The Ministry of Human Resources and Social Security (MOHRSS) finally issued the draft labour dispatch regulations in August 2013 for public comment. According to Chinese media reports, originally the ministry had planned to pass the regulations by 1 July 2013.
The draft regulations include some significant provisions that would help clarify certain matters left unclear in the amended Labour Contract Law (LCL). For example, some guidance is provided regarding how to distinguish a true outsourcing arrangement from a disguised labour dispatch arrangement.
The draft also provides guidance on how to handle the termination of dispatched workers in the event that the host entity goes through a restructuring. In addition, the draft regulations more clearly provide dispatched workers with a right to sue their host entity for de facto employment if the host entity uses labour dispatch arrangements outside the allowable scope.
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Business Law Digest is compiled with the assistance of Baker & McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker & McKenzie by e-mail at: Zhang Danian (Shanghai) danian.zhang@bakermckenzie.com
