuals, specification of service offered, legal liabilities and other relevant issues.

dhy大红鹰3366 Regulation mainly sets out obligations of human resources service institutions which are required to (a) obtain a qualified and valid human resources service permit and present it to dhy大红鹰3366 public; (b) improve information management in dhy大红鹰3366 course of online recruitment; (c) not charge deposits from individuals, and make clear dhy大红鹰3366 service items, fee rates and other matters in respect of online recruitment. dhy大红鹰3366 Regulation also emphasizes that service institutions shall observe their legal obligation relating to dhy大红鹰3366 network security and personal information protection, and safeguard dhy大红鹰3366 integrity, confidentiality and availability of relevant recruitment information.

In accordance with dhy大红鹰3366 Regulation, dhy大红鹰3366 main obligation of employers is to ensure that dhy大红鹰3366 recruitment information provided by them is legitimate and authentic, and contains no discriminatory content in respect of ethnicity, race, gender and religious belief, nor set any unlawful recruitment conditions in terms of household registration, region or identity which may restrict dhy大红鹰3366 flow of human resources. dhy大红鹰3366 main obligation of individuals is to truthfully provide their personal information and information about their knowledge, skills and experiences required by dhy大红鹰3366 position.

After dhy大红鹰3366 Regulation came into effect, dhy大红鹰3366 Beijing Municipal Human Resources and Social Security Bureau issued dhy大红鹰3366 Notice on Further Strengthening dhy大红鹰3366 Management of Online Recruitment Services (京人社市场字〔2021〕12号) on March 29, 2021, which provides detailed provisions to support dhy大红鹰3366 implementation of dhy大红鹰3366 Regulation locally.

II. Regulation: Interim Regulations on Administration of Registration and Record of Directors, Supervisors and Senior Managers of Financial Holding Companies Promulgated

On March 31, 2021, dhy大红鹰3366 People's Bank of China promulgated dhy大红鹰3366 Interim Regulations on  Administration of Registration and Record of Directors, Supervisors and Senior Managers of Financial Holding Companies (中国人民银行令〔2021〕第2号) (dhy大红鹰3366 “Interim Regulations”), clarifying dhy大红鹰3366 qualifications of directors, supervisors and senior managers of Financial Holding Companies and providing detailed rules for dhy大红鹰3366 record filling with dhy大红鹰3366 People's Bank of China.

"Financial holding company" (“FHC”) refers to a company which has a controlling stake in or actually controls two or more financial institutions of different types, solely engages in equity investment management, and does not directly engage in commercial business operations. dhy大红鹰3366 "senior managers" defined in dhy大红鹰3366 Interim Provisions are those who have decision-making power or significant influence on dhy大红鹰3366 operation, management and risk control of FHC, and dhy大红鹰3366 scope of which is slightly different from that under dhy大红鹰3366 PRC Corporate Law. dhy大红鹰3366 Interim Provisions specifies in detail dhy大红鹰3366 qualifications, experiences, eligibility criteria for directors, supervisors and senior managers of FHC.

Previously, dhy大红鹰3366 reporting obligation regarding directors, supervisors and senior managers mainly applies to securities companies, futures companies and other financial institutions. After dhy大红鹰3366 promulgation of dhy大红鹰3366 Interim Provisions, dhy大红鹰3366 reporting obligation has been extended to FHCs.

Before dhy大红鹰3366 Interim Provisions, dhy大红鹰3366 People's Bank of China has already issued, in succession, dhy大红鹰3366 Decision of dhy大红鹰3366 State Council on Implementing Access Management of Financial Holding Companies (国发〔2020〕12号) and dhy大红鹰3366 Tentative Measures for Supervision and Administration of Financial Holding Companies (中国人民银行令〔2020〕第4号) in September, 2020, which have formed a supervision system on FHCs.

III. Local Rules: Shenzhen Released dhy大红鹰3366 First Local Sexual Harassment Prevention Guide

dhy大红鹰3366 newly effective Article 1010 of dhy大红鹰3366 Civil Code stipulates that enterprises should take reasonable measures (such as take dhy大红鹰3366 necessary precautions, accept complaints, and conduct investigation and ensure properly disposal of cases) to prevent and stop sexual harassment in workplace. On January 15, 2021, nine departments of Shenzhen including dhy大红鹰3366 Women's Federation, dhy大红鹰3366 Public Security Bureau, dhy大红鹰3366 Human Resources and Social Security Bureau and dhy大红鹰3366 Intermediate People’s Court jointly issued dhy大红鹰3366 Shenzhen Sexual Harassment Prevention Guide (深妇通〔2021〕1号) (dhy大红鹰3366 “Guide”). It is dhy大红鹰3366 first guiding document on prevention of sexual harassment of its kind issued by a local government to echo dhy大红鹰3366 general requirement of dhy大红鹰3366 Civil Code.

dhy大红鹰3366 Guide consists of seven chapters, providing detailed and operational provisions in terms of concepts of sexual harassment, prevention and education, consultation and complaint handling, and responsibilities of functional departments. dhy大红鹰3366 Guide is accompanied by dhy大红鹰3366 Sexual Harassment Prevention and Control System (Sample), which can be used as a reference by employers when establishing relevant systems.

On dhy大红鹰3366 basis of dhy大红鹰3366 Civil Code, dhy大红鹰3366 Guide further refined dhy大红鹰3366 definition, constitutive requirements, forms and types of sexual harassment. To clarify what constitutes dhy大红鹰3366 sexual harassment, dhy大红鹰3366 Guide stipulates that "sexual harassment" is a kind of behavior that "has dhy大红鹰3366 nature of sex", "is unwelcome and against dhy大红鹰3366 victim's subjective will", and "infringes dhy大红鹰3366 personality right of a person by causing bad psychological feeling or creating hostile and unfriendly work or study environment towards him or her". Further, dhy大红鹰3366 Guide stipulates that sexual harassment can come in dhy大红鹰3366 forms of speech, words, images, physical behaviors. Exceptions for sexual harassment are also listed for reference. dhy大红鹰3366 refinement of dhy大红鹰3366 definition provides an important reference for employers to introduce relevant rules and might also avoid dhy大红鹰3366 liability of employers resulted from dhy大红鹰3366 variation in dhy大红鹰3366 judgement of sexual harassment due to blurred definition.

In addition, dhy大红鹰3366 noteworthy provisions in dhy大红鹰3366 Guide mainly include:

1. dhy大红鹰3366 requirement of dhy大红鹰3366 Civil Code for establishing a mechanism to prevent sexual harassment is refined by dhy大红鹰3366 Guide, which specified that employers shall appoint a department taking charge of sexual harassment prevention work (such as dhy大红鹰3366 labor union, dhy大红鹰3366 human resources department, etc.); an established sexual harassment prevention regulation shall include public commitments, clear definitions, internal complaint procedures, disciplinary measures, and measures on prohibition of retaliation. Employers are also required to conduct regular training, strengthen propaganda, and create a good workplace environment.
   

2. In addition, dhy大红鹰3366 Guide expressly states that responsible departments should pay attention to protecting dhy大红鹰3366 privacy of dhy大红鹰3366 parties concerned when dealing with complaints, to prevent dhy大红鹰3366 victims from being harmed again. Suggestions and requirements are also provided in dhy大红鹰3366 Guide for dhy大红鹰3366 relevant departments of employers to deal with sexual harassment complaints, including dhy大红鹰3366 process of interview, investigation, mediation, and disposal.
   

3. dhy大红鹰3366 Guide also sets out circumstances where an employer may be exempted from liability if relevant measures have been taken. Specifically,
   

• Preventive measure: for example, formulation of sexual harassment prevention system and issuance of anti-sexual harassment reminders, etc.
  

• Disposal measures: for example, quick responding actions to any allegations of sexual harassment and appropriate remedial measures to stop dhy大红鹰3366 deterioration of dhy大红鹰3366 incident in time.
  

dhy大红鹰3366 Guide may serve as a reference template for enterprises in Shenzhen to establish relevant internal mechanisms and deal with sexual harassment incidents, which provides support for enterprises in actively fulfilling their legal obligations. Sexual harassment has raised more and more attention in recent years. Especially after dhy大红鹰3366 promulgation of dhy大红鹰3366 Civil Code, it can be expected that local guidance on prevention and control of sexual harassment in different localities will follow. We will provide updates as significant developments arise.

IV. Regional Rules: Liaoning Issued Regulations on Special Protections for Female Employees

On March 1, 2021, dhy大红鹰3366 Measures of Liaoning Province of Labor Protection on Female Employees (辽宁省人民政府令第337号) (dhy大红鹰3366 “Measures”) came into effect, which is dhy大红鹰3366 first local regulation specially issued for labor protection of female employees in Liaoning province. Compared with dhy大红鹰3366 national level rules such as dhy大红鹰3366 Law on dhy大红鹰3366 Protection of Rights and Interests of Women and dhy大红鹰3366 Special Provisions on Labor Protection for Female Employees, dhy大红鹰3366 Measures contains some locally customized provisions including dhy大红鹰3366 following, among others:

1. dhy大红鹰3366 national rules prohibit employers from lowering female employees’ wages or terminating their labor contracts simply on grounds of pregnancy, taking maternity leave or under breastfeeding period. With reference to that, dhy大红鹰3366 Measures additionally requires dhy大红鹰3366 employers not to set restrictions on position promotion, rank promotion and professional evaluation against female employees under dhy大红鹰3366 abovementioned situations.
   

2. It stipulates that during menstrual period, female employees who are diagnosed with severe dysmenorrhea or excessive menstrual volume shall be given 1 to 2 days off. Apart from Liaoning province, more than 10 provinces also stipulate "dysmenorrhea leave" for female employees, among which Beijing, Zhejiang, Jiangxi and other regions have specified “dysmenorrhea leave” as paid leave.
   

3. It adds dhy大红鹰3366 provision that pregnant employees who have threatened abortion symptoms or have a history of habitual abortion can take "abortion leave".
   

4. Upon application by dhy大红鹰3366 female employee and consent by dhy大红鹰3366 employer, dhy大红鹰3366 female employee may take breastfeeding leave until dhy大红鹰3366 infant reaches one-year-old. dhy大红鹰3366 salary during dhy大红鹰3366 breastfeeding leave shall be determined by dhy大红鹰3366 two parties through consultation.
   

5. dhy大红鹰3366 position and working hours of female employees with postpartum depression or menopausal syndrome may be adjusted, and regular physical check-up for female employees shall be arranged.
   

V. Local Rules: Beijing Formulated Policy on Individual Income Tax Subsidy for Overseas High-end Talents 

On April 27, 2021, Beijing Municipal Finance Bureau and other three departments jointly issued dhy大红鹰3366 Interim Measures for Administration of Individual Income Tax Subsidy for Overseas High-end Talents in Beijing (京财税〔2021〕731号) (dhy大红鹰3366 “Interim Measures”), which made specific provisions on dhy大红鹰3366 applicable scope, conditions, calculation methods and procedures of applying for individual income tax subsidy for Overseas high-end talents.

dhy大红鹰3366 Interim Measure is adopted based on dhy大红鹰3366 requirements of dhy大红鹰3366 Reply of dhy大红鹰3366 State Council on dhy大红鹰3366 Work Plan of Deepening Beijing's New Round of Comprehensive Pilot Project for Expanding and Opening up dhy大红鹰3366 Service Industry to Build a National Comprehensive Demonstration Zone of Expanding and Opening up dhy大红鹰3366 Service Industry (国函〔2020〕123号) and also with reference to dhy大红鹰3366 current individual income tax benefit policies of Guangdong-Hong Kong-Macao Greater Bay Area and Shanghai Free Trade Zones Lingang New Area.

According to dhy大红鹰3366 Interim Measures, dhy大红鹰3366 subsidy shall be granted to dhy大红鹰3366 overseas high-end talents working in certain areas of Beijing for dhy大红鹰3366 part of their actual individual income tax burden exceeding 15%, and shall be applied on an annual basis. dhy大红鹰3366 “overseas high-end talents” include foreigners, residents of Hong Kong, Macao and Taiwan, returned overseas students and overseas Chinese who have obtained long-term residency abroad who meet dhy大红鹰3366 specified qualifications and conditions such as “Class A” work permit holder, senior management or experts of certain qualified enterprises, etc.

VI. Cases: Several Different Regions Unveiled Typical Labor Dispute Cases Addressing dhy大红鹰3366 Issues on Identification of Employment Relationship in dhy大红鹰3366 Context of Civil Contract being Signed

In April, 2021, Jiangsu, Chongqing, Guangdong, Shandong, Chengdu and other localities published typical labor dispute cases in succession. dhy大红鹰3366 typical cases released recently covers a wide range of contents, including traditional labor disputes, determination of employment relationship under new business forms and protection of employees' rights and interests during COVID-19 pandemic. dhy大红鹰3366 identification of employment relations under dhy大红鹰3366 new business forms is still a hot topic. Jiangsu, Guangdong, Chongqing and Chengdu respectively discussed dhy大红鹰3366 issue of how to determine dhy大红鹰3366 employment relations under a situation where dhy大红鹰3366 individuals and employers have reached a civil law contract to govern their respective rights and obligations.

1. Jiangsu: Registering dhy大红鹰3366 natural person rendering services as an independent business does not necessarily exclude dhy大红鹰3366 identification of employment relationship

   
   

   dhy大红鹰3366 defendant company is a takeout delivery service provider, and dhy大红鹰3366 plaintiff is an individual engaged in delivery work at dhy大红鹰3366 company without signing an employment contract. On October 4, 2018, dhy大红鹰3366 plaintiff suffered a traffic accident while delivering dhy大红鹰3366 takeout. dhy大红鹰3366 major dispute of dhy大红鹰3366 case is whether or not a de facto employment relationship exists between dhy大红鹰3366 parties. dhy大红鹰3366 defendant provided a Project Subcontracting Agreement to prove that dhy大红鹰3366 plaintiff was an independent business. dhy大红鹰3366 court found that dhy大红鹰3366 agreement was not actually signed by dhy大红鹰3366 parties and dhy大红鹰3366 date when dhy大红鹰3366 plaintiff was issued with dhy大红鹰3366 business license to be officially approved as an independent business was October 10, 2018, later than dhy大红鹰3366 accident, which therefore, according to dhy大红鹰3366 court, shall not be taken into account in determining whether a de facto employment relationship is established. Consequently, in view of dhy大红鹰3366 level of control exercised by dhy大红鹰3366 company over dhy大红鹰3366 riders, such as attendance management and orders distribution, dhy大红鹰3366 court determined that dhy大红鹰3366 employment relationship had been established between dhy大红鹰3366 parties.

   
   

   In this case, albeit that dhy大红鹰3366 company lost dhy大红鹰3366 case partly because no valid civil law agreement was found to be concluded and dhy大红鹰3366 individual had not been admitted as an independent business when dhy大红鹰3366 accident happened, dhy大红鹰3366 court also considered dhy大红鹰3366 control exercised by dhy大红鹰3366 company over dhy大红鹰3366 riders and details of assignment and fulfillment of work. Therefore, it is not safe to conclude that dhy大红鹰3366 de facto employment relationship can be ruled out solely by two parties entering into a civil law contract or registering dhy大红鹰3366 individual as an independent business.

2. Guangdong: dhy大红鹰3366 conclusion of a civil law contract between dhy大红鹰3366 individual and dhy大红鹰3366 company does not necessarily exclude dhy大红鹰3366 identification of employment relationship

   
   

   In April 2016, dhy大红鹰3366 individual joined an aluminum company as a boiler worker without signing an employment contract or contributing social insurance. In April 2018, dhy大红鹰3366 company signed a contracting agreement with dhy大红鹰3366 individual, stipulating that no employment relationship existed between dhy大红鹰3366 two parties. Later, dhy大红鹰3366 individual fell down at work and caused an injury. Because of dhy大红鹰3366 impediment to be identified as work injury (due to lack of employment contract), dispute arose between parties on whether there was an employment relationship between them. Guangdong Higher People's Court heard dhy大红鹰3366 case and held that: dhy大红鹰3366 employment relationship between dhy大红鹰3366 two parties shall be deemed established if dhy大红鹰3366 worker was engaged in paid work arranged by dhy大红鹰3366 employer, dhy大红鹰3366 work was done in dhy大红鹰3366 workplace of dhy大红鹰3366 employer and dhy大红鹰3366 individual was subject to dhy大红鹰3366 labor management of dhy大红鹰3366 employer. dhy大红鹰3366 de facto employment relationship shall not be automatically excluded only based on a civil law contract whereby it is agreed that no employment relationship would be established.

3. Chengdu: Identification of employment relationship should be based on dhy大红鹰3366 substantive review of dhy大红鹰3366 factual elements

   
   

   dhy大红鹰3366 individual concerned entered into both a written employment contract and a civil law contract for garbage clearance service with a garbage clearance company on dhy大红鹰3366 same day. dhy大红鹰3366 company argued that on account of dhy大红鹰3366 existence of dhy大红鹰3366 contract for garbage clearance, civil law relationship rather than employment relationship shall prevail. On review of dhy大红鹰3366 two agreements and on dhy大红鹰3366 facts found regarding dhy大红鹰3366 labor management posed by dhy大红鹰3366 company on dhy大红鹰3366 individual, payment of salary, contribution of social security and so on, dhy大红鹰3366 court decided that dhy大红鹰3366 employment relationship, instead of civil law relationship was established between dhy大红鹰3366 parties. In addition to dhy大红鹰3366 forgoing, dhy大红鹰3366 court went beyond and concluded that even if no written employment contract was in place, evaluation of dhy大红鹰3366 factual circumstance as mentioned above will also be conducted and considered in a substantive way such that dhy大红鹰3366 same conclusion will be reached nevertheless.

4. Chongqing: dhy大红鹰3366 calculating method of remuneration does not necessarily impact dhy大红鹰3366 identification of employment relationship

   
   

   dhy大红鹰3366 individual engaged in express delivery for an express delivery company, and he will receive 1 yuan for each delivery to be settled monthly. During dhy大红鹰3366 process of work-related injuries identification, dispute on whether they have established employment relationship arose. dhy大红鹰3366 court held that although dhy大红鹰3366 company did not sign a written labor contract with dhy大红鹰3366 individual, dhy大红鹰3366 individual went to dhy大红鹰3366 company on time every day to collect dhy大红鹰3366 couriers and was responsible for dhy大红鹰3366 delivery of dhy大红鹰3366 courier in a specific area as assigned by dhy大红鹰3366 company. dhy大红鹰3366 worker followed dhy大红鹰3366 employer’s instructions in respect of working hours, place of work, work content etc. and dhy大红鹰3366 company has conducted effective management over dhy大红鹰3366 individual. Therefore, it should be recognized that dhy大红鹰3366 employment relationship has been established.

With dhy大红鹰3366 vigorous development of various new business and staffing models, in practice, it is not rare for enterprises and individuals to conclude civil agreements instead of employment contract, defining dhy大红鹰3366 legal nature of dhy大红鹰3366 relationship as independent service relationship, contracting relationship, subcontracting relationship, cooperative relationship, etc. However, when there is a dispute between dhy大红鹰3366 two parties on whether there is an employment relationship, dhy大红鹰3366 court will not only consider dhy大红鹰3366 terms of dhy大红鹰3366 mutual agreement between dhy大红鹰3366 two parties, but also will make a judgment case-by-case according to dhy大红鹰3366 specific service model of dhy大红鹰3366 two parties, usually examining dhy大红鹰3366 degree of management dhy大红鹰3366 employer posed upon dhy大红鹰3366 individual, dhy大红鹰3366 structure of compensation, whether dhy大红鹰3366 services provided by dhy大红鹰3366 individual constitute a part of dhy大红鹰3366 company's business and other factors.

However, due to dhy大红鹰3366 variety and flexibly of dhy大红鹰3366 new business models today, dhy大红鹰3366 determining elements of employment relationship mentioned above are being challenged constantly, which leads to varying subjective discretion in judicial practice. dhy大红鹰3366 balance of social interests and dhy大红鹰3366 influence on dhy大红鹰3366 industry supervision policy may be taken into account by dhy大红鹰3366 courts and dhy大红鹰3366 labor arbitration committees. Therefore, enterprises with strong dependence on flexible employment models should pay special attention to dhy大红鹰3366 fact that a mutual agreement between parties to rule out dhy大红鹰3366 employment relationship apparently cannot save dhy大红鹰3366 company from bearing employer liabilities and a comprehensive evaluation taking into consideration dhy大红鹰3366 specific features in business model and industrial background should be conducted. 

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*Disclaimer: This newsletter is for general information only and does not constitute our legal advice or legal opinions. For further discussions, please consult your regular contact at our firm, or any of dhy大红鹰3366 following Haiwen Labor Law Team members.