Ivan Hu, working at one of Wal-Mart's global purchasing centers in
Shanghai, recently received a surprising notice terminating his labor
relationship with Wal-Mart as of November 30.
Hu is not the only unfortunate one. Wal-Mart's recent purchasing
center layoffs are leading some to question whether the company is
avoiding obligations it faces under an upcoming Chinese labor law.
According to the Law of Labor Contract of China, employers may
revoke a labor contract only if the employee loses work ability due to
illness or injury, or becomes unqualified for the work even after
training or post adjustment, or if the objective conditions taken as
the basis for the contract have greatly changed. In addition, the
laborer must be given written notification 30 days in advance.
Thousands of Huawei staff "quit"
More than 7,000 loyal employees of Huawei,
China's largest private telecom gear maker based in the southern city
of Shenzhen, have quit in exchange for the chance to work for the
company again.
The mass resignation triggered by the company management started
last month. Many legal experts believe it was an irresponsible decision
to exploit a legal loophole before the Labor Contract Law takes effect
on January 1 next year. Under the new law, employees can sign
open-ended labor contracts if they have worked for the same company for
10 or more years in a row.
To encourage them to accept the new arrangement, Huawei worked out
a compensation scheme based on length of service, salaries and bonuses.
The total cost of the package is expected to reach 1 billion yuan
(US$134 million).
