CLB urges the Chinese government to further restrict the use employment agency labour

22 August 2012

One of primary aims of the Labour Contract Law, which went into effect in 2008, was to ensure that every worker could sign an employment contract with their employer. What actually happened was that tens of millions of workers ended up having to sign contracts with employment agencies (劳务派遣公司) rather than their actual employer, thereby being denied the legal protections, remuneration and social insurance benefits of regular employees.

The abuse of the employment agency system (which is only supposed to supply businesses with temporary, auxiliary and substitute labour) is now so endemic in China that the government in Beijing has been forced to take action to tighten the loopholes in the current law.

The National People’s Congress (NPC) Standing Committee has drafted a series of amendments to the Labour Contract Law that it hopes will ensure all China’s employees can enjoy equal pay for equal work.  China Labour Bulletin believes the proposed amendments are a good start but that much more needs to and can be done to really clamp down on employer abuses of the system. Thus, in response to the NPC Standing Committee’s call for public comment on the draft amendments, CLB has made a detailed submission to the government (translated in full here).

The main points of the submission are:

  • Enhance and strengthen the ability of the local authorities to regulate and supervise the use of agency labour.
  • Provide a role for the trade unions in ensuring that both employers and employment agencies comply with the law.
  • Limit the number of agency workers any one enterprise can employ.
  • Ensure that all social insurance benefits are paid in full.
  • Prevent employers from using agency workers on a long-term basis.
  • Prevent employers from using agency workers to replace striking workers.
  • Prevent employers from setting up their own employment agency or changing the status of current employees into agency employees.
  • Place restrictions on the types of industry and jobs that can legitimately use agency labour.

In the final analysis, however, CLB suggests the best long-term solution to the myriad problems currently evident in the employment agency system would be for the legislature to draft a new dedicated law specifically on the regulation of employment agencies and the use of agency labour in China.

The full translation of CLB’s submission to the NPC Standing Committee, Amendments to the Labour Contract Law of the People’s Republic of China (Draft): Comments and Recommendations, is available as a downloadable PDF. The Chinese language original 对《中华人民共和国劳动合同法修正案 (草案)》的意见和修改建议can be found on our Chinese website.

Note on translation. The term “劳务派遣” is often translated literally as “labour dispatch.” CLB translates it as “agency labour” because this more clearly expresses the nature the problem to an English speaking audience.

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