Answer: An employer terminating an employee on the ground of serious violation of company rules is the severest disciplinary punishment. The employer’s dismissal must meet three conditions to qualify as legal dismissal: the first is the existence of effective company rules or contractual agreement or professional ethics (“Rules”); the second is the establishment of the fact that the employee has seriously violated the Rules; and the third is that the dismissal procedure meets the legal requirements.
First, effective rules serve as the basis for lawful disciplinary action and termination, forming the prerequisite for legal dismissal. From a legal and practical perspective, effective rules encompass valid company rules, effective terms in employment contract, and professional ethics. Please refer to “What kind of company rules are binding on employees?”
Employers must also satisfy the second and third conditions for lawful dismissals. An employer should be responsible for proving that the employee has actually seriously violated the Rules; this is the factual basis for termination of the employment. In addition, the employer also must follow fair, reasonable procedures in dismissing the employee, including notifying in advance of the decision, fairly investigating the incident, and genuinely considering of feedback or explanation from the employee. Please refer to “Is it legally permissible for my employer to discipline me?” And, and employer who dismisses an employee for serious violation of company rules or conducts other types of unilateral terminations must follow the statutory procedure of notifying the trade union. If the employer has not established a trade union, fulfilling this this procedural requirement depends on local regulations and court decisions. Please refer to ” How should my company handle the procedure of notifying trade union when terminating an employee?”
A lawful dismissal of employees on the ground of serious violation of company rules or unilateral dismissal does not attract liability of any compensation; otherwise, they must pay punitive damages or reinstate the employee upon the employees’labor dispute claim.1Article 48 of the Employment Contract Law of the People’s Republic of China stipulates that if an employer dissolves or terminates an employment contract in violation of the provisions of this Law, and the worker requests to continue to perform the employment contract, the employer shall continue to perform the employment contract; if the worker does not request to continue performing the employment contract or if the employment contract can no longer be performed, the employer shall pay punitive damages in accordance with Article 87 of this Law.Please refer to how to calculate punitive damages?
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Mr. Dong Wang has been in practice for over 20 years, specializing in business law, including employment law, commercial law, company law, and intellectual property law. Mr. Wang has earned respect and trust from his clients due to his professionalism, fidielty, and kindness.
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- 1Article 48 of the Employment Contract Law of the People’s Republic of China stipulates that if an employer dissolves or terminates an employment contract in violation of the provisions of this Law, and the worker requests to continue to perform the employment contract, the employer shall continue to perform the employment contract; if the worker does not request to continue performing the employment contract or if the employment contract can no longer be performed, the employer shall pay punitive damages in accordance with Article 87 of this Law.