The Labour Contract Law contains specific provisions on the economic compensation to be paid to employees for contract termination based on the number of years they have been employed at the company. And since its promulgation in 2007, employers have deliberately sought to circumvent these provisions by forcing long-serving employees to sign new short-term contracts or reassigning them as dispatch workers. Indeed, attempts by management to alter contracts or cheat workers out of their legally entitled compensation has been one of the most common causes of labour disputes in China over the last two years. See. Going it Alone: The Workers’ Movement in China (2007-2008)
In March 2009, CLB Director Han Dongfang talked to hotel worker Zhu Peifang, who was summarily dismissed just before the Chinese New Year after 24 years of service, and a personal investment of 3,000 yuan, in Shanghai’s Baolong Hotel. She received no compensation, no year-end bonus and no wages for her work the previous December. Four months after the interview, with the help of CLB, Zhu was reinstated and paid six month’s wages in arrears.
Zhu was one of several long-standing employees dismissed after the hotel upgraded to a five star establishment and brought in a foreign-funded management company. She described how the hotel’s human resources department tried to trick her into signing a new three year contract, claiming her existing contract which was valid for another six years had been lost. When she refused to sign she was fired and barred from reentering the hotel.
Zhu, along with about one hundred other employees, starting working at the hotel in 1985, after she had invested 3,000 yuan in the project - a substantial sum of money for an individual worker at the time. In 1995, the hotel introduced an employment contract system, and Zhu signed a 20 year contract, effective until 2015. Zhu thought that contract guaranteed her job. However on 7 November 2008 she got a call from the human resources department.
Let me tell you what happened on that day. The human resources department called and asked me to go in. I went that very day, and asked what the matter was. Ms. Lu of the human resources department told me that my contract had been lost, and that I would have to sign a new one. I asked how the contract could be lost, because all our contracts were bundled together, we all signed the contract when the new contract system came into effect in 1995, how could my copy be lost? It was not possible, I said. Isn’t that true? If it’s lost, then the file would be lost. If it’s not lost, then it will all be together, why would they lose only my copy? It doesn't make any sense at all.
Zhu refused to sign the new contract:
I said, ‘I have a legally binding contract with you until the year 2015, now you are telling me to sign a new one for three years. Moreover, I have worked at this hotel for 24 years, and you are asking me to sign for three years? You are definitely in the wrong. It’s a violation of my labour rights.’ At that time, the hotel’s assistant general manager and human resources manager were there. I told them; ‘This cannot happen, if you lose one contract, then you lose all contracts. Then you say that you want me to sign for three years, this is wrong, I won’t sign it.’
The assistant general manager suggested that Zhu should try to find her copy of the contract and the matter was set aside for the time being. “At that time,” Zhu explained, “They were trying to test me, to find out if I still had my copy of the contract. That was their real intention… If I had no proof, they could terminate my position. That was the real motive behind their actions.”
Zhu continued to go work as normal until 4 January when the hotel security guards refused to let her enter the hotel:
I was dumbfounded, and asked why I was not allowed to start my shift. They said the human resources department had instructed them not to let me in. I ignored them, anyway, and after I went in, the security guards immediately informed the security manager and the human resources manager. They came to the front entrance. I said they can't stop me from going to work, and I ignored them too, and made my way in. I pushed my way in, and went to the changing room, and got ready, and was about to go to my station when I saw that there were two notices on the board, one for me and one for my colleague, Chen Huijuan. It was to terminate my employment.
After being summarily dismissed and barred from the hotel she had worked at for 24 years, Zhu and her colleague received no compensation or even the wages they were owed. “We didn't get anything. We worked until 4th January, and were chased out of the hotel. We didn't get the year-end bonus for 2008. And we didn’t get the wages for December 2008 either. We didn’t get anything. Because we get our wages after we have worked. We get 1,900 yuan a month, 1,500 yuan after tax. The year-end bonus our colleagues received was 1,200 yuan.”
Faced with such a blatant violation of her rights, Zhu went to the hotel’s trade union chairman for help.
I told him that this situation was not acceptable to me. I must uphold my principles. I did not breach the hotel’s rules and regulations, I have not made any mistakes, and I want to go to work. He was very sympathetic. He said, ‘We will speak to the boss.’ But whatever he said was useless, the boss ignored him completely, and bypassed the union altogether. The chairman was disregarded. Now our union chairman, he’s also the department store manager, has been barred from the morning management meeting, they have now removed his seat. What more can he possibly say? The hotel has completely disregarded the union.
After the hotel union had been ignored, Zhu and her colleague tried the municipal federation of trade unions but the officials there told them to go the state capital commission instead.
Actually, that’s how it is over here, including the municipal labour protection bureau that we went to, we also went to the municipal labour inspection team, we went to quite a few places actually, and they all moved us to some other place. We also wrote quite a few letters to the Baoshan district head, to the Baoshan People’s Congress. They simply forwarded our letters to the labour protection bureau of Baoshan district, which wrote us a reply, telling us to apply for arbitration.
Applying for arbitration
Zhu told Han that she was reluctant to go arbitration because she did not have sufficient documentation. However, she later admitted that she had found her copy of her original employment contract. Han told her:
If you have it, take it along with you to apply for arbitration. That’s written proof. Moreover, for the past twenty years, even if you don’t have wage slips for all the months, surely you would have kept some slips. Maybe you do, maybe you don't, and that’s not a problem. You have worked there for twenty years, so there must be some witnesses, some evidence, that's a fact. Take whatever you can to apply for arbitration. After applying, if they tell you some things are missing, you find them later. You had assumed that you don’t have enough evidence, so you forwent arbitration. That doesn’t make any sense.
Han went on to explain moreover that she should apply for arbitration as soon as possible.
You must be mentally prepared for it. Labour arbitration, is time-sensitive, with a deadline. Don’t wait until it’s past the appeal deadline. From what I understand, even though it’s obviously an unreasonable situation, and the employer is obviously violating the law, once you are past the legal arbitration time-limit, the case won’t be considered. Then it will be harder to file a lawsuit. I'm not saying that it can’t be done, only that it will be a lot harder. I think labour arbitration should be brought in as early as possible, it’s better to be early than late. Also, if you lose in the arbitration process, you can still lodge a lawsuit at the courts.
After the interview, Zhu did eventually accept Han’s advice and, with the help of lawyers provided by CLB, filed for arbitration.
In July, after being threatened with a lawsuit, hotel management not only agreed to reinstate Zhu and her colleague, but also agreed to pay her six month’s wages and social insurance contributions in arrears. Around the same time, the Chinese partner in the hotel reportedly bought out the foreign-funded management company, leading to the departure from the hotel of those managers involved in Zhu’s case.
Han Dongfang’s interview with Zhu Peifang was broadcast in four episodes in March 2009. To read the full Chinese transcript or listen to the audio file of the broadcast please go to the workers’ voices section of our Chinese language website and follow the links.