Question 6: Since quarantine period occupied half of probationary period, can we extend probationary period or terminate labor relation?

Answer: The enterprise shall not terminate the labor relation directly.

Nuo Di’s comment: The enterprise may negotiate with the employee to change the probationary period in the statutory maximum limit in order to achieve the purpose of probation inspection, but it cannot directly terminate the labor relationship on this grounds, otherwise it is illegal.

～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～

Question 7: In the light of this epidemic outbreak, the shutdowns have affected businesses too much. Can companies use it as an excuse to lay off workers?

Answer: It is not recommended that enterprises in this case directly terminate the labor contract for layoffs.

Nuo Di’s comment: According to the Notice of General Office of Human Resources and Social Security Ministry about properly handle labor relations during novel coronavirus infection pneumonia epidemic prevention and control period, If the enterprise has difficulties in production and operation due to the impact of the epidemic, it may, through consultation with the staff and workers, adopt such measures as salary adjustment, rotation of posts and holidays, and shortening of working hours to stabilize the job position, and try not to lay off employees or lay off employees as less as possible. The eligible enterprises may enjoy the stable post subsidy according to regulations (the standard of stable post subsidy varies from place to place, please consult local HR & Social Security Bureau).

～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～

Question 8: Affected by the outbreak, how does the enterprise deal with production and management difficulties?

Answer: For enterprise undergoing production and management difficulties caused by the epidemic, it may, through consultation with the staff and workers, adopt such measures as salary adjustment, rotation of posts and days off, shortening of working hours, and awaiting job assignment to stabilize the job position, and try not to lay off employees or lay off employees as less as possible. The eligible enterprises may enjoy the stable post subsidy according to regulations. Please refer to Notice of General Office of Human Resources and Social Security Ministry about properly handle labor relations during novel coronavirus infection pneumonia epidemic prevention and control period

For enterprises that have stopped production or business due to the epidemic, they may, in accordance with the spirit of the Notice on Maintaining the Stability of Labor Relations during the Prevention and Control of the Epidemic, reach a consensus through consultation with the employees and arrange them for waiting for job assignment. During the waiting period, the enterprise shall pay the basic living expenses at least 70% of the minimum salary standard of this municipality.

If the consultation with the staff fails, the enterprise can also directly adjust the payment and welfare in accordance with the corresponding local policies.

Nuo Di’s comment: It is recommended for enterprises, which have stopped production or business due to the epidemic, to adjust the payment according to following steps.

1. Salary shall be paid to laborers as usual within the first payment cycle after suspension of production or business;

2. After the first payment cycle, the salary shall be paid based on the work volume provided by the laborer according to the standard agreed by both parties, which shall be also not less than the minimum salary standard of the municipality.

3. After the first payment cycle, if the enterprise does not assign any task to the laborer, the basic living expenses of laborers shall be paid at least 70% of the minimum salary standard of this municipality.

To sum up, enterprises can adjust employee payments appropriately according to their own conditions, so as to reduce the cost of labor. Certainly, if an enterprise set up a scientific remuneration system based on work volume, it can also achieve the purpose of controlling the labor cost directly by stopping the payment of performance remuneration and performance reward.

～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～

Question 9: Because of this epidemic, the production and operation of the enterprise undergoes serious difficulties and it really needs to lay off staff, how to proceed?

Answer: This is "economic layoff ", which refers to the situation in which the employers dismiss some laborers at one time due to poor management and other reasons. It is that the employer unilaterally terminates the labor contract, so the employer should pay laborer economic compensation. In accordance with Article 41 of the Labor Contract Law, when serious difficulties occur in the production and operation of an enterprise, it is necessary to reduce the number of employees by more than 20 or by less than 20 but accounting for more than 10 percent of the total number of employees of the enterprise; the layoff process can be done according to the following procedures:

● The enterprise shall explain the situation to the trade union or all the staff 30 days in advance and formulate a plan;

● Fully listen to the opinions of the trade union or workers, adjust the plan;

● Report the plan to the labor administrative department;

● Pay economic compensation to employees in accordance with the law.

Nuo Di’s comment: If, after the end of the epidemic, the enterprise's business conditions have been improved and it needs to recruit new staff, it shall give priority to the persons under the same condition who have been laid off.

If the enterprise just needs to lay off several staff or small number of staff, it can also be in accordance with the provisions of Article 36 of the Labor Contract Law, negotiate with employees to terminate the labor contract, and sign a written agreement accordingly.

～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～～

Address: 32/F, Federation of Industry Building, No.55 East Yan’an Road, Shanghai, China

Tel: 02153085022    Fax: 02153082933   Website: http://www.shndlaw.com