Why Does The Labor Contract Law Trigger Dismissal?

Two months before the formal implementation of the labor contract law in China, there was a wave of corporate Rescission in some parts of the country. Some enterprises have lifted hundreds of people's labor contracts at once, and even some enterprises have been closed due to the imminent entry into force of the labor contract law. As a well-known enterprise in China's IT industry, Shenzhen HUAWEI company has joined in this special game game. According to the company's requirements, employees who have worked for eight years will have to complete the resignation formalities before the new year's day in 2008, and then sign a labor contract with the company for one to three years. It is estimated that the number of cancelling the contract is between thousands and ten thousand.

The regulations of HUAWEI Shenzhen to issue automatic resignation procedures are clearly aimed at meeting the challenges posed by the labor contract law. But its peculiarity is that it will solve the waste of human resources through the resignation and competition of the whole staff, alleviate the inertia of human resources management and further enhance the competitiveness of enterprises.

HUAWEI Shenzhen has reason to do so.

First of all, the conditions for dissolution of labor contracts issued by Shenzhen HUAWEI are far higher than those stipulated in the labor contract law. Shenzhen HUAWEI not only pays the compensation fee according to the continuous working years of employees, but also pays an extra month's wages. It not only pays the average wage for the first twelve months before the termination of the labor contract, but also pays the average amount of bonus for the employees in the previous year. More importantly, after the termination of the labor contract, all the departing employees are able to find jobs again through competition. During this period, their restricted shares in the company remain. In other words, although the contract was terminate with the employee, it still maintained a shareholding relationship with the employees. Such a pattern of interest distribution is certainly attractive.

Secondly, Shenzhen HUAWEI implemented a collective initiative resignation system. All the eligible employees including HUAWEI chairman submitted an application for automatic resignation to the company, which made the reform of the human resources system have a strong moral sense: in the face of very good conditions for cancelling the contract, the workers are not facing much choice. If you take this opportunity to choose your career again, you will have enormous opportunity cost; conversely, if you choose to compete again, you will not only show confidence in the company, but also show loyalty to the company. It is precisely this scientific system design that allows HUAWEI's human resources managers to adjust their human resources structure calmly and rebuild the human resources operation and reserve mode of enterprises.

The practice of HUAWEI in Shenzhen is obviously special. If the employer fails to pay the economic compensation according to the labor contract law, or can not provide re employment for the workers, then the direct disengagement of the labor contract is the most rational choice.

At the time when the legislature formulated the labor contract law, it intended to "protect the legitimate rights and interests of laborers". However, before the promulgation and implementation of the labor contract law, such a problem occurred. If the legislature can take full account of these possible factors in the consideration of the draft labor contract law and make necessary provisions on the problems existing in the transitional period, the trend of dissolution of labor contracts will not arise. This shows that when the legislature formulating legal norms, the value orientation of the law is fixed, but the design of specific legal norms is still somewhat rough.

Through this phenomenon, people can find many problems. For example, in the game of rights and obligations between laborers and employers, is it necessary to add elastic clauses? Under the premise of negotiating an equal legal platform for workers and employers, whether we should take into account China's national conditions, adopt a step-by-step strategy to protect the legitimate interests of those long-term "temporary workers"; emphasize the necessity of revising the social security system while emphasizing the difference between fixed term labor contracts and non fixed term labor contracts, so as to achieve the balance between workers' rights and obligations under different employment mechanisms.

Obviously, between the fixed term labor contract and the non fixed term labor contract, the parties to the labor contract strive for not only the interests between the two parties, but also the social security that the government should provide in accordance with the law. Under such circumstances, it is obviously very difficult to balance the rights and obligations by negotiating with each other on the basis of the labor contract. It is obvious that Shenzhen HUAWEI uses the right to terminate the contract to circumvent the relevant laws and regulations. Although Shenzhen HUAWEI company has reestablished labor relations with its employees through the adjustment of human resources, Shenzhen HUAWEI has paid an economic price for itself. Why does the legislature not change the asymmetric game state by adjusting the social security system?