Coronavirus and China Employee Management

As workers in some locales in China head back to work after the end of extended time off period (some ended on February 3), one hashtag #eat in cafeteria, feels like exams# gained a lot of traction. It started with a picture showing workers were separate from each other while eating in company cafeterias. Though every company does it a little differently, the common theme is to allow only one person per table and two people must be at least two to three meters apart to avoid close contact. So basically like separate seating when taking exams. Many are reacting to this hashtag.

This is kind of a long way of saying that China is truly different from any other jurisdictions in terms of its different systems, cultures and expectations. It means even for multinationals that want to take one universal approach in all jurisdictions they operate, when managing China employment affairs and pretty much everything else, you need to keep in mind the practices and realities in your specific locales in China. We have been keeping getting tons of questions from employers and employees regarding what their rights, obligations and options are during the coronavirus epidemic. Given there is so much uncertainty right now and we cannot predict when the current state will end, our advice is to watch for the developments and stay in compliance to the best you can. For example, Beijing is sort of business as usual in that employees are now back to work, though many are working remotely as the government has encouraged them to do so at least before February 10. But what happens after February 9? Will the government continue to encourage employers to have employees work at home to avoid crowd gathering? This is likely but we just don’t know now. The mandatory rest period is still in place in Shanghai through February 9 and what happens after that? We don’t know.

Just a few days ago after the PRC State Council extend the Chinese New Year through February 2, some city officials in Nantong city were inspecting a textile mill and they saw three workers working there. This was a flat-out violation of the Jiangsu provincial government mandated extended holiday and so they reported this to the local police. It turned out the workers were asked by their employer to complete unfinished orders placed before the Chinese New Year. And the person-in-charge of the mill was arrested and then sentenced to be detained for 5 days for failing to comply with the government order. So be careful. If you are in a city where the employers are required to close their businesses now, comply.

You as China employer need to do your best to be legally compliant. Make sure you have someone on the ground who is keeping up with the local requirements, as well as the measures favorable to employers that are coming out to address employer concerns and ease employer burdens such as extensions of deadlines for social premium payments, delayed raises on social insurance bases and government-provided subsidies for maintaining workforce stable. Because the new rules are being rushed out, the level of details is not great and therefore it is advisable to seek clarifications from the local authorities (to the extent possible). However, the authorities did not just invent new rules out of the blue, instead, they relied on existing rules so it is important to check the rules and practices that were effective prior to the outbreak as well (to the extent they exist) to better navigate the issues at hand. Also, the intent and spirit of the laws should not be forgotten, and that is employee protectionism—which has been in force in China for a long time.

Now, more than ever, is not the time to apply an approach or take an action which may be considered okay in your home country but not proper for your specific locale in China. For example, we are still getting questions about how the employer can do about laying off employees now and our answer is a consistent no, at least right now, don’t do it. The bottom line is as China employer you need to do right by your business and your employees all under the confines of Chinese law.