Labor Contract Law: Resolute Ahead In Difficult Times

On the morning of 8 am, while many CPPCC members discussed the new labor contract law, Sun Baoshu, Vice Minister of labor and social security, said that the increase of labor cost in the labor contract law is to protect the interests of workers.

Does the new law increase business costs?

The labor contract law, which was formally implemented in January 1, 2008, has enabled many enterprises in Quanzhou to re-examine and improve their employment system.

A Quanzhou branch of a freight forwarding company opened up nearly 100 employees before January 1st, accounting for 10%% of the total number of branches.

A staff member of the company's human resources department said that the remaining 90%% employees signed a new labor contract.

The staff acknowledges that the provisions of the labor contract law, which are about to be implemented, will give the company such a large dismissal.

Re signing labor contracts with employees has become the consistent action of labor intensive enterprises in our city since this year.

Mr. Hong, assistant general manager of a company, said that after sending the staff to study the new Law conscientiously, the company and two thousand or three thousand employees re signed the labor contract, but the company felt "the pressure of operating costs increased sharply".

According to the introduction, the pressure comes from the requirements of the new law to ensure employees' rest and double pay for holidays.

The "labor contract law" once again became a hot topic during the "two sessions".

Li Wenjun, Liu Shikun and Shi Xiangpeng, member of the CPPCC National Committee from Hongkong, believe that the implementation of the new law is the protection of the basic interests of labourers. However, these things coincide with the substantial increase in prices of raw materials and appreciation of the renminbi, which have jointly raised the pressure of business.

How to implement this law is a difficult problem.

Sun Baoshu, Vice Minister of the Ministry of labor and social security, said at a press conference of the eleven National People's Congress in March 8th that the reason why enterprises thought that the employment contract law increased labor costs was actually because these enterprises did not legally fulfill their statutory obligations for workers to pay social insurance premiums.

"We believe that it would be wrong and illegal to pursue such high profits if we failed to fulfill the obligations of social insurance premiums and the legitimate rights and interests of workers.

From the perspective of fair competition, if a part of enterprises do not pay social insurance premiums for employees, and so as to reduce costs and participate in market competition, it is unfair for those law-abiding enterprises and regulated enterprises.

Sun Baoshu said.

The implementation of the new law promotes employment harmony. As a disadvantaged group, the rights and interests of workers have long been neglected.

As part of the harmonious employment relationship, we should really attach importance to the rights and interests of workers.

Zhang Xiangqian, deputy director and professor of Human Resources Department of Huaqiao University, said.

Like the rest of the city, the labor contract signing rate before the new law is not very satisfactory.

According to statistics from the labor department, a total of 5016 employers were inspected in 2007, and 95 thousand labor contracts were urged to be signed.

Among the employing units that have not signed labor contracts, small businesses and small shops are the main ones.

"Enterprises take evasive measures to reduce labor costs, and workers are worried about restraint and unwilling to sign. In fact, these are short-sighted actions that only focus on immediate interests."

Professor Zhang Xiangqian believes that as a law to protect the rights and interests of workers, it must be carried out to the letter.

"Migrant workers leave their homes and come to work in cities. They are residents of this city.

At present, the new labor contract law forces enterprises to deal with social security for the migrant workers, such as old-age, unemployment, medical care and so on. In fact, the state, enterprises and individuals shoulder the responsibility of protecting migrant workers.

Zhang Xiangqian said.

Take old-age insurance as an example, when migrant workers get their pensions, they will receive a monthly allowance of a certain percentage of the monthly average wage of the state each month, in addition to receiving the principal and interest paid by themselves and enterprises monthly.

He suggested that enterprises and employees should consciously sign the labor contract to build a harmonious employment relationship so as to promote social harmony.