Relevant Legislation
Lao Dong Fa [Labour Law of the People’s Republic of China]
(Promulgated by the NPC Standing Committee, effective January 1, 1995), 1994 FAGUI HUIBIAN 91, 94 (Official Source)3
Labour Act (5 July 1994)4
Provisions on Collective Contract (2004)5
Law of the PRC on Employment Contracts (2008)6
Content
Article 33 of the Labour Law provides that ‘the employees of an enterprise as one party may conclude a collective contract with the enterprise as another part on labour remunerations, work hours, rests [sic] and leaves [sic], labour safety and sanitation, insurance welfare treatment, and other matters’. [See also Article 3 of the Provisions on Collective Contract]. Section 33 of the Labour Act also adds that Occupational Health and Safety may form part of the collective agreement.
Article 51 of the Law on Employment Contracts stipulates:
After bargaining on an equal basis, enterprise employees, as one party, and their Employer may conclude a collective contract on such matters as labor compensation, working hours, rest, leave, work safety and hygiene, insurance, benefits, etc.
Interaction with National Legislation and Individual Contractual Agreements
Section 35 of the Labour Act [as well as Article 6 of the Collective Contract Provisions] stipulates that:
Collective contracts concluded in accordance with the law shall have binding force to both the enterprise and all of its staff and workers. The standards on working conditions and labour payments agreed upon in labour contracts concluded between individual laborers and the enterprise shall not be lower than those as stipulated in collective contracts.
Article 5 of the Collective Contract Provisions highlights that regulations and rules of relevant State provisions must be followed when conducting collective consultation.
Negotiation and Signing of Collective Agreements
Article 51 of the Law on Employment Contracts stipulates:
The draft of the collective contract shall be presented to the employee representative congress or all the employees for discussion and approval. A collective contract shall be concluded by the labour union, on behalf of the enterprise’s employees, and the Employer. If the Employer does not yet have a labour union, it shall conclude the collective contract with a representative put forward by the workers under the guidance of the labour union at the next higher level.
Article 33 of the Labour Law specifies that the draft collective agreement:
[…] shall be submitted to the workers’ representative assembly or all the employees for discussion and passage. Collective contracts shall be signed by and between the trade union on behalf of the employees and the employer. In an enterprise that has not yet set up a trade union, such contracts shall be signed by and between representatives recommended by workers and the enterprise.
This is supported by Section 33 of the Labour Act, and Article 37 of the Collective Contract Provisions, which states:
After a draft collective contract or special collective contract has been adopted by the employees’ representative meeting or the employees’ meeting it shall be signed by the chief representatives of both parties in collective consultation.
Furthermore, Article 5(2) - (5) of the Collective Contract Provisions outlines the principles that must be followed during the negotiation of collective bargaining agreements:
1) mutual respect and consultation on an equal level basis
2) act in good faith and cooperate on the basis of fairness
3) the lawful rights and interests of both parties shall be taken into account; and
4) no extreme action shall be taken.
Implementation and Conclusion of Collective Agreement
Section 33 of the Chinese Labour Act provides:
A collective contract shall be concluded by the trade union on behalf of the staff and workers with the enterprise; in enterprise where the trade union has not yet been set up, such contract shall be also concluded by the representatives elected by the staff and workers with the enterprise.
Section 34 provides for the entry into force of the collective agreement:
A collective contract shall be submitted to the labour administration department after its conclusion. The collective contract shall go into effect automatically if no objections are raised by the labour administration department within 15 days from the date of the receipt of a copy of the contract.
Article 38 of the Collective Contract Provisions stipulates:
The term of a collective contract or special collective contract shall be one to three years in general and shall immediately be terminated when the term expires or when the conditions for termination agreed upon by both parties arise.
Within three months prior to the expiration of the term of the collective contract or special collective contract either party may request to the other party for a renewed conclusion or extension.
Endnotes
3 Lao Dong Fa [Labour Law of the People’s Republic of China], 1/01/1995, available at http://www.usmra.com/china/Labour%20Law.htm (accessed 16/05/11).
4 Labour Act, 5/07/1994, available at http://www.ilo.org/dyn/natlex/docs/WEBTEXT/37357/64926/E94CHN01.htm (accessed 16/05/11).
5 People’s Republic of China, Collective Contract Provisions, 2004, available at http://www. asianlii.org/cn/legis/cen/laws/pocc373/ (accessed 19/10/2011).
6 Law of the PRC on Employment Contracts, 2008, unofficial translation prepared by Baker & McKenzie, available at http://www.china-europa-forum.net/bdfdoc-138_en.html (accessed 8/06/11).
