2013 China-Africa Conference Report 2-China’ Policy and Experience for Employment of Farmers

                                                            Preface

1. The Idea of the Employment Policy for Farmers

The employment policy refers to a series of systems, laws and regulations, and measures made by a nation’s government to guide, manage and standardize rural labor’s employment in light of its political and economic systems, the supply and demand of rural labor, social and economic development goals. With the largest population in the world, the huge employment pressure has been a major challenge faced by the government of China. Harmonious new countryside would be a castle in the air without rural labor’s full employment. To promote rural labor’s employment is the top concern for farmers as well as a promise the Chinese government has to fulfill. Only when we fully recognize the importance and seriousness of this issue, and make good arrangement for both the farmers who stay in rural areas and the farmers who go out as migrant workers, can we really resolve the three rural issues concerning agriculture, countryside and farmers which have troubled China for thousands of years, can we successfully fulfill the strategic goals of building a new countryside, that are to benefit farmers, to develop urban and rural areas in a balanced way and to build a new socialist countryside.

The Review of China’s Policy for Promoting Farmers’ Employment

The Formative Stage of Urban-Rural Dual Employment System (1949-1983). In the early years of the new China, farmers were allowed to freely work in cities. Due to the urban areas’ pressures made by a large number of migrant workers, the government began imposing restrictions on urban enterprises’ recruiting migrant workers in the late 1950s. From 1978 to 1983, China implemented employment policies of "leaving the land but remaining in rural areas" and "working in factories but not going into cities" for farmers.

The Loose Stage of the Urban-Rural Division Employment System (1984-1991). China approved the revocation of people’s communes in 1983, which created prerequisites for rural labor to transfer to non-agricultural industries and cities, and started the shift in the flow policy for farmers from rigid control to loose permission.

The Initial Stage of the Balanced Urban-Rural Employment System (1992-2002).

Farmers’ trans-regional flow was increasingly active, and gradually becoming a major form for rural labor to transfer to non-agricultural industries.

The government’s employment policy for farmers changed gradually from permitting farmers’ flow to encouraging farmers’ mobile employment.

The Exploratory Stage of the System for Balanced Urban-Rural Employment (2002-now).The government emphasizes to offer fair employment opportunities for farmers, encourages farmers to engage in agriculture by grain subsidies and other measures, supports agricultural industrialization, and encourages farmers to engage in non-agricultural industries in multi-channels.

2. The General Survey of Farmers’ Employment in China

(1) The Rural Employees and Structure in China

a. The Rural Population

China is a vast agricultural country with the rural population accounting for a large proportion in the total population. Since 1978, China’s rural population has changed dramatically with new traits.        therural population (ten thousand persons)        the proportion of rural population

Data Resource: China Statistical Yearbook 2012, Statistical Communiqué of the People’s Republic of China on the 2012 National Economic and Social Development.

Chart 1 the Rural Population and Proportion

In Chart 1, it is observed that the change in the rural population in China can be divided into two stages as a whole from 1978 to 2012: in the first stage, the number of rural population has been growing year by year from 1978 to 1995, apart from a decrease of 0.49% in 1984, growing from 790.14 million to 859.47 million, growing by 69.33 million, at a growth rate of 8.77%; in the second stage, from 1996 to 2012, since the rural population in China reached its peak in 1995, it has declined year by year to 642.22 million in 2012, falling by 217.25 million, at a falling rate of 25.28%.

The proportion of the rural population to the total population of China has shown a declining trend from 1978 to 2012, declining from 82.08% to 47.4%.It has reflected that since reform and opening-up, the rural population has transferred gradually to cities in the fast urbanization.

b. The Number of Rural Employees

    the rural employees (ten thousand persons)           the growth rate

Data Source: Sixty Years’ Agricultural Statistical Data of New China, China Statistical Yearbook 2010-2012, Statistical Communiqué of the People’s Republic of China on the 2012 National Economic and Social Development

Chart 2 The Rural Employees and Growth Rate

 

In Chart 2, it is observed that the number of rural employees in China has shown a growing trend from 1978 to 2003, growing from 306.38 million to 543.852 million, growing by 237.472 million, at a growth rate of 77.5%, at an average annual growth rate of 1.70%.

From 1978 to 2012, the gender ratio of  the rural employees in China has maintained basically stable, fluctuating around 54% to 46% with slight decline, with the male ratio declining from 54.01% to 53.58%.

In Chart 3, it is observed that the industry distribution of rural employees in China has changed dramatically from 1978 to 2008.

The proportion of employees engaged in agriculture, forestry, animal husbandry and fishing has decreased substantially, from a ratio of 92.88% to the total employees to 54.52%; while the proportion of employees engaged in industry has risen substantially, from 2.87% to 14.84%; and the proportion of employees engaged in construction industry has also risen substantially, from 0.87% to 8.55%; the proportion of employees engaged in transportation, warehousing, post and telecommunication industries has also risen, from 0.27% to 3.11%; the proportion of employees engaged in wholesale and retail, trade and catering industries has risen from 0.79% to 7.30%; and the proportion of employees engaged in other industries has risen from 2.32% to 11.67%.

(2) The Number and Structure of Rural Migrant Labor in China.

a.The Permanent Population and Labor Force per Household in Rural Areas

The permanent population, full and semi-able-bodied labor force per household and growth rate shown in the Chart 1:  

the permanent population (persons)     the full and semi-able-bodied labor force (persons)

the growth rate of permanent population       the growth rate of full and semi-able-bodied labor force

Data Source: 1998-2012China Rural Statistical Yearbook

Chart 4 The Permanent Population, Full and Semi-able-bodied Labor Force per Household and Growth Rate

 

In Chart 4, it is observed that, from 1997 to 2011, the rural average permanent population per household in China has fallen from 4.33 persons to 3.9 persons, falling by 0.43 person, at a falling rate of 9.93%, at an annual decrease of 0.75%; while the rural average full and semi-able-bodied labor force per household fluctuates around 2.8 persons within a narrow range.

b. The Number of Migrant Labor Force in Rural Areas

The migrant labor force and its growth rate shown in Chart 2:

themigrant labor force (ten thousand persons)         the growth rate

Data Source: 1998-2012 China Rural Statistical Yearbook, 2009-2012 Nationwide Rural Migrant Workers Monitoring Survey Report.

Chart 5 the Number of Migrant Labor Force and Its Growth Rate in Rural Areas

In Chart 5, it is observed that the number of rural migrant labor force in China has grown from 83.145 million to 163.36 million from 1997 to 2012, growing by 80.215 million, at a growth rate of 96.48%, at an average annual growth rate of 4.61%.

c. The Structure of Rural Migrant Labor Force

From 2003 to 2012, while the number of rural migrant labor force has substantially risen, the structure of rural migrant labor has also shown some new characteristics with changes in different indicators, including gender, age and educational level.

From 1997 to 2012, there are more male workers in China migrant labor force. And the gender ratio has generally maintained stable with the male ratio and female ratio respectively fluctuating around 2/3 and 1/3.

From 1997 to 2012, the average age of China migrant labor force has increased from 25.34 years old to 37.3 years old, rising by 11.96 years old. The average age of each year has risen year by year apart from a slight decline in 2004, which has reflected the current population in China.

At the same time, the average years of schooling of China migrant labor force has risen from 7.79 years in 1997 to 8.4 years in 2012, rising by 0.61 year. It has reflected that the educational level of China migrant labor force has been promoted to some extent, and the quality of labor force has been improved.

industry construction industry   transportation business and service industry other industries

Data Source: 1998-2012 China Rural Statistical Yearbook, 2009-2012 Nationwide Rural Migrant Workers Monitoring Survey Report.

Chart 6 the Industry Distribution of Rural Migrant Labor Force in China

In Chart 6, it is observed that the industry distribution of rural migrant labor force has also shown new characteristics: in the migrant labor force, the proportion of workers engaged in industry has declined from 27.53% to 22.2%; the proportion of workers engaged in construction industry has slightly increased from 15.15% to 18.4%; the proportion of workers engaged in transportation has remained relatively stable with a slight increase from 6.35% to 6.6%; the proportion of workers engaged in business and service industry has slightly decreased from 21.16% to 19.76%; and the proportion of workers engaged in other industries has increased from 29.81% to 33.0

Data Source: 1998-2012 China Rural Statistical Yearbook, 2009-2012 Nationwide Rural Migrant Workers Monitoring Survey Report.

Chart 7 the Monthly Average Income and Its Growth Rate of the Rural Migrant Labor Force in China

In Chart 7, it is observed that the annual average income of rural migrant labor force in China has grown from 418.29 yuan to 2290 yuan from 1997 to 2012, growing by 1817.71 yuan, at a growth rate of 447.47%, at an average annual growth rate of 12.01%.

Column 1 the Major Employment Models for Farmers in China

· The Local Employment for Farmers:

aquaculture, agricultural and non-agricultural Industry; agricultural and non-agricultural service industry.

· The Transfer of Employment for Farmers:

the Transfer of Employment Within Agriculture; the Transfer of Employment in Non-Agricultural Sector; the Region Transfer of Employment; the Urban-Rural Transfer of Employment.

I. The Policies and Regulations for Promoting

Employment of Farmers

1. Law of the People’s Republic of China on Promotion of Employment

Law of the People’s Republic of China on Promotion of Employment has been formulated in August, 2007 in order to establish a long-term mechanism for promotion of employment, to coordinate economic development with employment increase, and to promote harmony and stability of society. Before the Law, there was no special legislation on promotion of employment, just some relevant provisions made by the government.

(1) The Basic Idea of the Legislation

Law of the People’s Republic of China on Promotion of Employment is an important law to build the socialist harmonious society: it fully reflects the guidelines and policies of the Party and State on promotion of employment, and institutionalizes them to establish a long-term mechanism for promotion of employment; it emphasizes to resolve the prominent problems in promotion of employment; it properly handles the relationship between the central and local governments in promotion of employment; and it properly handle the relationship between this law and other relevant laws.

(2) The Principles, Guidelines and Mechanism for Promotion of Employment

The State shall achieve positive interaction between economic development and employment increase to realize harmony and stability of society; the State Council shall establish a coordination mechanism to research the prominent problems in employment and coordinate nationwide promotion of employment; trade unions, Communist youth leagues, women’s federations, disabled persons’ federations and other public organizations shall assist the people’s governments in carrying out the promotion of employment and, in accordance with law, protect the workers’ right to work.

(3) The Establishment of Policy Support System

The State implements industrial policies, policies of economy and trade, investment policies, fiscal and tax policies, credit policies and other policies which are favorable for the promotion of employment; the State applies employment policies to make overall plans for urban, rural and regional areas, establishes a sound system under which to provide equal job opportunities to both urban and rural people, gives guidance to agricultural workers in their effort to find other jobs in an orderly manner, and encourages cooperation between different regions; people’s governments at all levels shall make overall plans for the employment of the new-arising workforce in cities and towns, of the surplus agricultural workers in other jobs, and for the re-employment of the unemployed; the State shall encourage all sectors of society to carry out activities, such as entrepreneurship training and employment service to promote the employment ability and entrepreneurial ability of various employment groups, including women, the disabled, graduates from colleges, universities and vocational schools, veterans and others, in accordance with their respective characteristics.

(4) The Specification of Market Order

Local people’s governments at or above the county level shall foster and improve a unitary, open, competitive and orderly market for human resources to provide services to the workers for employment; when an employing unit recruits persons or when a job intermediary engages in intermediary activities, the workers shall not be subject to discrimination because of their ethnic backgrounds, races, gender, religious beliefs, age, physical disabilities, etc., and rural workers who go to cities for employment shall enjoy equal right to work as urban workers do; people’s governments at or above the county level and the relevant departments shall enhance the administration of job intermediaries, encourage them to improve the quality of their services; companies shall reduce sizeable workforce in compliance with relevant laws and regulations; the State establishes a statistical system for workforce survey and a system for employment and unemployment registration.

(5) Vocational Education and Training

The State develops vocational education and encourages vocational training; the State encourages and supports various types of vocational colleges and schools, vocational skills training institutions and employing units to, in accordance with law, provide pre-employment training, on-the-job training, continuing education and re-employment training; the State establishes the vocational ability evaluation system to promote employment, and applies professional qualification certificate system for certain professions.

(6) Employment Service and Employment Aid

People’s governments at or above the county level shall improve public employment service system to provide public services for employment; local governments at all levels shall establish a sound aid system for employment and re-employment; people’s governments at or above county level all shall improve their service in respect of employment aid at the grass-roots level, and provide targeted employment services and aid related to public welfare jobs.

2. Law of the People’s Republic of China on Employment Contracts

Law of the People’s Republic of China on Employment Contracts has been formulated in June, 2007 to establish an employment system corresponding with the socialist market economy under which employing units and employees have two-way choices, to realize the market-oriented allocation of human resources, and to build and develop harmonious and stable employment relationships. The employment contract is the basis for rural migrant workers to protect their rights and interests.

(1) Conclusion of Employment Contracts

The conclusion of employment contracts is the basis for the implementation of employment contract system. The major provisions are: the Employer’s duty of disclosure; the form of conclusion of employment contracts; employment contracts of labor dispatch; the probation of employment contracts; the invalidity and repeal of employment contracts.

(2) Performance and Amendment of Employment Contracts

To ensure the Employee’ lawful rights and interests against infringement in the performance of employment contracts, the law stipulates that the Employer and the Employee shall fully perform  his obligations in accordance with the employment contract, and the Employee himself shall perform the contract actually; the law confirms how to deal with the employment contract when the Employer is merged or divided; the law confirms the requirements to suspend and resume performance in special cases where the Employee is drafted into the Army or is suspended from office to perform other obligations of the State.

(3) Termination and Ending of Employment Contracts

In order to tackle the problems, such as, the termination and ending conditions are not clear enough, the Employee fails to get financial compensation at the ending of the contract and others, the law governs the conditions for the Employer to terminate the contract, the conditions for the Employee to terminate the contracts, and the financial compensation at the termination or ending of the employment contract.

(4) Equal Bargain and Collective Contract System

Equal bargain and collective contracts play an important role in safeguarding the rights and interests of the Employee. To bring the role into full play, the law governs that the Employer’s rules and regulations, which are directly involved in the Employee’s vital interests, shall be presented to the trade union, the employee representative congress or all the employees for discussion and approval, or shall be bargained and stipulated on an equal basis; the trade union shall give assistance and guidance for the Employee and the Employer to conclude and perform the employment contract in accordance with law; the trade union and employee representatives have the authority to,  after bargaining with the Employer on an equal basis, conclude a collective contract on such matters as labor compensation, working hours, rest, leave, work safety and hygiene, insurance, benefits, etc..

(5) Monitor the Implementation of the Employment Contract System

To enhance the monitoring inspections to the implementation of the employment contract system is an essential guarantee to protect the lawful rights and interests of the Employer. The major labor and security departments of the people’s governments at or above county level and the people’s governments at town and township level are empowered with the authority to monitor and inspect the conclusion and performance of employment contracts

II. Promoting Local Employment Through

“One Village One Product”

 

Law of the People’s Republic of China on Promotion of Employment stipulates that people’s governments at or above the county level shall create conditions for employment and increase employment by taking such measures as developing the economy, adjusting the industrial structure, specifying the market of human resources, improving employment services, strengthening vocational education and training, providing employment aid, etc. The Central Document No.1 of 2010 has required to promote “One Village One Product”, and to make villages prosperous and farmers rich. According to the requirement, all parts of China, taking the market as orientation, have given full play to farmers’ principal role and vigorously developed the multi-functions of agriculture, on the basis of their own facts. As a result, “One Village One Product” has maintained a stable momentum with further expansion of specialized villages. The promotion of farmers’ employment has been fruitful. We call this model as “One Village One Product” Promotes Local Employment.

1. Background and Model

“One Village One Product” is a product of the rural market economy and socialized mass production, as well as a kind of presentation on the agriculture with the village as the basic unit, the rural economic specialization and large-scale development model. After reform and opening-up, the improvements in the rural market and the rural marketization have been important backgrounds for the development of “One Village One Product” economy. Not only do they provide adequate price signals to village-region leading products, but also provide effective factor market and product market.

With the development of national economy and the emergence of a buyer’s market of grain, it is an important issue in China’s modern agricultureto use the resources of all regions to their advantage to meet consumers’ increasingly versatile and optimized demands while improving the local labor productivity. “One Village One Product” is namely to, taking the market as the orientation, develop the local economy by producing readily marketable products, on the basis of the local advantages of resources, nature and humanities. Therefore, “One Village One Product” is an important model in China’s new stage to develop modern agriculture and promote farmers’ employment.

The marketization in the rural areas has been constantly improved, food security issues have been roughly resolved, and the national economy has entered a new phase with the overall urban-rural development strategy. Under these circumstances, as decision-making bodies, farmers or village collective economic organizations have developed kinds of special and specialized, new and novel, refined and exquisite tangible and intangible products and industries, especially, gardening industry, special aquaculture and rural tourism, on the basis of their certain circumstances, with typical cases taking the lead. They do this under governmental planning, guidance and policy supports, and make adjustments with ever-changing market demands. Farmers’ local employment has been efficiently promoted.

2. Key Points of the Model

(1) Safeguard Farmers’ Decision-Making Power

In the development of “One Village One Product”, it is important to improve farmers’ quality, for it means to raise the level of systematization. Since farmers are the main body in “One Village One Product”, only by improving farmers’ quality, raising the level of systematization and safeguarding their decision-making power can we protect their interests, promote their employment and increase their income in developing “One Village One Product”.

(2) Improve the Leading Products’ Industrialization and Branding

“One Village One Product” economy has raised the level of systematization, and reduced the transaction costs of leading companies and farmers by collective productions. It is not only beneficial for the control, prevention and interconnected transactions among the leading companies and farmers, but also beneficial for the leading companies and farmers to form an interest community, to resolve the docking problem between small-scale production and large-scale market. Therefore, the development of “One Village One Product” needs to realize the production industrialized, organic and branded, meanwhile provides requirements to realize them.

(3) Improve the Socialized Service System of the Leading Products

Under the household contract responsibility system, “One Village One Product” economy needs to improve the socialized service system of the leading products to reduce production cost, to enhance the market competitiveness and the market share of the leading products. To improve the socialized services of the leading products, the core is the industrial chain of the leading products, and village collectives, specialized cooperative economic organizations, the leading companies and other organizations provide kinds of services with scale advantage to farmers.

(4) Adhere to Industry Specialization and Product Diversification

The ultimate goal of “One Village One Product” economy is to enhance agricultural market competitiveness and promote farmers’employment. Under the market economy, to give full play to the resource advantage within village-region, the resources must be collected to develop the leading industries, especially labor-intensive industries, such as gardening industry, special aquaculture, rural tourism and green food production. On the basis of competitiveness promotion, to effectively evade the market risks caused by market fluctuations, it is also needed to develop relevant processing industries for agricultural products, extend the industrial chains of agricultural products and diversify the products based on industry specialization. By doing these, the ability to withstand market risks could be enhanced.

III. Promoting Employment Through Public Employment Services

Developing public employment services to create a highly-effective, good and convenient platform of public services for the transfer of employment of rural labor force, is an important symbol, which shows the government’s public functions to promote employment, as well as an important measure and one of the major channels to promote the transfer of employment of the rural labor force. Having developed for more than 20 years, the public employment service system has been initially established, and the public employment service network covering urban and rural areas has taken into shape. The local governments of China, in the spirit of humanism, have innovatively worked for public employment services with increasingly improved service content and increasingly diversified forms. They have played an important role in guiding the orderly flow of rural surplus labor force, promoting the overall urban-rural employment and other aspects. We call this working Model as The “Public Employment Services to Promote Employment”.

1. Background and Model

Law of the People’s Republic of China on Promotion of Employment stipulates that people’s governments at or above the county level shall establish a sound system to provide public services for employment, set up public service agencies for employment and provide public employment services to the workers gratis; meanwhile the law confirms the basic system, safeguard measures, specific tasks and service specifications of the public employment service.

Having developed for more than 20 years, the public employment service system, which is to regulate the market and promote employment by the government, has been initially established, and the public employment service network covering urban and rural areas has taken into shape. They have been playing an important role in many aspects, including balancing overall urban-rural employment, guiding the orderly flow of labor force, maintaining the lawful rights and interests, and fulfilling the guidelines that workers make self-choices in employment, the market adjusts employment and the government promotes employment. Especially since 2008, the public employment service has been playing an irreplaceable role in stabilizing employment in face of the huge shock caused by the financial crisis to employment.

The public employment service refers to the commonweal employment service funded by the government and provided to workers. The public employment service agencies and the public employment service system are comprehensively managed by the department of human resources and social insurance at all levels. The public employment service has four basic elements: the first, its goal is to promote employment; the second, the service is defined by providing commonweal services; the third, the service is fixed orientation by its public functions; the fourth, public policies and public finance offer safeguards and supports for the service.

To promote the transfer of employment is that the public employment service, depending on the service platform, plays a part in the governmental promotion for employment. The vast rural workers have been provided with a series of commonweal employment services through policy advice, vocational guidance, vocational training and occupation introduction, the implementation of the policies to promote employment, the launch of various special activities for the employment service, etc.. By this, we have promoted the transfer of employment and stable employment of therural labor force.

2. Key Points of the Model

(1) Improve the Platform for Labor Security at Grass-Root Levels

The first is to intensify institution-building. Villages and towns shall set up management stations for labor security, and the village-level stations shall have service windows and assistants for labor security, to provide the labor security and the employment service network with organizational guarantee to extend to rural areas. The second is to intensify informatization. We shall establish a public employment service network covering urban-rural areas, to realize the employment information networked and the transaction of business informationized. The third is to intensify professionalization. We shall promote vocational training for the assistants and require them to work with licenses, and improve the quality and ability of employees in rural grass-root platforms. The fourth is to intensify institutional construction. We shall clarify the projects, content, standards and procedures of services, publish supervision hotlines, and establish and implement the post responsibility system, the responsibility system for first inquiry, the service commitment system and the system of fulfillment within specified time.

(2) Make Sure of the Base Number of Rural Labor Force

The first is to set up a statistical investigation system for rural labor force. Relying on the labor security platforms of villages and towns, we shall make sure of the rural labor resources and accumulate basic data, to offer adequate information for management services. The second is to set up an information base for country-level, township-level and village-level rural areas. We shall make a detailed record of the information of rural workers, including age structure, employment wills, skills, employment directions, income and professions. The third is to apply dynamic management. We shall visit and investigate farmers at regular intervals, have a good command of the changes in rural workers’ employment, and update the statistics in time to ensure it effective.

(3) Collect and Publish Employment Information

The first is to set up a mechanism for information collection. We shall widely collect the information of companies’ recruitment and wages, to know about the working environment, the living environment, benefits and other information of the employing units. The second is to set up a mechanism for information screening. We shall verify the information one by one to ensure it real and reliable, and classify the information to set up an information base for employment. The third is to set up a mechanism for publishing information. We shall publish the employment information at regular intervals, at fixed time and at a given fixed place, at the same time, we shall increase the publishing volume and the publishing frequency of the information when it comes to the returning rush before the Spring Festival, the going-out rush after the Spring Festival and slack farming seasons. The fourth is to innovate the form of information publishing. We shall broaden the information channels of rural workers, through broadcasts, televisions, newspapers, columns, networks, text messages, compiled and printed materials and other forms.

(4)  Launch Publicity Consulting for Employment Policies

The first is to make sure of the key points of the publicity. We shall regard the vast rural workers and migrant workers as the major targeted groups. The content of the consulting shall be close to the top concerns of the vast rural workers, such as the employment aids, the policy to protect their rights and interests, the knowledge of labor safety, the common sense for living in cities and other contents. The second is to emphasize the effectiveness in a certain period of time. We shall seize the accuracy and timeliness of the information, strive to inform the vast rural workers of important policies and regulations for the first time, and improve the transparency of policies to make them as widespread and understood as possible. The third is to innovate the form of publicity. Apart from the conventional media publicity, we shall adopt the forms which people love to see and hear and the expressions which are easily understood. Besides, such as through networks, text messages, posters, printed materials and other forms.

(5) Intensify the Basic Public Employment Service

The first is to recommend jobs to job-hunters. We shall help the job-hunters find suitable employment information and employment units, and recommend the job-hunters to various recruiting activities organized by the department of human resources and social security and other departments. The second is to carry out activities for vocational guidance. According to the job-hunters’ abilities and skills and the requirements of the occupational posts, we shall help the job-hunters have a proper view of employment, help them analyze and choose the vocational orientation in a reasonable way, and suggest to take a part in vocational trainings. The third is to develop vocational trainings. Relying on training agencies, in accordance with the principles of practicality, pertinence and effectiveness, we shall provide the rural workers, who are willing to work and accept trainings, with skill trainings and skills certification which are in line with their characteristics and market demands. Besides, we shall give the job-hunters subsidies by rule. The fourth is to develop labor collaboration. We shall enhance horizontal contacts with developed areas, and have a good command of the supply and demand and traits of the human resource market in input and out areas. And we shall create a platform for communication and exchange to carry out the relevant activities.

(6) Develop Various Special Service Activities

The first, according to the special deployment by the relevant national and local departments, we shall mobilize and organize the involved parties in time, to ensure the implementation of the work. The second, on the basis of the local facts, we shall enhance human services by researching and formulating specific programs, and provide the vast workers with comprehensive employment service in a practical way. The third, in face of the different traits and requirements of different targeted groups, we shall respectively carry out comprehensive service activities for different groups, such as, Spring Wind, Month for Re-Employment Aids and other large-scale special job fairs.

(7) The Functions of Trade Unions, Communist Youth Leagues, Women’s Federations

The first is to strengthen coordination and cooperation. We shall proactively establish contacts with trade unions, communist youth leagues, women’s federations and other organizations, and strive for their cooperation and supports. The second is to set up a linkage mechanism. By regular communication and exchanges, we shall research and analyze the employment of different groups in the rural labor, and put forward specific working plans. The third is to join working forces. We shall take advantage of the strength of trade union, communist youth leagues and women’s federation and other organizations in the respective fields, and carry out targeted employment aids for different groups in the rural labor.

IV. Promoting Employment Through Vocational Skills Training

 

The vocational skill training is a fundamental measure for the government to help the rural workers find other jobs. Law of the People’s Republic of China on Promotion of Employment has established a lifelong system of vocational skills trainings for workers, including pre-employment training, on-the-job training, re-employment training and training for starting undertakings. Some counties or cities increase financial investment for vocational trainings to improve the trainings and the subsidy policy on skills certification. And they combine the establishment of public training bases with more guidance and supports for training agencies, to fully mobilize various training agencies. Besides, a market-oriented training system has been established to meet the multilevel demands of the urban-rural workers, to facilitate the transfer of the rural labor force to the secondary and tertiary industries. We call this model as Vocational Skills Training to Promote Employment.

1. Background and Model

The lack of vocational skills is a major factor to affect the transfer of the rural labor force and the stability and employment. To develop vocational skills trainings for the rural labor force, and to strengthen the migrant workers’ employment competitiveness by raising their skill level, are significant for the transfer of the rural labor force, the increase of farmers’ income, the establishment of the new socialist countryside, the industrialization and modernization of China.

In recent years, the government has highlighted the trainings for the rural labor force, formulating a series of incentives and favorable policies. Ministry of Human Resources and Social Security, IPRCC and other departments have widely implemented a series of training programs for practical skills and vocational skills, including the Training Program for Special Professions, Sunshine Project and Dewdrop Project. Besides, the training programs for the rural labor force have been subsidized by the governments, achieving remarkable results.

The vocational skill training is to equip the able-bodied workers with prerequisite professional knowledge, operating skills, professional ethics and professional disciplines in a certain profession, according to the standards and requirements for the profession.

The vocational skill training is to equip the rural workers with necessary skills, who would like to find other jobs but lack in vocational skills. Then, the rural workers could meet the demand of the transfer with certain vocational skills. By this, the trainings promote the transfer of employment and the stability of employment.

2. Key Points of the Model

(1) Formulate Training Plans

The first is to formulate training plans according to the local facts of the rural labor resources and the local industrial characteristics. We shall confirm the orientation of the training, put the training measures into practice, and specify the training management. The second is to set up leading groups for coordination, with the supports from the departments of human resources, agriculture, education and finance and other departments. The third is to list the vocational skills trainings for the rural labor force as the priority of the governments at all levels. And the work of the governments would be assessed with responsibilities yearly.

(2) Coordinate the Training Resources

The first is to integrate resources for educational trainings. We shall take full advantage of various vocational colleges and schools, schools for technicians, and private training institutions, to form a socialized, professionalized network for vocational skills trainings. The second is to build the leading training base in a faster pace. With planned and systematic improvements in school conditions, we shall establish a series of leading bases for practical trainings which could drive others. The third is to improve the training institutions at grass-root level. We shall improve their training quality and abilities to enable the rural labor force to accept trainings in the neighborhood.

(3)Develop Classified Training

The first, for the rural graduates from junior-senior high schools who do not enter a higher school, we develop 1- to 3-year vocational skills trainings or education in vocational schools and the schools for technicians. They could find jobs successfully with elementary, intermediate and advanced vocational qualifications. The second, for the young labor force and the land-levied farmers, we promote their transfer of employment through short- and medium-term trainings for a single vocational ability or the elementary skills. The third, for the rural labor force who would like to start their own business, and the rural migrant workers who return home, we help them start their business through trainings for the basic entrepreneurship knowledge. The fourth, for the employed rural migrant workers, we stabilize their employment through trainings for skills improvement.

(4) Innovate the Form of Training

The first, we shall make the trainings more targeted through instructing the various and multi-level training technicians to develop the orientation training and the order training. The second, we shall take advantage of the teaching materials of schools and the resources for practical trainings of companies, in a comprehensive way, through proactive cooperation with schools and companies. Besides, we shall make the training more pragmatic, through enhancing the operating trainings, according to companies’ need for workers. The third, we shall popularize different Models, including the combined training of the training institutions and the villages, and sending the training to villages. Then, it is convenient for the rural labor force to accept the trainings in the neighborhood at a lower training cost. The fourth, we shall guide and encourage companies to make the best of the existing sites, equipment, personnel and technologies, to carry out skills trainings for the rural migrant workers in a planned way.

(5) Specify the Training Management

The first, in the light of the principles of openness, impartiality and fairness, we shall apply site-specific socialized and dynamic management for the training institutions, and regularly publish the name of the site-specific training institution. Besides, we shall also publish the training professions, the training tasks, the training time, the subsidy standards, the orientation of employment and other information. The second, we shall realize the institutionalization and specification of the training management, through formulating unified and specified training regulations, and standing books for training and employment. The third, we shall establish a system for daily supervision, an assessing system for trainings, a checking system for achievements, a system for fund management, and an information management system for vocational trainings, to supervise and manage the whole course.

(6) Increase Investment in Training

The first, we shall take full and good advantage of the national subsidies, and comprehensively arrange the training funds from the departments of human resources, agriculture, poverty reduction and other relevant departments, to maximize the effect of governmental training funds. The second, people’s governments at all levels shall increase the fiscal investment, place emphasis on the leading role of the governmental training funds. They shall arrange full investment and constantly increase the investment in local training funds. The third, we shall establish a multilateral mechanism for fund collection, to broaden the channels for fund collection. Besides, we shall guide and encourage all sectors of society to support the trainings, and supervise and instruct companies to draw and use the training funds by rule.

V. Promoting Employment by Starting Businesses at Hometown

 

In recent years, some local governments have integrated supporting migrant workers’ entrepreneurship into the county economic development planning, and have established corresponding management mechanism. The governments also have introduced a series of preferential policies to support entrepreneurship, including small-sum secured loans, tax relief, entrepreneurship training, market access, land use, business guidance, children’s education, attracting a large number of migrant workers returning home to start their own businesses. They own capital, technology, information and management philosophy. Many businesses started by the returnees have a strong ability to absorb and radiate local labor force. These businesses are also effective in promoting the transfer of rural labor force. We call this model “promoting employment by starting businesses at hometown”.

1. Background and Model

In the process of developing county economy and constructing small towns, and as the transfer of labor-intensive industries speeding up in the developed coastal areas, the development opportunities in underdeveloped areas continue to increase and the development environment improves gradually. Some regions used to export labor, now the migrant workers rush back to start their own businesses. The transfer of rural labor force has entered a new stage.

According to a survey, every returned migrant worker who set up an enterprise can provide jobs to 7 or 8 people on average. If there are nearly 5000000 returned entrepreneurs at the time being, then about 30000000 local rural labors can be transferred at or near their hometown. In recent years, many governments in places where used to export labor services attach great importance to the phenomenon that migrant workers start their own businesses at hometown. And the government have carried out and vigorously promote hometown business projects such as “Building Nest to Direct Phoenix” to encourage and support migrant workers returning home to start a business or engage in individual operation.

Migrant workers starting businesses at hometown mean that some migrant workers have increased knowledge, and changed their mindset when they were working outside. So they use their accumulated knowledge, skills, information and funds, and return home to start a business, develop business services, invest in agricultural production and engage in many other operation activities.

Starting businesses at hometown promotes the transfer of employment means that the rural labor force worked in other cities, guided and encouraged by the preferential policies, come back to hometown and start their own businesses. They complete their own employment transfer, and at the same time, also created some jobs for his hometown, which absorb and promote the local rural labor transferring to the second and tertiary industry. It is also a new form and new approach of rural labor transfer in recent years.

2. Key Points of the Model

1. Optimize the Entrepreneurial Environment

First is the introduction of preferential policies, to provide capital, land and taxation support for businesses started by migrant workers. We should solve the problems that generally exist in the migrant workers entrepreneurial process, including capital, technology, talent and service and many other problems. Second is to expand access. Local governments and departments shall not set up their own constraints in the industries and fields that are not prohibited by the national law and regulations. Third is to strengthen the service consciousness, which means the government should simplify examination and approval procedures, improve efficiency, promote the joint approval and one-stop service. Fourth is to regulate market order, abolish the arbitrary charges and fines and unjustified levies, and cancel various for-profit inspection activities. Fifth is to develop service institutions. We should rely on the scientific research institutions and institutions of higher learning to encourage trade associations and chambers of commerce and other organizations to provide technical information, market development and credit counseling services for migrant workers.

2. Improve The Financial Support

First is to increase the financial policy support to migrant workers returnees. The problems such as lack of funds, financing difficulties and high interest rate can be solved through small-sum secured loans. Second is to promote the pilot village banks and new types of rural financial organizations, let the rural credit cooperatives take effect and provide business services for migrant workers. Third is to provide easier credit terms, reduce the threshold of counter-guarantee departments and lower the loan guarantee (pledge) standard. For those promising entrepreneurial projects that have good markets, economic returns and backed by advanced technology, the government should improve the loan ceiling and extend the length of loan maturity appropriately. Fourth is to provide financial support actively. Local government, if having the ability, can set up a special fund to support migrant workers. This fund can be used as migrant workers guarantee funds, discount interest and can also be used for entrepreneurship training.

3. Build an Entrepreneurial Platform

First is to make full use of the existing pioneer park, various types of wholesale markets, commercial streets and trade cities to provide places for migrant workers to start businesses. Second is vigorously promoting the entrepreneurial base construction, and draw funds, technology and talents and other production factors to entrepreneurial base, play an exemplary role in promoting entrepreneurship. Third is to properly solve the land problem when starting a business. Make use of idle land, workshop, rural schools and corner lot, barren hills, wasteland etc. To those successful businesses that meet the requirements of industrial policies and construction planning, we should properly solve the problem of long-term investment and the scale use of land.

(4)Strengthen Entrepreneurship Training

First is to build training base, increase the training teachers, select training materials and optimize training scheme in order to improve the training ability. Second is to establish the training system, improve every link of the training, and carry out free entrepreneurship training for the returnees. Third is to carry out teaching process in accordance with the SYB, SIYB teaching standards and requirements based on different business requirements of different business group, and carry out different types of training accordingly. Fourth is to organize experts to the scene to provide guidance according to the actual entrepreneurial process, and provide follow-up service in order to improve effectiveness of the training.

(5) Strengthen Publicity And Guidance

First is by using of radio, television, newspapers and the Internet and other media, we should carry out extensive publicity of business support policy and promote good examples and experience to create a good public opinion environment for migrant workers to start a business. Second is to carry out the assessment and award the outstanding businesses to play an exemplary role. It will enhance the entrepreneurs’ sense of achievement and sense of honor, and encourage more migrant workers to return home and start a business. Third is to let the news media play the role of public opinion supervision, protect the legal rights and interests of returned entrepreneurs and the enterprises they established, and thus create a good atmosphere that the whole society care and support the migrant workers to start businesses.

VI. Promoting Transfer of Employment By Find Jobs

At Or Near Hometown

 

Law of PRC on Promotion of Employment stipulates explicitly that local people’s government at or above the county level shall push forward the development of small towns (townships), accelerate the regional economic development of the counties and give guidance to the surplus agriculture workers in their efforts to find other jobs at or near the places where they live. In recent years, some traditional labor export areas focus on new changes of the economic and social development, and change their ideas, adjust their working methods timely, and broaden the channels of employment. Thus they clearly put forward the policy to implement several methods simultaneously, including transfer employment by find jobs at or near hometown, export labor force to other cities and the start undertakings at hometown. They actively guide farmers to transfer employment at or near hometown. Some places, through supporting characteristic industry, transfer local rural labor force at their hometown. Or they promote the development of related industries through urban and rural infrastructure construction, in order to provide a large number of employment opportunities to transfer rural surplus labor force. We call this model “promote transfer of employment by find jobs at or near hometown”.

1. Background and Model

Since the reform and opening up, China has undergone rapid economic and social development, its industrial structure has been adjusted continuously, and it has gradually changed the traditional agriculture outlook that existed for a long time in rural areas. The coastal developed areas in the east have created a large number of jobs because of the booming township enterprises, private economy and county economy, and take the lead in transfer rural labor. In recent years, as the Western and Central China Development Strategy and coordinated development of regional economic strategy have been pushed forward, the production factors flow to underdeveloped regions faster. It not only has promoted traditional labor export areas to adjust industrial structure, but also opened up a new channel for the transfer of rural labor force. All regions have been adjusting their work methods, and seize the favorable opportunity. They undertake the transfer of industries and develop local economy, at the same time, they actively guide the transfer of rural labor force at or near their hometown, and they have achieved remarkable results

According to a sample survey by the National Bureau of Statistics, by the end of 2008, 85000000 rural labors have already transferred at or near their hometown in China, accounting for 37.8% of the total number people need to transfer. Transfer of rural labor force at or near their hometown not only can effectively alleviate the city construction and social management pressure posed by the flow of large number of rural population and can also promote the rational allocation of human resources, accelerate the comprehensive development of county economy and economy in the underdeveloped areas. It also is conducive to stabilize the structure of rural communities, improve the rural grassroots organizations, and promote the building of a new socialist countryside. At the same time, it has advantage of short distance, low cost and little risk.

Employment at or near hometown refers to the employment that rural labor force are employed in villages and towns of their registered permanent residence. Or if they leave their villages and towns and work in surrounding areas, they still live at home for more than six months a year, and the labor income are their main source of income.

Promote transfer of employment by find jobs at or near hometown means that against the background that the county economy develops rapidly and creates a large number of jobs, the rural labor force turn to non-agricultural employment vigorously in the form of “leave earth without leaving home”. At the same time it helps some rural labor force and disadvantaged groups who cannot work outside throughout the year. Now they can take the advantage of short distance, low cost and small risk and achieve transfer of employment at their hometown. It has improved the scale of transfer and also the stability of employment.

2. Key Points of the Model

(1)Make Plans in Advance According to The Economic Development

First is to know the current and future goal of economic development and industrial development planning, as well as the labor quantity, structure and quality requirements. Second is to combine them with the local labor situation, draw up the rural labor resources development plan in advance. We should draw up rural labor occupation training plan according to the local occupation training resources, and carry out the training according to the plan and goal in order to reserve the labor resources in advance. Third is based on the fact that the transfer of rural labor force at or near hometown continues to expand, we should formulate local labor security development plans, improve the employment services, employment management and social insurance policy system, and build all kinds of management service platform and information network as soon as possible.

(2) Make Use of Both Urban and Rural Areas to Develop Jobs at Home

First is to develop jobs in industrial parks, guide the rural labor force to work in the enterprises of county industrial parks, the township industrial zones and village industrial spots. Second is to take the form of "company + farmers" to produce materials supplied by clients, customize the samples, assembly parts and process agricultural byproducts, and guide the rural labor force to work at home, and work flexibly. Third is to develop jobs in commercial and service sector, to guide the rural labor force to engage in commercial and service industry, such as food processing, hotel catering, wholesale and retail, housekeeping services, and support the farmers to set up tourism and leisure projects like “happy farmhouse”. Fourth is by using the construction of rural infrastructure and livelihood projects to organize rural labor to participate in projects like pond dredging, village regulation, rural road construction. Fifth is to develop jobs within agricultural industry. Make full use of the great opportunity of rapidly advancing agricultural industrialization to guide farmers to voluntarily transfer the land for money in accordance with the law, and realize the transition from traditional agriculture to high-efficiency agriculture. Encourage farmers to engage in agricultural product processing, circulation, storage and transportation industries to elongate agricultural industrial chain, and develop more opportunities inside agriculture. We should support the development of the specialized farmers’ cooperative organizations and leading agricultural enterprises and improve the organization of transfer within agriculture industry to realize the transformation from traditional peasants to agricultural workers.

(3) Extend Function To Strengthen The Rural Employment Service

First is in accordance with the requirement that  “integrate urban and rural areas, build the platform to the village, link to every household, provide service to the people”, we should pay special attention to the construction of the public employment service platform at both township and village level, and ensure that the recruitment information flows smoothly and management services are in place. Second is to carry out the investigation of rural labor force transfer at or near their hometown, establish and perfect the related basic information, and know the farmers’ desire to transfer and the training needs. Provide policy advice and release employment information in time, make sure the local enterprises’ employment needs are in line with local labor resources. Third is to establish employment aid system for people who have employment difficulties. We should use employment assistance policy to develop jobs in local enterprises such as clean-keeping, green-keeping, security and public service jobs like highway maintenance and pond management, thus to promote employment for rural labor who have employment difficulties.

VII. Labor Service Cooperation Drives The Transfer of Employment

To promote rural labor trans-regional employment, we must make efforts to connect the export area and import area. Now, more and more local governments have realized this, and thus the collaboration between different regions continues to rise. The cooperation is presided over by the leaders of the government, the corresponding departments of the export area and import area sign contracts, and the corresponding cities or counties sign contracts, the labor services export organization and the employers sign the employment agreement. The content of the agreements include transportation and settlement, rights protection and security, training and service etc. Through the collaboration between different regions, the transfer of rural labor force has changed from random transfer that every labor finding his own job to the orderly transfer of labor service cooperation between governments. We call this model “labor service cooperation drives the transfer of employment”.

1. Background and Model

In order to promote the orderly flow of rural labor force and complement each other’s advantages and achieve mutually benefit and win-win results between developed areas and underdeveloped areas, in recent years, areas across the country carry out different levels and different kinds of labor services. There are national level cooperation that carried out by the government and targeted at aids to the Three Gorges Reservoir area and the earthquake stricken area; cooperation between the provinces and cities, and cooperation between the city and county, county and county counterparts according to the labor supply and demand situation. At the same time, collaborative organizations have expanded from the department of human resources and social security to local governments, departments, social organizations, employers and multiple levels of departments. Cooperation contents have extended from single labor export and import to fields such as the vocational skill training, social insurance management and rights protection. The forms of cooperation have developed from cooperation only between departments to a variety of cooperation, such as cooperation between schools and enterprises, between different schools, between training institutions and intermediary agencies.

Labor service cooperation refers to the labor exchange between the developed areas and underdeveloped areas. Its goal is to complement each other’s advantages and achieve mutually benefit and win-win results. It means that the labor force flow orderly among regions for corresponding jobs. And it is a long-term activity that has good organization, institution, and regulation

Labor service cooperation drives the transfer of employment means that the counterparts of export and import define each other’s responsibilities and obligations by signing a labor service agreement. And also jointly formulate labor export and import program, and coordinate in a series of work, including publish information, reserve resources, organize recruitments, carry out skill training and far distance transportation so as to promote transfer of rural labor in underdeveloped areas to the developed areas and large and medium-sized city .

2. Key Points of the Model

(1) Cooperation Between Organizations

First is to strengthen the leadership of the organization, the two sides should set up a leading institution for labor service cooperation; this institution should be led by the government or the relevant department. The institution should study and formulate policy, measures, long-term plans and annual plans. Second is to perfect the cooperation system. All provinces, cities, counties, townships should arrange specific departments and personnel according to their own situation. The exporter can set up an agency in the import area based on their needs to make sure smooth labor service cooperation. Third is to improve the coordination mechanism in order to carry out regular communications and visits, timely exchange information, study and analyze existing problems, and take corresponding measures in time. Fourth is to implement target assessment. The two sides should determine the targets of their own, and then carry out regular checks and implement punishment system to ensure the smooth completion of targets.

(2)Exchanges of Employment Information

First is to improve the labor supply and demand information exchange system. Labor import area should carry out survey of enterprises’ labor demand regularly to collect employment information, and give the information to the corresponding export area first. The export area should carry out surveys of rural labor resources regularly to have comprehensive information of the number, structure, education level, skill, employment aspirations of the rural labor force in this area and report the situation of resource reserves to the corresponding import area in a timely manner. Second is to organize labor exchange and special recruitment activities jointly and publicize the employment environment and enterprises image of the labor import area, and display rural labor skills and advantages and overall image of the export area, so as to increase mutual understanding. Third is to achieve the goal that internet can be used as a modern means to serve labor service cooperation. We can carry out remote recruitment, personnel interview activities by using video technology to reduce the communication cost and improve effectiveness.

(3) Cooperation in Skill Trainings

First is to carry out the trainings for specific jobs. The labor export area should organize the local labor force who desire to work outside to attend specific skill training based on the enterprises’ labor demand. After passing the training, the workers can be sent those enterprises. Second is to develop school-enterprise cooperation training. The export area should carry out certain theoretical knowledge and general technical training in the local community, and the import area should use the equipment and venues to carry out skill training before the worker begin their jobs. This will improve the training effect. Third is to guide different schools to cooperate. Schools in the export area are responsible of enrollment of students and theory teaching, as schools in the import area are responsible of practice training and graduate arrangement. Thus a perfect connection between school and factory would be achieved.

4. Provide Follow-Up Services Jointly

First is to establish a mechanism that the Department of human resources and social security of both the export area and the import area provide follow-up services and carry out joint law enforcement. They can jointly safeguard migrant workers legitimate right and interests by issuing of the contact card and spring breeze card (an information card to help the workers find jobs), announcing complaint hotlines to protect workers’ rights, and publishing labor security laws and regulations. Second is to let the labor service management agency in the import area established by the export area take effect. They should pay regular visits to the employers to understand the situation such as production safety, wage payment, social insurance of enterprise, and coordinate in handling of labor disputes, strengthen the organization and management of the mobile party members andleague members. Third is to do a good job in manage and serve migrant workers. They should solve practical difficulties workers meet in production and daily life, and carry out activities a variety of cultural and recreational activities to honor and comfort workers and to enrich their spare time.

VIII. Small-Sum Secured Loans Boost Employment

 

Small-sum secured loan policy is the most direct and the most effective policy for the government to encourage and support laid-off workers to find new jobs or to start their own businesses. Many places have expanded their targets to farmers and other types of urban and rural workers. These places increase their financial supports by providing small-sum secured loans and many other means. So they effectively solved the problem of shortage of funds in the transfer of rural labor force, and opened up a vast world for the transfer of rural surplus labor force. We call this model “small-sum secured loans boost employment”.

1. Background and model

In order to encourage workers to start their own businesses, develop small businesses, create more jobs and give full play to the role of entrepreneurship in promoting employment, the government established a small-sum secured loans system. As an important part of the employment and reemployment policy, this system provides real, effective and the most direct support for entrepreneurs, self-employees, as well as the labor-intensive small enterprises.

Statistics show that it only takes 500 yuan on average for small-sum secured loans to support the development of a job, while it takes about 10000 yuan on average for the government to develop a public service job. On average, every successful business started by the workers can create jobs for 2.51 people, and every small enterprise in the labor-intensive industry, if supported by small-sum secured loans can employ 38.6 laid-off workers. Therefore, the target range of small-sum secured loans has expanded from urban laid-off and unemployed workers to the rural transfer labor force gradually, and the migrant workers who return home to start a business are the key targets for assistance.

Small-sum secured loans means that the government provide capital to set up a guarantee fund, finance department covers the interest subsidies of loans, guarantee agencies provide guarantee, and banks issue the loans. It is an assistance policy targeted at the problem that entrepreneurs or the labor-intensive small enterprises lack venture capital, and because of the lack of effective guarantee, it’s hard for them to obtain loans.

Small-sum secured loansboost employment means that by providing small-sum secured loans to rural labor force who desire to and have the ability to start their own business, we can support the farmers and migrant workers to return home and start their own undertaking. And besides helping migrant workers entrepreneurs to self-employ, we can, at the same time, create even more employment opportunities, provide more jobs, and thus boost the transfer of rural labor force employment.

2. Key Points of The Model

(1) Establish Guarantee Agencies And Raise Guarantee Fund

First is to strengthen the guarantee mechanism of all levels, including provincial level, city level, county level, and township level in order to establish a sound guarantee service system that can cover both urban and rural areas. Second is to define the full-time staff, implement the pre-loan investigation and verification, after-loan management and loan recovery. Give necessary incentives to human resources and social security department, guarantee agencies banks and business managers who have made outstanding achievements. Third is to actively extend financing channels, expand the scale of guarantee fund, implement fiscal interest subsidy to provide adequate funding for the ever-expanding the scale of small-sum secured loans. Fourth is to strengthen communication with financial institutions at various levels, introduce industrial competition mechanism, and give the necessary incentives to guarantee agencies and banks that have excellent service and outstanding performance and the handling bank to improve the efficiency and quality of small-sum secured loans.

(2) Improve Relevant Institution to Avoid Loan Risk

First is to define the target, condition, amount and maturity of small-sum secured loans and confirm the procedures such as application, audit and issuance of loans. Second is to strengthen the management, supervision and examination of loans. We should set interest rate of loans, and establish measures of loan recovery, risk management, recognition and treatment of bad debts. Third is within the scope regulated by the policy, we should explore to establish a mechanism to expand guarantee fund according to the proportion and give incentives according to performance. And we should explore the ways to reduce business costs and loan risk through increasing the loan interest rates appropriately. Also we can explore to establish a special support fund of small-sum secured loans to support the development of credit guarantee system for small and medium-sized enterprises.

(3) Innovate Service Philosophy And Strengthen Career Guidance

First is to lower the guarantee threshold, simplify procedures, expand the range of support, and provide project promotion service actively. We should also issue loans to meager profit projects that are defined by the government, and provide appropriate amount of loan and extend the length of maturity according to the actual situation. Second is to be well prepared before issuing. We should audit the condition of the loan applicant according to the regulation, assess and demonstrate the venture projects related to the loan, handle the relevant procedures for the qualified applicant in time, and issue the loans timely. Third is to strengthen the loan tracking service, understand the progress of the loans and the progress of the business projects. We should also provide training and other necessary help and guidance to the lenders when they meet practical difficulties and problems in their businesses, in order to ensure the loans can play an effective role and can be recovered timely.

IX. Protecting Rights to Boost Transfer Employment

 

To protect the legitimate rights and interests of migrant workers and create an equal and fair employment environment is a necessary requirement to balance urban and rural employment, build a harmonious socialist society. Since the mid of 1980s, rural labor migrant workers have been able to work and do business in cities, but for various reasons, they have suffered a lot of discrimination in cities, including some institutional discrimination. In recent years, this situation has changed a lot. All cities have cleared discriminatory policies and regulations towards migrant workers, and have made efforts to promote the reform and innovation of the system. They also have gradually established a unified urban and rural labor market, a fair employment system, a policy system and a law enforcement supervision mechanism to protect the legitimate rights and interests of the migrant workers. All these have effectively promoted the transfer of rural labor force. We call this model “protecting rights to boost transfer employment”.

1. Background and model

Migrant workers are an important force of industrial workers in the new era in China, but they are also a vulnerable group in the current human resource market. Most migrant workers are engaged in hard, tiring, dirty and dangerous work. Their educational level is low, their knowledge is limited, their works have high mobility, there are no one leads and organize them, and they do not know how to protect their own rights, so their rights can be easily violated. Safeguarding the legitimate rights and interests of migrant workers has become a major strategic issue of the Party and the government. It also attaches great importance to the smooth transfer of rural labor force, and is directly related to the development of economy and society.

In recent years, the state promulgated many laws and regulations and a series of important policy including “Labor Contract Law”, “Law of PRC on Promotion of Employment”. When it comes to regulating labor relations, mediating labor disputes, investigating and punishing infringement of rights according to the laws, we have gradually formed a relatively complete working system and mechanism. At the same time, we also have carried out extensive publicity of the legal system and strengthened market rectification. We focus on the migrant workers concentrated industries and continue to increase supervision of law enforcement, and urge enterprises to strictly carry out the labor contract. Thus we are able to effectively curb the momentum of serious infringement of the migrant workers’ rights, and create a better environment for the transfer of rural labor force and for stable employment.

Protecting rights means that when workers’ legitimate rights and interests are violated and they seek to safeguard their rights and interests, the national laws and regulations would support them, and the relevant departments of the government and all sectors of society would provide assistance. So through consultation, regulation, legal aid and other means, they can get all damage compensation they deserve.

Protecting rights to boost transfer employment means that according to the reality that migrant workers are vulnerable, we should, by providing protection and assistance, strengthen the support of their rights protection actions, effectively safeguard the legitimate rights and interests of migrant workers, so as to create a good market order that workers enjoy fair employment opportunity and they are paid according to the amount of work they have done, and also improve the stability of the rural labor transfer.

2. Key Points of the Model

(1) Improve the Legal Consciousnessof Both Employers And Employees

First is to put labor security policies and regulations publicity on top of the agenda to maintain order on human resources market and safeguard the legitimate rights and interests of the migrant workers. We should continue to carry out in-depth publicity activities to create a good social atmosphere. Second is to strengthen the guidance of employers to improve their consciousnessof employingworkers according to law and take the responsibility for maintaining harmonious labor relations, thus to provide a good production and living environment for migrant workers. Third is to provide trainings for the transfer of labor force and the rural migrant workers on awareness of rights protection, channels and methods of rights protection to improve the ability of migrant workers to safeguard their legitimate rights and interests in accordance with the law.

(2) Regulate the Job Intermediary Activities And The Management Service of Labor Export

First is to regulate all aspects of social job intermediary activities, crack down on violations of law such as using false employment information to bluff and deceive workers. We should give full play to the main channel and demonstration effect of public employment to provide free and good job introduction service to rural labor force seeking jobs in cities. Second is to strengthen the labor recruitment management, carefully examine the employers’ business license, the status of legal person and other supporting material. We should require the employers are in line with the requirements regulated by the government, including the types of work on this job, the wage and welfare, safe production conditions, social insurance. Third is to strengthen the study on labor import area to choose honest and law-abiding employers to establish long-term cooperative relations, and transfer the labor force mainly to them. We should do a good job in organization and management of labor services export and tracking services in order to improve the organization level of rural labor employment.

(3) Strengthen the Arbitration of Labor Dispute and The Law Enforcement Efforts of Labor Security

First is to make sure channels to complaint rights violation are clear, labor and social security departments at all levels should establish a hotline service for migrant workers to protect their rights. They should publish telephone complaint number, open up "easy access" of rights protection, provide policy advice and guidance services, and timely accept and treat the infringement cases and legal aid application. Second is to improve the rapid arbitration reaction mechanism of “fast registration, fast mediation, and fast arbitration”, treat cases involving the interests of migrant workers first such as deduction of wages or wages payment in arrears and industrial accident compensation disputes. For the cases that need the trial and execution of people's court, we should provide necessary assistance. Third is to maintain a high-pressure examination and punishment of violations on rights of migrant workers. We should focus on labor-intensive industry and high-risk positions, and often carry out special inspections of labor employment and law enforcement of labor security supervision to make sure we investigate all law-violation, find out and punish all law-breakers.

(4)Build a Harmonious Labor Relationship and Establish a Long-Term Mechanism to Safeguard The Rights And Interests

First is to improve and perfect the early warning mechanism of migrant workers’ rights protection, know the enterprise employment and labor relations status, timely detect problems, and timely resolve contradictions to prevent the mass disturbance and malignant cases. Second is to improve and perfect the margin system of migrant workers wage payment, focus on construction and other labor-intensive industries, as well as the industries and enterprises where contractual relationship is complex, infringement of rights is common, or wage payment arrears serious. Third is to improve and perfect the safeguard rights mechanism that many department are linked together, let the department of labor, public security, industry and commerce, taxation and other departments, as well as trade union, youth organization, and women's federation and the media play the role as a whole. We should relate the employment records of the enterprise with credit rating and tax relief policy, timely deal with the cases that the employers refuse to pay the workers and escape. We should carry out legal aid and social assistance, and expose the illegal acts that seriously violate the legitimate rights and interests of the migrant workers.

Conclusion

 

1. The Problems in Promoting Farmers’ Employment in China

(1) The Current Economic Development Strategy is Not Conducive to Promote Farmers’Employment

At present, being oriented by the economic development strategy,the governments pay most attention to local fiscal revenue and economy economic aggregate, so they focus on the projects that can increase revenue and economic growth rapidly, but these projects are resource-intensive of capital-intensive which can provide few jobs. The governments pay little attention to the modern service industry attention, and do not provide enough support policy to privately-owned businesses, miniature and small and medium-sized enterprises that can promote famers’ employment.

(2) Insufficient Employment Budget Restricts Farmers' Employment

The current state and local budgets have no related budget accounts of employment or human resources service. Because of the lack of regulations on the proportion and purpose of fiscal expenditure investment on the employment, it is inevitable that there occurs the problem of vague responsibility and imbalanced investment. The proportion of employment investment and education investment is seriously imbalanced, which will lead to the result that a substantial investment on knowledge and skills cannot be converted to practice. The shortage of employment service funds restricts employment promotion, and also affected the role of education.

(3) Employment Discrimination Makes It Difficult For Farmers to Find Jobs

There are employment discriminations towards gender, age and residence restrictions in China. Urban and rural household registration system has become insurmountable for rural labors living in cities when it comes to housing, education of children, medical insurance, and pension system. The employment discrimination limits the mobility of labor force and the configuration of resource. It promotes the employment structural contradiction and also caused a great waste of labor resources.

(4)Limited Employment Service Agencies Cannot Meet The Needs of Farmers

China established some professional occupation consultation service agencies around 2000, including some social employment service agencies, which makes the occupation consultation more market-oriented and professional. However, the current employment service agencies still cannot meet the needs of farmers’ employment training, and cannot meet the needs of employment service for all people. Facing of the upcoming employment peak, all kinds of occupation service agencies’ quantity and the rate of expansion cannot meet people’s needs.

2. Future Prospects of Policies on Promoting Farmers Employment InChina

(1)Change the Economic Growth Model to Employment-Oriented Growth

The most important goal of macro control should be to increase control over unemployment rate. Employment rate and its change should be used as indicators to evaluate the performance all levels of government, governments above the county level should meet the target of employment through economic development and adjusting industrial structure. We should also draw up and perfect all kinds of laws, policies, and evaluate their effects on employment in order to foster mechanism that attach much importance to employment.

 

(2) Improve Budget System of The Employment Services

We should establish a central-local hierarchical employment budget system to checkrespectively according to the employment services and projects. For example, vocational education, employment assistance program, job market construction, occupation information publishing and occupation skill identification should be included in financial budget of the central government, and funded by the central government order to reflect the principle of fair employment. And job training, all kinds of insurance subsidies, local insurance and loan guarantees should be funded by the local employment budget to reflect the difference of different economy.

(3) Ensure and Promote Fair Employment

We should establish a unified national labor market and a nationwide employment information platform. The construction of human resource market is to integrate and reengineer the existing labor market and other types of market. We should strengthen the human resources market information network and related facilities. We should also establish a nationwide recruitment information service platform to improve the information release system. At the same time, the government has the responsibility to regulate, supervise the human resources market to effectively safeguard the legitimate rights and interests of workers.

(4) Build National Employment Service Institutions of Various Levels

We should emphasize the leading role of the government in promoting employment, and establish a social, multi-level and professional employment service center participated in by the governments, schools, society, enterprises, intermediary organizations and individuals, so as to form a central-local two level service system and speed up the reform of government institutions. We should also change the situation that education, personnel, social departments are separated from each other in dealing with employment service in order to change from isolation to integration of different departments. We should encourage more enterprises to participate in the employment promotion work, provide internship, and publish job demands and requirements.

(5)Improve the Level of Employment Assistance

We should fairly define the scope and identity of personnel who have employment difficulties. The central government should determine the conditions and targets of employment assistance, and provide assistant funds to avoid employment discrimination caused by different local standards. We should carry out the employment service and occupation training actively, and transform from that the welfare department help the disabled people to an all-round employment assistance program. Promoting the social status of people who have employment difficulties should be set as the goal of employment assistance.

Annex 1

 

Law of the People's Republic of China on Promotion of Employment

 

　　(Adopted at the 29th Meeting of the Standing Committee of the Tenth National People's Congress on August 30, 2007)

　

　Chapter I  General Provisions

Article 1 This Law is enacted in order to promote employment, coordination between economic development and employment increase, and harmony and stability of society.

Article 2 The State lays great stress on employment increase in economic and social development, implements a proactive employment policy, and upholds the guideline under which workers keep the initiative in their own hands when choosing jobs, employment is regulated by the market, and the government promotes employment, in order to increase employment through multiple channels.

　　Article 3 The workers enjoy the right to employment on an equal footing and to choice of jobs on their own initiative in accordance with law.

In seeking employment, the workers shall not be subject to discrimination because of their ethnic backgrounds, races, gender, religious beliefs, etc.

Article 4 People's governments at or above the county level shall make employment increase one of their important goals in their endeavors for economic and social development, incorporate it in their plans for national economic and social development, and formulate medium- and long-term plans and annual work plans for promotion of employment.

Article 5 People's governments at or above the county level shall create conditions for employment and increase employment by taking such measures as developing the economy, adjusting the industrial structure, regulating the market of human resources, improving employment services, strengthening vocational education and training, providing employment aid, etc.

　　Article 6 The State Council shall establish a national mechanism for coordinating the efforts made to promote employment, whereby to study the major issues arising in this field of endeavor and coordinate and push forward such efforts nationwide. Specifically, the administrative department of labor of the State Council shall be in charge of the promotion of employment nationwide.

　　People's governments of the provinces, autonomous regions and municipalities directly under the Central Government shall, in light of the need for promotion of employment, establish mechanisms for coordinating the efforts made to promote employment, whereby to coordinate such efforts and solve the major issues arising in this field of endeavor in their administrative areas respectively.

The relevant departments of the people's governments at or above the county level shall, in compliance with the division of duties, make joint efforts to do a good job in promoting employment.

　　Article 7 The State advocates that the workers develop correct ideas about how to choose jobs and enhance their employability and the capability to start an undertaking, and encourages them to start an undertaking on their own initiative or to seek jobs by themselves.

People's governments at all levels and the relevant departments shall simplify procedures and increase efficiency to provide conveniences for the workers to start undertakings on their own initiative and seek jobs by themselves.

 

　　Article 8 The employing units shall, in according with law, have the right to employ people independently.

The employing units shall guarantee the lawful rights and interests of the workers in accordance with the provisions of this Law, other laws and regulations.

　　Article 9 Trade unions, Communist youth leagues, women's federations, disabled persons' federations and other public organizations shall assist the people's governments in carrying out the promotion of employment and, in accordance with law, protect the workers' right to work.

Article 10 People's governments at all levels and the relevant departments shall commend and reward the units and individuals that have achieved outstanding successes in the effort to promote employment.

Chapter II  Policy Support

Article 11 People's governments at or above the county level shall make employment increase an important duty, and formulate overall plans for coordinating their industrial and employment policies.

　　Article 12 The State encourages various types of enterprises to provide more job opportunities by creating new industries or expanding business operation within the scope as prescribed by laws and regulations.

　　The State encourages the development of labor-intensive industries and the service industry and supports small and medium-sized enterprises in their efforts to provide more job opportunities through multiple channels and by diversified means.

The State encourages, supports and gives guidance to the non-public sectors of the economy in its effort to develop the economy, thereby to increase employment and provide more job opportunities.

Article 13 The State develops both domestic and foreign trade as well as international economic cooperation, thus to develop more channels for employment.

 

Article 14 When people's governments at or above the county level make arrangements for government investment or decide on major construction projects, they shall pay attention to bringing into play the role of such investment or projects in promoting employment and providing more job opportunities.

　　Article 15 The State implements the fiscal policies which are favorable for the promotion of employment, increases the input of funds and improves employment environment in order to increase employment.

　　People's governments at or above the county level shall, in light of the employment situation and the goal set for the work concerning employment, appropriate from their budgets special funds for employment promotion.

The special funds for employment shall be used as subsidies for job recommendation, vocational training, public welfare jobs, appraisal of occupational skills, special employment policies, social insurance, etc., and as guarantee funds for small loans and discount interest on small guarantee loans for low-profit projects, and shall be used to support the public services for employment. The measures for management and use of the special employment funds shall be formulated by the finance department and the administrative department of labor of the State Council.

Article 16 The State establishes a sound unemployment insurance scheme to ensure the basic living standards of the unemployed in accordance with law and to promote their re-employment.

　　Article 17 The State encourages enterprises to provide more job opportunities and to support the unemployed and the disabled in finding jobs and, in accordance with law, offers the following enterprises and persons preferential tax policies:

　　(1) enterprises that meet the requirement for hiring the unemployed persons who satisfy the conditions as prescribed by the State；

　　(2) small and medium-sized enterprises set up by unemployed persons；

　　(3) enterprises that reach the assigned proportion for employment of disabled persons, or whose employees are entirely disabled persons；

　　(4) unemployed persons who engage in self-employed businesses and meet the conditions as prescribed by the State；

(5) disabled persons who engage in self-employed businesses；

(6) other enterprises and persons entitled to preferential tax policies as prescribed by the State Council.

Article 18 To the persons mentioned in Subparagraphs (4) and (5) of Article 17 of this Law, the relevant departments shall give due consideration in terms of business site, ect. and exempt them from administrative charges.

Article 19 The State adopts financial policies favorable for promotion of employment, open up more channels for financing small and medium-sized enterprises, and encourages financial institutions to improve financial services, by giving such enterprises increased support in loans and providing, within a given period of time, small loans, etc. to support persons who start undertakings independently.

Article 20 The State applies an employment policy whereby to make overall plans for both urban and rural areas, establishes a sound system under which to provide equal job opportunities to both urban and rural people and give guidance to the surplus agricultural workers in their effort to find other jobs in an orderly manner.

　　Local people's governments at or above the county level shall push forward the development of small towns (townships), accelerate the regional economic development of the counties, and give guidance to the surplus agricultural workers in their efforts to find other jobs at or near the places where they live. When formulating plans for small towns (townships), they shall include in the plans the employment of the surplus agricultural workers of their respective areas in other jobs as an important task.

Local people's governments at or above the county level shall give guidance to the surplus agricultural workers in going to the urban areas for employment in an orderly manner. The people's governments where workers are exported and imported shall cooperate with each other in improving the employment environment and conditions for rural people to find jobs in the urban areas.

　　Article 21 The State supports the development of regional economy, encourages cooperation between different regions and comprehensively coordinate the efforts for balanced increase of employment in different areas.

The State supports ethnic minority areas in their efforts to develop the economy and increase employment.

Article 22 People's governments at all levels shall make overall plans for the employment of the new-arising workforce in cities and towns, of the surplus agricultural workers in other jobs, and for the re-employment of the unemployed.

Article 23 People's governments at all levels shall take measures to gradually improve and implement the labor and social insurance policies adapted to such flexible employment as part-time jobs, in order to provide assistance and services to the persons who look for flexible employment.

Article 24 Local people's governments at all levels and the relevant departments shall give better guidance to the unemployed in starting self-employed businesses, and provide them with policy consultation, vocational training, instructions on how to start a business and other services.

Chapter III  Fair Employment

Article 25 People's governments at all levels shall create an environment for fair employment, eliminate discrimination in employment, and formulate policies and take measures to support and aid the persons who have difficulty in finding jobs.

Article 26 When an employing unit recruits persons or when a job intermediary engages in intermediary activities, it shall provide persons with equal opportunities and fair conditions for employment, and it shall not discriminate against anyone in this respect.

　　Article 27 The State guarantees that women enjoy equal right to work as men.

　　When an employing unit recruits persons, it shall not refuse to employ women or raise recruitment standards for females by using gender as an excuse, except where the types of work or posts are not suitable for women as prescribed by the State.

When an employing unit recruits female workers, it shall not have such provisions as restrict female workers from getting married or bearing a child included in the labor contract.

　　Article 28 The peoples of all ethnic groups enjoy equal right to work.

When an employing unit recruits persons, it shall give appropriate considerations to the persons of ethnic minorities in accordance with law.

　　Article 29 The State guarantees the disabled persons' right to work.

　　People's governments at all levels shall make overall plans for the employment of the disabled and create conditions for their employment.

When an employing unit recruits persons, it shall not discriminate against disabled persons.

Article 30 When an employing unit recruits a person, it shall not use as a pretext that he is a pathogen carrier of an infectious disease to refuse to employ him. However, before a pathogen carrier of an infectious disease is confirmed upon medical test that he is cured or before the suspicion that the disease is infections is expelled, he shall not take up the kind of jobs which may easily cause the disease to spread and which a person is prohibited from taking up by laws and administrative regulations and by the administrative department of health under the State Council.

Article 31 Rural workers who go to cities for employment shall enjoy equal right to work as urban workers do. No discriminating restrictions may be placed on the rural workers who go to cities for employment.

Chapter IV  Employment Services and Management

Article 32 People's governments at or above the county level shall foster and improve a unitary, open, competitive and orderly market for human resources to provide services to the workers for employment.

Article 33 People's governments at or above the county level shall encourage all sectors of the society to carry out activities in the service of employment in accordance with law, provide better guidance in and exercise stricter supervision over public services for employment and the services provided by job intermediaries and gradually improve the employment service system covering urban and rural areas.

Article 34 People's governments at or above the county level shall intensify the development of information networks and relevant facilities for the market of human resources, establish a sound information service system for such market, and improve the system for dissemination of market information.

　　Article 35 People's governments at or above the county level shall establish a sound system to provide public services for employment, set up public service agencies for employment and provide the following services to the workers gratis:

　　(1) consultation on employment policies and regulations；

　　(2) release of information about supply and demand of jobs, guidance rates of wages on the market, and vocational training；

　　(3) vocational guidance and job recommendation；

　　(4) employment aid to people who have difficulty in finding jobs；

(5) registration of employment and unemployment, etc.；

　　(6) other public services for employment.

　　A public service agency for employment shall constantly improve the quality and increase the efficiency of its services and shall not engage in any profit-making activities.

The funds for public services for employment shall be incorporated into the government budget at the same level.

　　Article 36 People's governments at or above the county level shall, according to the relevant regulations, subsidize the job intermediaries which provide public welfare services for employment.

The State encourages all circles of the society to make donations and provide financial aid to the public welfare service for employment.

　　Article 37 No local people's government at any level and no relevant department may set up any profit-making job intermediary or do so jointly with another.

No local people's government at any level, no relevant department or public service agency for employment may collect fees from people who attend job fairs held by it.

Article 38 People's governments at or above the county level and the relevant departments shall enhance the administration of job intermediaries, encourage them to improve the quality of their services and bring into play their role in the promotion of employment.

　　Article 39 The principles of lawfulness, good faith, fairness and openness shall be observed in intermediary activities for employment.

　　When an employing unit recruits persons via a job intermediary, it shall provide the intermediary with truthful information about its demand for jobs.

All organizations and individuals are prohibited from infringing on the legitimate rights and interests of the workers by taking advantage of their intermediary activities for employment.

　　Article 40 For establishment of a job intermediary, the following conditions shall be met:

　　(1) having a definite charter and rules of management；

　　(2) having fixed premises, office facilities and a certain amount of startup funds, which are essential to the business；

　　(3) having a certain number of full-time staff members armed with the appropriate professional qualifications；

　　(4) other conditions prescribed by laws and regulations.

　　For establishment of a job intermediary, administrative permission shall be applied for in accordance with law. The job intermediary that obtains such permission shall register with the administrative department for industry and commerce.

　　No institution that has not obtained permission and registered in accordance with law may engage in job intermediary activities.

If where are regulations separately formulated by the State with respect to the job intermediaries that are funded by foreign investment or that offer to people overseas employment services, the provisions there shall prevail.

　　Article 41 No job intermediary may do any of the following:

(1)providing false employment information；

　　(2)offering job intermediary services to any employing unit that does not have a lawful license；

　　(3)counterfeiting, tampering with or transferring the permit of job intermediary；

　　(4)taking away a worker's resident identity card or other certificates, or charging a deposit from the worker；

(5)other acts in violation of the provisions of laws or regulations.

Article 42 People's governments at or above the county level shall establish an unemployment alert system to prevent, regulate and control potential large-scale unemployment.

　　Article 43 The State establishes a statistical system for workforce survey and a system for employment and unemployment registration, in order to conduct statistical survey of the workforce resources and of the status of employment and unemployment and publish the statistical findings.

When statistics departments and administrative departments of labor conduct statistical survey of the workforce and registration of employment and unemployment, the employing units and individuals shall provide truthful information required for statistical survey and registration.

Chapter V  Vocational Education and Training

Article 44 The State develops vocational education in accordance with law, promotes vocational training and encourages the workers to raise the level of their vocational skills and to increase their employability and capability of starting undertakings.

Article 45 People's governments at or above the county level shall, in light of the need of economic and social development and market demand, formulate and implement plans for the development of vocational capabilities.

Article 46 People's governments at or above the county level shall improve coordination under an overall plan, encourage and support various types of vocational colleges and schools, vocational skills training institutions and employing units to, in accordance with law, provide pre-employment training, on-the-job training, re-employment training and training for starting undertakings, and shall encourage the workers to participate in various forms of training.

　　Article 47 Local people's governments at or above the county level and the relevant departments shall, in light of the market demand and the trend of industrial development, encourage enterprises to do a better job in vocational education and training and give them guidance in this endeavor.

　　Vocational colleges and schools and vocational skills training institutions shall keep close ties with enterprises, in order to combine teaching with production, serve economic development, and to cultivate people for practical use and skilled workers.

An enterprise shall allocate funds for their workers' education according to the relevant regulations of the State, in order to carry out vocational skill training and continued education among the workers.

Article 48 The State takes measures to establish a sound labor reserve system. Local people's governments at or above the county level shall provide a certain period of vocational education and training to the graduates from junior and senior middle schools who need to find jobs, in order to enable them to acquire the relevant vocational qualifications or the skills of certain professions.

Article 49 Local people's governments at all levels shall encourage and support employment training, help the unemployed to upgrade their vocational skills and increase their employability and their capability of starting undertakings. The unemployed who participate in such training shall, in accordance with relevant regulations, be entitled to receive the training subsidies provided by the governments.

Article 50 Local people's governments at all levels shall take effective measures to make arrangement for and give guidance to the rural workers who go to cities for employment to participate in skill training in this respect, and encourage various types of training institutions to provide skill training to such rural workers to increase their employability and capability of starting undertakings.

Article 51 The State applies a vocational certification system to the workers who are engaged in such special types of work as those involving public security, human health, safety of people's lives and property. The specific measures in this respect shall be formulated by the State Council.

Chapter VI  Employment Aid

Article 52 People's governments at all levels shall establish a sound employment aid system and, in their support and assistance, give priority to the persons who have difficulty in finding jobs, by means of exemption and deduction of taxes and fees, discount interest loans, social insurance subsidies, post subsidies, by providing public welfare jobs and through other channels.

By persons who have difficulty in finding jobs are meant those persons who have difficulty in getting employed because of their physical condition, level of skills, family factor, loss of land, etc., or who cannot get re-employed after being unemployed for a continuous period of time. The specific range of persons who have difficulty in finding jobs shall be separately defined by the people's governments of provinces, autonomous regions and municipalities directly under the Central Government in light of the actual conditions of their respective administrative areas.

Article 53 The public welfare jobs which are created through government investment shall first be offered to the persons who have difficulty in finding jobs and meet the requirements of such jobs. The persons who get such jobs shall be given post subsidies according to the regulations of the State.

Article 54 Local people's governments at all levels shall improve their service in respect of employment aid at the grass-roots level, place emphasis on assisting the persons who have difficulty in finding jobs and offer them employment services and aid related to public welfare jobs that are suited to them.

Local people's governments at all level shall encourage and support the various sectors of the society to provide skill training, job information and other services to the persons who have difficulty in finding jobs.

　　Article 55 People's governments at all levels shall take special supportive measures to promote the employment of disabled persons.

An employing unit shall arrange the employment of disabled persons according to the regulations of the State. The specific measures in this respect shall be formulated by the State Council.

　　Article 56 Local people's governments at or above the county level shall adopt diversified forms of employment, expand the range of public welfare posts, create job opportunities, and ensure that at least one member is employed in each urban family that needs employment.

Where all the members of a family who have reached the statutory working age are unemployed, they may apply for employment aid to the public service for employment of the neighborhood or community where they live. The said public service for employment shall, upon verification, provide a suitable job to one member of the family at least.

　　Article 57 The State encourages the cities open to resources exploitation and the independent industrial and mining areas to develop industries that meet market demand and guide people to find jobs in these industries.

To the areas where it becomes difficult for a large number of persons to find jobs because the resources there are exhausted or the structure of the economy is readjusted, or for other reasons, the people's governments at a higher level shall provide the necessary support and assistance.

Chapter VII  Supervision and Inspection

Article 58 People's governments at all levels and the relevant departments shall establish target responsibility system for promotion of employment. The people's governments at or above the county level shall, on the basis of the requirements of such a system, assess and supervise the work of its subordinate departments and the people's governments at the next lower level.

Article 59 The audit organs and finance departments shall, in accordance with law, supervise and inspect the management and use of the special funds for employment.

Article 60 The administrative department of labor shall supervise and inspect the implementation of this Law and establish a reporting system to accept reports on violations of this Law, and shall verify and handle such violations in a timely manner.

Chapter VIII  Legal Responsibility

Article 61 Where the administrative departments of labor or other relevant departments or their members abuse their power, neglect their duties or engage in malpractices for personal gain in violation of the provisions of this Law, the leading persons directly in charge and the other persons directly responsible shall be given sanctions in accordance with law.

Article 62 Where anyone practices discrimination in employment in violation of the provisions of this Law, the workers concerned may lodge a lawsuit in the people's court.

Article 63 Where, in violation of the provisions of this Law, a local people's government, a relevant department or public service for employment establishes a profit-making job intermediary, or engages in profit-making job intermediary activities, or collect fees from the workers, the department in charge at a higher level shall order it to make rectification within a time limit and to return to the workers the fees illegally collected, and shall, in accordance with law, give sanctions to the leading persons who are directly in charge and the other persons who are directly responsible.

Article 64 Where any unit or individual, in violation of the provisions of this Law, starts a job intermediary without obtaining permission or registration, the administrative department of labor or other departments in charge shall have it closed down in accordance with law, and shall confiscate the illegal gains, if any, and impose on it/him a fine of not less than RMB 10,000 yuan but not more than 50,000 yuan.

Article 65 Where a job intermediary, in violation of the provisions of this Law, provides false employment information, provides intermediary services for employment to any employing unit that does not have a lawful license, or forges, tampers with or transfers the job intermediary permit, the administrative department of labor or other departments in charge shall order it to make rectification, confiscate its illegal gains, if any, and impose on it a fine of not less than 10,000 yuan but not more than 50,000 yuan, or, if the circumstances are serious, revoke its permit for job intermediary activities.

Article 66 Where a job intermediary takes away the resident identity card or other certificate of a worker in violation of the provisions of this Law, the administrative department of labor shall order it to return it to the worker within a time limit and shall punish it in accordance with provisions of relevant laws.

Where a job intermediary collects any deposit from the workers in violation of the provisions of this Law, the administrative department of labor shall order it to return the deposit to the workers within a time limit and shall impose on it a fine of not less than 500 yuan but not more than 2,000 yuan for each person from whom it collects a deposit.

Article 67 Where an enterprise, in violation of the provisions of this Law, fails to allocate funds for workers' education according to State regulations or misappropriates such funds, the administrative department of labor shall order it to make rectification and shall punish it in accordance with law.

Article 68 Where anyone, in violation of the provisions of this Law, infringes on the lawful rights and interests of the workers, thus causing property losses or other damages, he shall bear civil liabilities in accordance with law； if a crime is constituted, he shall be investigated for criminal responsibilities in accordance with law. Chapter IX

Supplementary Provisions

Article 69 This Law shall go into effect as of January 1, 2008

Annex 2

Law of the People's Republic of China on Employment Contracts

    (Adopted at the 28th Session of the Standing Committee of the 10th National People's Congress on June 29, 2007)

    Chapter 1 General Provisions 
    Article 1 This Law has been formulated in order to improve the employment contract system, to specify the rights and obligations of the parties to employment contracts, to protect the lawful rights and interests of Employees and to build and develop harmonious and stable employment relationships.
    Article 2 This Law governs the establishment of employment relationships between, and the conclusion, performance, amendment, termination and ending of employment contracts by, organizations such as enterprises, individual economic organizations and private non-enterprise units in the People’s Republic of China (“Employers”) on the one hand and Employees in the People’s Republic of China on the other hand.
    The conclusion, performance, amendment, termination and ending of employment contracts by state authorities, institutions or social organizations on the one hand and Employees with whom they establish employment relationships on the other hand, shall be handled pursuant to this Law.
    Article 3 The conclusion of employment contracts shall comply with the principles of lawfulness, fairness, equality, free will, negotiated consensus and good faith.
    A lawfully concluded employment contract is binding, and both the Employer and the Employee shall perform their respective obligations stipulated therein.
    Article 4  Employers shall establish and improve internal rules and regulations, so as to ensure that Employees enjoy their labor rights and perform their labor obligations.
    When an Employer formulates, revises or decides on rules and regulations, or material matters, that have a direct bearing on the immediate interests of its Employees, such as those concerning compensation, work hours, rest, leave, work safety and hygiene, insurance, benefits, employee training, work discipline or work quota management, the same shall be discussed by the employee representative congress or all the employees. The employee representative congress or all the employees, as the case may be, shall put forward a proposal and comments, whereupon the matter shall be determined through consultations with the Trade union or employee representatives conducted on a basis of equality.
    If, during the implementation of an Employer’s rule or regulation or decision on a crucial matter, the Trade union or an employee is of the opinion that the same is inappropriate, it or he is entitled to communicate such opinion to the Employer, and the rule, regulation or decision shall be improved by making amendments after consultations.
    Rules and regulations, and decisions on material matters, that have a direct bearing on the immediate interests of Employees shall be made public or be communicated to the Employees by the Employer.
    Article 5 The labor administration authorities of People’s Governments at the county level and above, together with the Trade union and enterprise representatives, shall establish a comprehensive tri-partite mechanism for the coordination of employment relationships, in order to jointly study and resolve major issues concerning employment relationships.
    Article 6  A Trade union shall assist and guide Employees in the conclusion of employment contracts with their Employer and the performance thereof in accordance with the law, and establish a collective bargaining mechanism with the Employer in order to safeguard the lawful rights and interests of Employees.
    Chapter 2 Conclusion of Employment Contracts

Article 7 An Employer’s employment relationship with a Employee is established on the date it starts using the Employee. An Employer shall keep a register of employees, for reference purposes.


    Article 8 When an Employer hires a Employee, it shall truthfully inform him as to the content of the work, the working conditions, the place of work, occupational hazards, production safety conditions, labor compensation and other matters which the Employee requests to be informed about. The Employer has the right to learn from the Employee basic information which directly relates to the employment contract, and the Employee shall truthfully provide the same.

    Article 9  When hiring a Employee, an Employer may not retain the Employee’s resident ID card or other papers, nor may it require him to provide security or collect property from him under some other guise.

    Article 10 To establish an employment relationship, a written employment contract shall be concluded.
    In the event that no written employment contract was concluded at the time of establishment of an employment relationship, a written employment contract shall be concluded within one month after the date on which the Employer starts using the Employee.
    Where an Employer and a Employee conclude an employment contract before the Employer starts using the Employee, the employment relationship shall be established on the date on which the Employer starts using the Employee.

    Article 11 In the event that an Employer fails to conclude a written employment contract with a Employee at the time its starts to use him, and it is not clear what labor compensation was agreed upon with the Employee, the labor compensation of the new Employee shall be decided pursuant to the rate specified in the collective contract; where there is no collective contract or the collective contract is silent on the matter, equal pay shall be given for equal work.

    Article 12 Employment contracts are divided into fixed-term employment contracts, open-ended employment contracts and employment contracts to expire upon completion of a certain job.

    Article 13 A “fixed-term employment contract” is an employment contract whose ending date is agreed upon by the Employer and the Employee.
    An Employer and a Employee may conclude a fixed-term employment contract upon reaching a negotiated consensus.
 

Article 14 An “open-ended employment contract” is an employment contract for which the Employer and the Employee have agreed not to stipulate a definite ending date.
    An Employer and a Employee may conclude an open-ended employment contract upon reaching a negotiated consensus. If a Employee proposes or agrees to renew his employment contract or to conclude an employment contract in any of the following circumstances, an open-ended employment contract shall be concluded, unless the Employee requests the conclusion of a fixed-term employment contract:
    (1) The Employee has been working for the Employer for a consecutive period of not less than 10 years;
    (2) when his Employer introduces the employment contract system or the state owned enterprise that employs him re-concludes its employment contracts as a result of restructuring, the Employee has been working for the Employer for a consecutive period of not less than 10 years and is less than 10 years away from his legal retirement age; or
    (3) prior to the renewal, a fixed-term employment contract was concluded on two consecutive occasions and the Employee is not characterized by any of the circumstances set forth in Article 39 and items (1) and (2) of Article 40 hereof.
    If an Employer fails to conclude a written employment contract with a Employee within one year from the date on which it starts using the Employee, the Employer and the Employee shall be deemed to have concluded an open-ended employment contract.

    Article 15 An “employment contract with a term to expire upon completion of a certain job” is an employment contract in which the Employer and the Employee have agreed that the completion of a certain job is the term of the contract.
    An Employer and a Employee may, upon reaching a negotiated consensus, conclude an employment contract with a term to expire upon completion of a certain job.

Article 16 An employment contract shall become effective when the Employer and the Employee have reached a negotiated consensus thereon and each of them has signed or sealed the text of such contract.
    The Employer and the Employee shall each hold one copy of the employment contract.

    Article 17 An employment contract shall specify the following matters:
    (1) The name, domicile and legal representative or main person in charge of the Employer;
    (2) The name, domicile and number of the resident ID card or other valid identity document of the Employee;
    (3) The term of the employment contract;
    (4) The job des cription and the place of work;
    (5) Working hours, rest and leave;
    (6) Labor compensation;
    (7) Social insurance;
    (8) Labor protection, working conditions and protection against occupational hazards; and
    (9) Other matters which laws and statutes require to be included in employment contracts.
    In addition to the requisite terms mentioned above, an Employer and a Employee may agree to stipulate other matters in the employment contract, such as probation period, training, confidentiality, supplementary insurance and benefits, etc.

     Article 18 If a dispute arises due to the fact that the rate or standards for labor compensation or working conditions, etc. are not explicitly specified in the employment contract, the Employer and the Employee may renegotiate. If the negotiations are unsuccessful, the provisions of the collective contract shall apply. If there is no collective contract or the collective contract is silent on the issue of labor compensation, equal pay shall be given for equal work; if there is no collective contract or the collective contract is silent on the issue of working conditions, the relevant regulations of the state shall apply.


     Article 19 If an employment contract has a term of not less than three months but less than one year, the probation period may not exceed one month; if an employment contract has a term of more than one year and less than three years, the probation period may not exceed two months; and if an employment contract has a term of not less than three years or is open-ended, the probation period may not exceed six months.
     An Employer may stipulate only one probation period with any given Employee.
     No probation period may be specified in an employment contract with a term to expire upon completion of a certain job or an employment contract with a term of less than three months.
     The probation period shall be included in the term of the employment contract. If an employment contract provides for a probation period only, then there is no probation period and the term concerned shall be the term of the employment contract.

     Article 20 The wages of a Employee on probation may not be less than the lowest wage level for the same job with the Employer or less than 80 percent of the wage agreed upon in the employment contract, and may not be less than the minimum wage rate in the place where the Employer is located.

     Article 21 An Employer may not terminate an employment contract during the probation period unless the Employee is characterized by any of the circumstances set forth in Article 39 and items (1) and (2) of Article 40 hereof. If an Employer terminates an employment contract during the probation period, it shall explain the reasons to the Employee.

     Article 22 If an Employer provides special funding for a Employee’s training and gives him professional technical training, it may conclude an agreement specifying a term of service with such Employee.
     If the Employee breaches the agreement on the term of service, he shall pay liquidated damages to the Employer as agreed. The measure of the liquidated damages may not exceed the training expenses paid by the Employer. The liquidated damages that the Employer requires the Employee to pay may not exceed the portion of the training expenses allocable to the unperformed portion of the term of service.
     The reaching of agreement on a term of service between the Employer and the Employee does not affect the raising of the Employee’s labor compensation during the term of service according to the normal wage adjustment mechanism.

     Article 23 An Employer and a Employee may include in their employment contract provisions on confidentiality matters relating to maintaining the confidentiality of the trade secrets of the Employer and to intellectual property.

If a Employee has a confidentiality obligation, the Employer may agree with the Employee on competition restriction provisions in the employment contract or confidentiality agreement, and stipulate that the Employer shall pay financial compensation to the Employee on a monthly basis during the term of the competition restriction after the termination or ending of the employment contract. If the Employee breaches the competition restriction provisions, he shall pay liquidated damages to the Employer as stipulated.

     Article 24 The personnel subject to competition restrictions shall be limited to the Employer’s senior management, senior technicians and other personnel with a confidentiality obligation. The scope, territory and term of the competition restrictions shall be agreed upon by the Employer and the Employee, and such agreement shall not violate laws and regulations.
     The term, counted from the termination or ending of the employment contract, for which a person as mentioned in the preceding paragraph is subject to competition restrictions in terms of his working for a competing Employer that produces the same type of products or is engaged in the same type of business as his current Employer, or in terms of his establishing his own business to produce the same type of products or engage in the same type of business, shall not exceed two years.

     Article 25 With the exception of the circumstances specified in Articles 22 and 23 hereof, an Employer may not stipulate with a Employee provisions on the bearing of liquidated damages by the Employee.

     Article 26 An employment contract shall be invalid or partially invalid if:
    (1) A party uses such means as deception or coercion, or takes advantage of the other party’s difficulties, to cause the other party to conclude an employment contract, or to make an amendment thereto, that is contrary to that party’s true intent;
    (2) The Employer disclaims its legal liability or denies the Employee his rights; or
    (3) Mandatory provisions of laws or administrative statutes are violated.
    If the invalidity or partial invalidity of the employment contract is disputed, it shall be confirmed by a labor dispute arbitration institution or a People’s Court.

    Article 27 If certain provisions of an employment contract are invalid and such invalidity does not affect the validity of the remaining provisions, the remaining provisions shall remain valid.

    Article 28 If an employment contract is confirmed as invalid and the Employee has already performed labor, the Employer shall pay the Employee labor compensation. The amount of labor compensation shall be determined with reference to the labor compensation of Employees in the same or a similar position with the Employer.

    Chapter 3 Performance and Amendment of Employment Contracts


    Article 29 The Employer and the Employee shall each fully perform its/his obligations in accordance with the employment contract.

    Article 30 Employers shall pay their Employees labor compensation on time and in full in accordance with the employment contracts and state regulations.
    If an Employer falls into arrears with the payment of labor compensation or fails to make payment in full, the Employee may, in accordance with the law, apply to the local People’s Court for an order to pay; and the People’s Court shall issue such order in accordance with the law.

 

Article 31 Employers shall strictly implement the work quota standards and may not compel or in a disguised manner compel Employees to work overtime. If an Employer arranges for a Employee to work overtime, it shall pay him overtime pay in accordance with the relevant state regulations.

    Article 32 Employees shall not be held in breach of their employment contracts if they refuse to perform dangerous operations that are instructed in violation of regulations or peremptorily ordered by management staff of the Employer.
    Employees have the right to criticize, report to the authorities or lodge accusations against their Employers in respect of working conditions that endanger their lives or health.

    Article 33 Changes such a change in the name, legal representative or main person in charge of, or an (the) investor(s) in, an Employer shall not affect the performance of its employment contracts.

    Article 34 If an Employer is merged or divided, etc., its existing employment contracts shall remain valid and continue to be performed by the Employer(s) which succeeded to its rights and obligations

    Article 35 An Employer and a Employee may amend the provisions of their employment contract if they so agree after consultations. Amendments to an employment contract shall be made in writing.
    The Employer and the Employee shall each hold one copy of the amended employment contract.

    Chapter 4 Termination and Ending of Employment Contracts

 

Article 36 An Employer and a Employee may terminate their employment contract if they so agree after consultations.

    Article 37 A Employee may terminate his employment contract upon 30 days’ prior written notice to his Employer. During his probation period, a Employee may terminate his employment contract by giving his Employer three days’ prior notice.

    Article 38 A Employee may terminate his employment contract if his Employer:
    (1) Fails to provide the labor protection or working conditions specified in the employment contract;
    (2) Fails to pay labor compensation in full and on time;
    (3) Fails to pay the social insurance premiums for the Employee in accordance with the law;
    (4) Has rules and regulations that violate laws or regulations, thereby harming the Employee’s rights and interests;
    (5) causes the employment contract to be invalid due to a circumstance specified in the first paragraph of Article 26 hereof;
    (6) Gives rise to another circumstance in which laws or administrative statutes permit a Employee to terminate his employment contract.
    If an Employer uses violence, threats or unlawful restriction of personal freedom to compel a Employee to work, or if a Employee is instructed in violation of rules and regulations or peremptorily ordered by his Employer to perform dangerous operations which threaten his personal safety, the Employee may terminate his employment contract forthwith without giving prior notice to the Employer.

    Article 39 An Employer may terminate an employment contract if the Employee:
    (1) Is proved during the probation period not to satisfy the conditions for employment;
    (2) Materially breaches the Employer’s rules and regulations;
    (3) Commits serious dereliction of duty or practices graft, causing substantial damage to the Employer;
    (4) has additionally established an employment relationship with another Employer which materially affects the completion of his tasks with the first-mentioned Employer, or he refuses to rectify the matter after the same is brought to his attention by the Employer;
    (5) causes the employment contract to be invalid due to the circumstance specified in item (1) of the first paragraph of Article 26 hereof; or
    (6) Has his criminal liability pursued in accordance with the law.

    Article 40 An Employer may terminate an employment contract by giving the Employee himself 30 days’ prior written notice, or one month’s wage in lieu of notice, if:
    (1) after the set period of medical care for an illness or non-work-related injury, the Employee can engage neither in his original work nor in other work arranged for him by his Employer;
    (2) The Employee is incompetent and remains incompetent after training or adjustment of his position; or
    (3) A major change in the objective circumstances relied upon at the time of conclusion of the employment contract renders it unperformable and, after consultations, the Employer and Employee are unable to reach agreement on amending the employment contract.

    Article 41 If any of the following circumstances makes it necessary to reduce the workforce by 20 persons or more or by a number of persons that is less than 20 but accounts for 10 percent or more of the total number of the enterprise’s employees, the Employer may reduce the workforce after it has explained the circumstances to its Trade union or to all of its employees 30 days in advance, has considered the opinions of the Trade union or the employees and has subsequently reported the workforce reduction plan to the labor administration department:

(1) Restructuring pursuant to the Enterprise Bankruptcy Law;
(2) Serious difficulties in production and/or business operations;

(3)The enterprise switches production, introduces a major technological innovation or revises its business method, and, after amendment of employment contracts, still needs to reduce its workforce; or
    (4) Another major change in the objective economic circumstances relied upon at the time of conclusion of the employment contracts, rendering them unperformable.
    When reducing the workforce, the Employer shall retain with priority persons:
    (1) Who have concluded with the Employer fixed-term employment contracts with a relatively long term;
    (2) Who have concluded open-ended employment contracts with the Employer; or
    (3) Who are the only ones in their families to be employed and whose families have an elderly person or a minor for whom they need to provide.
    If an Employer that has reduced its workforce pursuant to the first paragraph hereof hires again within six months, it shall give notice to the persons dismissed at the time of the reduction and, all things being equal, hire them on a preferential basis.

    Article 42 An Employer may not terminate an employment contract pursuant to Article 40 or Article 41 hereof if the Employee:
    (1) is engaged in operations exposing him to occupational disease hazards and has not undergone a pre-departure occupational health check-up, or is suspected of having contracted an occupational disease and is being diagnosed or under medical observation;
    (2) Has been confirmed as having lost or partially lost his capacity to work due to an occupational disease contracted or a work-related injury sustained with the Employer;
    (3) Has contracted an illness or sustained a non-work-related injury, and the set period of medical care therefore has not expired;
    (4) Is a female employee in her pregnancy, confinement or nursing period;
    (5) Has been working for the Employer continuously for not less than 15 years and is less than 5 years away from his legal retirement age;
    (6) Finds himself in other circumstances stipulated in laws or administrative statutes.

    Article 43 When an Employer is to terminate an employment contract unilaterally, it shall give the Trade union advance notice of the reason therefore. If the Employer violates laws, administrative statutes or the employment contract, the Trade union has the right to demand that the Employer rectify the matter. The Employer shall study the Trade union’s opinions and notify the Trade union in writing as to the outcome of its handling of the matter.
 

Article 44 An employment contract shall end if:

(1) Its term expires;

(2)The Employee has commenced drawing his basic old age insurance pension in accordance with the law;
    (3) The Employee dies, or is declared dead or missing by a People’s Court;
    (4) The Employer is declared bankrupt;
    (5) The Employer has its business license revoked, is ordered to close or is closed down, or the Employer decides on early liquidation;
    (6) Another circumstance specified in laws or administrative statutes arises.

    Article 45 If an employment contract expires and any of the circumstances specified in Article 42 hereof applies, the term of the employment contract shall be extended until the relevant circumstance ceases to exist, at which point the contract shall end. However, matters relating to the ending of the employment contract of a Employee who has lost or partially lost his capacity to work as specified in item (2) of Article 42 hereof shall be handled in accordance with state regulations on work-related injury insurance.

 

Article 46 In any of the following circumstances, the Employer shall pay the Employee severance pay:
    (1) The employment contract is terminated by the Employee pursuant to Article 38 hereof;
    (2) The employment contract is terminated after such termination was proposed to the Employee by the Employer pursuant to Article 36 hereof and the parties reached agreement thereon after consultations;
    (3) The employment contract is terminated by the Employer pursuant to Article 40 hereof;
    (4) The employment contract is terminated by the Employer pursuant to the first paragraph of Article 41 hereof;
    (5) The employment contract is a fixed–term contract that ends pursuant to item (1) of Article 44 hereof, unless the Employee does not agree to renew the contract even though the conditions offered by the Employer are the same as or better than those stipulated in the current contract;
    (6) The employment contract ends pursuant to item (4) or (5) of Article 44 hereof;
    (7) Other circumstances specified in laws or administrative statutes.

    Article 47 A Employee shall be paid severance pay based on the number of years worked with the Employer at the rate of one month’s wage for each full year worked. Any period of not less than six months but less than one year shall be counted as one year. The severance pay payable to a Employee for any period of less than six months shall be one-half of his monthly wages.
    If the monthly wage of a Employee is greater than three times the average monthly wage of employees in the Employer’s area as published by the People’s Government at the level of municipality directly under the central government or municipality divided into districts of the area1 where the Employer is located, the rate for the severance pay paid to him shall be three times the average monthly wage of employees and shall be for not more than 12 years of work.
    For the purposes of this Article, the term “monthly wage” means the Employee’s average monthly wage for the 12 months prior to the termination or ending of his employment contract.

    Article 48 If an Employer terminates or ends an employment contract in violation of this Law and the Employee demands continued performance of such contract, the Employer shall continue performing the same. If the Employee does not demand continued performance of the employment contract or if continued performance of the employment contract has become impossible, the Employer shall pay damages pursuant to Article 87 hereof.

    Article 49 The state will take measures to establish a comprehensive system that enables Employees’ social insurance accounts to be transferred from one region to another and to be continued in such other region.

    Article 50 At the time of termination or ending of an employment contract, the Employer shall issue a proof of termination or ending of the employment contract and, within 15 days, carry out the procedures for the transfer of the Employee’s file and social insurance account.
    The Employee shall carry out the procedures for the handover of his work as agreed by the parties. If relevant provisions of this Law require the Employer to pay severance pay, it shall pay the same upon completion of the procedures for the handover of the work.
    The Employer shall keep terminated or ended employment contracts on file for not less than two years, for reference purposes.

   

Chapter 5 Special Provisions

 

Section1 Collective Contract
   
    Article 51 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. 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 Trade union, on behalf of the enterprise’s employees, and the Employer. If the Employer does not yet have a Trade union, it shall 1 Translator’s note: The phrase “of the area” does not appear in the Chinese text. It has been added by us in view of the context.
    Conclude the collective contract with a representative put forward by the Employees under the guidance of the Trade union at the next higher level.

    Article 52 Enterprise employees, as one party, and their Employer may enter into specialized collective contracts addressing labor safety and hygiene, protection of the rights and interests of female employees, the wage adjustment mechanism, etc.

    Article 53 Industry-wide or area-wide collective contracts may be concluded between the Trade union on the one hand and representatives on the side of the enterprises on the other hand in industries such as construction, mining, catering services, etc. within areas below the county level.

    Article 54 After a collective contract has been concluded, it shall be submitted to the labor administration authority. The collective contract shall become effective upon the lapse of 15 days from the date of receipt thereof by the labor administration authority, unless the said authority raises any objections to the contract.
    A collective contract that has been concluded in accordance with the law is binding on the Employer and the Employees. An industry-wide or area-wide collective contract is binding on Employers and Employees in the industry or in the area in the locality concerned.

    Article 55 The rates for labor compensation, standards for working conditions, etc. stipulated in a collective contract may not be lower than the minimum rates and standards prescribed by the local People’s Government. The rates for labor compensation, standards for working conditions, etc. stipulated in the employment contract between an Employer and a Employee may not be lower than those stipulated in the collective contract.

    Article 56 If an Employer’s breach of the collective contract infringes upon the labor rights and interests of the employees, the Trade union may, in accordance with the law, demand that the Employer assume liability. If a dispute arising from the performance of the collective contract is not resolved following consultations, the Trade union may apply for arbitration and institute an action according to law.

 

Section 2 Placement

    Article 57 Staffing firms shall be established in accordance with the relevant provisions of the Company Law and have registered capital of not less than RMB￥500,000.

    Article 58 Staffing firms are Employers as mentioned in this Law and shall perform an Employer’s obligations toward its Employees. The employment contract between a staffing firm and a Employee to be placed shall, in addition to the matters specified in Article 17 hereof, specify matters such as the unit with which the Employee will be placed, the term of his placement, his position, etc.
    The employment contracts between staffing firms and the Employees to be placed shall be fixed term employment contracts with a term of not less than two years. Staffing firms shall pay labor compensation on a monthly basis. During periods when there is no work for Employees to be placed, the staffing firm shall pay such Employees compensation on a monthly basis at the minimum wage rate prescribed by the People’s Government of the place where the staffing firm is located.

    Article 59 When placing Employees, staffing firms shall enter into staffing agreements with the units that accept the Employees under the placement arrangements (“Accepting Units”). The staffing agreements shall stipulate the job positions in which Employees are placed, the number of persons placed, the term of placement, the amounts and methods of payments of labor compensation and social insurance premiums, and the liability for breach of the agreement.
    An Accepting Unit shall decide with the staffing firm on the term of placement based on the actual requirements of the job position, and it may not conclude several short-term placement agreements to cover a continuous term of labor use.

    Article 60 Staffing firms shall inform the Employees placed of the content of the placement agreements.
    Staffing firms may not pocket part of the labor compensation that the Accepting Units pay to the Employees in accordance with the placement agreement.
    Staffing firms and the Accepting Units may not charge fees from the Employees placed.

    Article 61 If a staffing firm places a Employee with an Accepting Unit in another region, the Employee’s labor compensation and working conditions shall be in line with the rates and standards of the place where the Accepting Unit is located.

   Article 62 Accepting Units shall perform the following obligations:
   (1) Implement state labor standards and provide the corresponding working conditions and labor protection;
   (2) communicate the job requirements and labor compensation of the Employees placed;
   (3) Pay overtime pay and performance bonuses and provide benefits appropriate for the job positions;
   (4) Provide the placed Employees who are on the job with the training necessary for their job positions; and
   (5) In case of continuous placement, implement a normal wage adjustment system.
    Accepting Units may not in turn place the Employees with other Employers.

    Article 63 Placed Employees shall have the right to receive the same pay as that received by Employees of the Accepting Unit for the same work. If an Accepting Unit has no Employee in the same position, the labor compensation shall be determined with reference to the labor compensation paid in the place where the Accepting Unit is located to Employees in the same or a similar position.

    Article 64 Placed Employees have the right to lawfully join the Trade union of their staffing firm or the Accepting Unit or to organize such unions, so as to protect their own lawful rights and interests.

    Article 65 Placed Employees may terminate their employment contracts with their staffing firms pursuant to Article 36 or 38 hereof.
    If any of the circumstances provided for in Article 39 and items (1) and (2) of Article 40 hereof applies to a placed Employee, his Accepting Unit may return him to the staffing firm, which may terminate its employment contract with him in accordance with the relevant provisions of this Law.

    Article 66 The placement of Employees shall generally be practiced for temporary, auxiliary or substitute job positions.

    Article 67 Employers may not establish staffing firms to place Employees with themselves or their subordinate units.

    Section 3 Part-Time Labor

    Article 68 The term “part-time labor” means a form of labor for which the compensation is chiefly calculated by the hour and where the Employee generally averages not more than 4 hours of work per day and not more than an aggregate 24 hours of work per week for the same Employer.

    Article 69 The two parties to part-time labor may conclude an oral agreement.
    A Employee who engages in part-time labor may conclude an employment contract with one or more Employers, but a subsequently concluded employment contract may not prejudice the performance of a previously concluded employment contract.

    Article 70 The two parties to part-time labor may not stipulate a probation period.

    Article 71 Either of the two parties to part-time labor may terminate the use of the labor by notice to the other party at any time. No severance pay shall be payable by the Employer to the Employee upon termination of the use of the labor.

    Article 72 The hourly compensation rate for part-time labor may not be lower than the minimum hourly wage rate prescribed by the People’s Government of the place where the Employer is located.

    The labor compensation settlement and payment cycle for part-time labor may not exceed 15 days.

    Chapter 6 Monitoring Inspections

 

Article 73 The State Council’s labor administration authority shall be responsible for overseeing the implementation of the employment contract system nationwide. The labor administration authorities of local People’s Governments at the county level and above shall be responsible for overseeing the implementation of the employment contract system in their respective jurisdictions.
    In the course of overseeing the implementation of the employment contract system, the labor administration authorities of People’s Governments at the county level and above shall consider the opinions of the Trade unions, the representatives on the side of the enterprises and the authorities in charge of the industries concerned.

    Article 74 The labor administration authorities of local People’s Governments at the county level and above shall conduct monitoring inspections of the implementation of the following aspects of the employment contract system, in accordance with the law:
    (1) Employers’ formulation of rules and regulations that have a direct bearing on the immediate interests of Employees, and the implementation thereof;
    (2) The conclusion and termination of employment contracts by Employers and Employees;
    (3) Compliance with relevant regulations on placement by staffing firms and Accepting Units;
    (4) Employers’ compliance with state regulations on Employees’ working hours, rest and leave;
    (5) Employers’ payment of labor compensation as specified in the employment contracts and compliance with minimum wage rates;
    (6) Employers’ enrollment in the various types of social insurance and payment of social insurance premiums; and
    (7) Other labor matters requiring monitoring inspections, as specified in laws and administrative statutes.

 

Article 75 When the labor administration authority of a local People’s Government at the county level or above conducts a monitoring inspection, it has the authority to review materials relating to the employment contracts and collective contracts and conduct an on the-spot inspection of the work premises. Both the Employer and the Employees shall truthfully provide relevant information and materials.
     When working personnel of a labor administration authority conduct a monitoring inspection, they shall show their IDs, exercise their functions and powers according to law and enforce the law in a well-disciplined manner.
 
     Article 76 Such competent authorities as construction authorities, health authorities, production safety regulators, etc. of People’s Governments at the county level and above shall, to the extent of their respective purviews, oversee the implementation of the employment contract system by Employers.

     Article 77 A Employee whose lawful rights and interests have been infringed upon shall have the right to request that the relevant authority deal with the infringement according to law, or to apply for arbitration and institute an action according to law.

     Article 78 Trade unions shall safeguard the lawful rights and interests of Employees in accordance with the law and monitor the performance of the employment contracts and collective contracts by Employers. If an Employer violates labor laws or statutes or breaches an employment contract or collective contract, the Trade union has the right to voice its opinion or require that the matter be rectified. If a Employee applies for arbitration or institutes an action, the Trade union shall provide support and assistance in accordance with the law.

     Article 79 All organizations and individuals are entitled to report violations of this Law.
     The labor administration authorities of People’s Governments at the county level and above shall timely check and handle the violations reported and reward those persons whose reports are valuable.

     Chapter 7 Legal liability

 

Article 80 If an Employer’s rule or regulation with a direct bearing on the immediate interests of Employees violates laws or administrative statutes, the labor administration authority shall order rectification and give a warning. If the said rule or regulation caused a Employee to suffer harm, the Employer will be liable for damages.

    Article 81 If the text of an employment contract provided by an Employer lacks any of the mandatory clauses which this Law requires to be included in such contracts or if an Employer fails to deliver the text of the employment contract to the Employee, the labor administration authority shall order rectification; if the Employee suffered harm as a result thereof, the Employer will be liable for damages.

    Article 82 If an Employer concludes a written employment contract with a Employee more than one month but less than one year after the date on which it started using him, it shall each month pay to the Employee twice his wage.
    If an Employer fails, in violation of this Law, to conclude an open-ended employment contract with a Employee, it shall each month pay to the Employee twice his wage, starting from the date on which an open-ended employment contract should have been concluded.

    Article 83 If the probation period stipulated by an Employer with a Employee violates this Law, the labor administration authority shall order rectification. If the illegally stipulated probation has been performed, the Employer shall pay compensation to the Employee according to the time worked on probation beyond the statutory probation period, at the rate of the Employee’s monthly wage following the completion of his probation.

    Article 84 If an Employer violates this Law by retaining a Employee’s resident ID card or other papers, the labor administration authority shall order the same returned to the Employee within a specified period of time and impose a penalty in accordance with the provisions of relevant laws.
    If an Employer violates this Law by collection property from Employees as security or under some other guise, the labor administration authority shall order the same returned to the Employees within a specified period of time and impose a fine on the Employer of not less than RMB￥500 and not more than RMB￥2,000 for each person; If the Employees suffered harm as a result of the said conduct on the part of the Employer, the Employer will be liable for damages. If an Employer retains a Employee’s file or other Article after the Employee has terminated or ended his employment contract in accordance with the law, a penalty shall be imposed in accordance with the preceding paragraph.

    Article 85 If an Employer:
    (1) Fails to pay a Employee his labor compensation in full and on time as stipulated in his employment contract or prescribed by the state;
    (2) Pays labor compensation below the local minimum wage rate;
    (3) Arranges overtime without paying overtime pay; or
    (4) Terminates or ends an employment contract without paying the Employee severance pay pursuant to this Law; then the labor administration authority shall order it to pay the labor compensation, overtime pay or severance pay within a specified period of time; if the labor compensation is lower than the local minimum wage rate, the Employer shall pay the shortfall. If payment is not made within the time limit, the Employer shall be ordered to additionally pay damages to the Employee at a rate of not less than 50 percent and not more than 100 percent of the amount payable.

 

Article 86 If an employment contract is confirmed as being invalid in accordance with Article 26 hereof and the other party suffers harm as a result thereof, the party at fault shall be liable for damages.

    Article 87 If an Employer terminates or ends an employment contract in violation of this Law, it shall pay damages to the Employee at twice the rate of the severance pay provided for in Article 47 hereof.

    Article 88 If an Employer:
    (1) uses violence, threats or unlawful restriction of personal freedom to compel a Employee to work;
    (2) Instructs in violation of rules and regulations, or peremptorily orders, a Employee to perform dangerous operations which threaten his personal safety;
    (3) Insults, corporally punishes, beats, illegally searches or detains a Employee; 
    (4) provides odious working conditions or a severely polluted environment, resulting in serious harm to the physical or mental health of Employees; it shall be subjected to administrative punishment; if the said conduct constitutes a criminal offense, criminal liability shall be pursued according to law; if the Employee suffers harm as a result of the said conduct on the part of the Employer, the Employer will be liable for damages.

    Article 89 If an Employer fails, in violation of this Law, to issue to a Employee a certificate evidencing the termination or ending of his employment contract, the labor administration authority shall order rectification. If the Employee suffers harm as a result of such failure, the Employer will be liable for damages.

    Article 90 If a Employee terminates his employment contract in violation of this Law or breaches the confidentiality obligations or competition restrictions stipulated in his employment contract, and if such violation or breach causes his Employer to suffer loss, he will be liable for damages.

    Article 91 If an Employer hires a Employee whose employment contract with another Employer has not yet been terminated or ended, causing the other Employer to suffer a loss, it shall be jointly and severally liable with the Employee for damages.

    Article 92 If a staffing firm violates this Law, the labor administration authority and other relevant competent authorities shall order it to rectify the situation. If the circumstances are serious, it shall impose a fine of not less than RMB￥1,000 and not more than RMB￥5,000 for each person, and the administration for industry and commerce shall revoke the business license. If the Employee(s) placed suffer(s) harm, the staffing firm and the Accepting Unit shall be jointly and severally liable for damages.

     Article 93 An Employer that carries on business without the legal qualifications therefore will be pursued according to law for its legal liability for its illegal and criminal acts. If its Employees have already performed labor, the Employer or its investor(s) shall pay them labor compensation, severance pays and damages in accordance with the relevant provisions of this Law. If the Employees suffer harm as a result thereof, the said unit shall be liable for damages.

     Article 94 If an individual that contracts for the operation of a business hires Employees in violation of this Law and a Employee suffers harm as a result thereof, the organization that employed such contractor shall be jointly and severally liable with the contractor for damages.

     Article 95 If a labor administration authority, another competent authority or a member of its working personnel neglects its/his duties, fails to perform its/his statutory duties or exercises its/his authority in violation of the law, thereby causing harm to a Employee or an Employer, liability for damages shall be borne and the leading official directly in charge and the other persons directly responsible shall be subjected to administrative penalties in accordance with the law; if a criminal offense is constituted, criminal liability shall be pursued in accordance with the law.

     Chapter 8 Supplementary Provisions

 

 Article 96 Where laws or administrative statutes contain, or the State Council has formulated, separate regulations concerning the conclusion, performance, amendment, termination or ending of employment contracts by and between institutions and those of their working personnel that are subject to the employment system, matters shall be handled in accordance with such regulations; in the absence of such regulations, matters shall be handled in accordance with this Law.
    

Article 97 Employment contracts concluded in accordance with the law before the implementation of this Law and continuing to exist on the implementation date of this Law shall continue to be performed. For the purposes of item (3) of the second paragraph of Article 14 hereof, the number of consecutive occasions on which a fixed-term employment contract is concluded shall be counted from the first renewal of such contract to occur after the implementation of this Law.
     If an employment relationship was established prior to the implementation of this Law without the conclusion of a written employment contract, such contract shall be concluded within one month from the implementation date of this Law.
     If an employment contract existing on the implementation date of this Law is terminated or ends after the implementation of this Law and, pursuant to Article 46 hereof, severance pay is payable, the number of years for which severance pay is payable shall be counted from the implementation date of this Law. If, under relevant regulations in effect prior to the implementation of this Law, the Employee is entitled to severance pay from the Employer in respect of a period preceding the implementation of this Law, the matter shall be handled in accordance with the relevant regulations that were in effect at that time.

     Article 98 This Law shall be implemented from January 1, 2008.