Answer: If you have been assigned to work for your current company by a human resources company, there are four possibilities for your relationship with the human resources company and your current company.
The first possibility is that you are an independent contractor and have no employment relationship with the human resources company and the current company you work for. This usually happens if the work you do for the company is only part of your own business, the company’s control and management over you is more flexible, and your social insurance and personal income tax are handled by yourself. The human resources company only charges a service fee for having introduced you the work opportunity .
Therefore, you have an equal civil relationship with the company where you are working. You are not an employee of the company. You cannot ask the company for the right to pay no less than the minimum wage, annual leave, sick leave, parental home, etc. The remuneration for your services can only be determined according to the contract between the two parties. Disputes between you can only be submitted to commercial arbitration institutions or courts.
The second possibility is that you are an employee of the company you work for. This situation usually occurs when you sign an employment contract with the company, and the human resources company only provides recruitment services for you or the company. In this case, the company you work for is responsible for your daily management, wage payment and so on, and the human resources company will no longer participate in the management after the recruitment. Any dispute you have with the company has nothing to do with the human resources company.
The third kind of possibility is that you belong to a part of this human resources company manpower pool. You sign employment contract with this human resources company, are sent to this company (again be called host employer) for a temporary, substitutive, and auxiliary job. This situation is called labor dispatch. Your social insurance contribution and individual income tax are deducted in this human resources company, your dispatch. You usually can put forward to the human resources company for your employment law right only, for example to request the human resources company to solve your late wage or wage below minimum standard. However, if the host employer (that is, the company you work for) is at fault in the damages to your rights and interests under employment law, it should bear joint and several liability with the human resources company.1The joint and several liability of the employer stipulated in Article 92 of the Employment Contract Law should be interpreted in combination with the obligations of the host employer, that is, the host employer shall not be liable unless it is at fault. Shandong High Court (2022) Lu Min Shen No.9836, Li Xinqi, Shandong Radio and Television Bureau Service Center and other civil applications for retrial of Employment Disputes. ¡°There is no legal basis for Li Xinqi’s request that the service center of Shandong Radio and Television Bureau, as the host employer, together with the dispatch employer, jointly and severally assume the obligation to pay economic compensation. This is beyond the scope of the legal obligation of the employer stipulated in Article 62 of the Employment Contract Law, and it is not improper for the first instance decision not to support it.¡±In addition, if the host employer causes losses to you, the labor dispatch employer shall also bear joint and several liability for the damages.2Article 92 of the Employment Contract Law of the People’s Republic of China stipulates that if the host employer causes damage to the dispatched workers, the labor dispatch employer shall bear joint and several liability for compensation with the host employer.
The fourth possibility is that you have signed a labor dispatch contract with the human resources company, which stipulates that your employer is the labor dispatch company, but because the labor dispatch is invalid, your host employer is recognized as your direct employer. You can claim your employment law rights directly to the employer, such as wages, overtime wages, rest and vacation rights, instead of claiming rights only to the labor dispatch company according to the labor dispatch contract. The advantage of this is that the host company, which actually runs the business, may be more capable of compensating you and enforcing a related judgment than the human resources company. Moreover, because the labor dispatch company is at fault in invalidity of the labor dispatch, it should bear joint and several liability for your claim together with the host employer.3Civil Ruling on Employment Dispute Retrial Review and Trial Supervision of Shenhuabei Power Shengli Energy Co., Ltd. and Xilingol League Yingxin Mechanical and Electrical Equipment Co., Ltd. and Xilinhot Chenda Human Resources Service Co., Ltd. Civil Ruling of Inner Mongolia Autonomous Region High Court (2019) No.4675. ¡°The labor dispatch agreement involved in the case dispatched the workers many times without changing their roles. This violated the law. The Laolian Company did not have the qualification of labor dispatch, and the signing of the labor dispatch agreement with Yingxin Mechatronics obviously violated the provisions of the Employment contract Law. The labor dispatch agreement signed by Chenda Company, Laolian Company, and Yingxin Company is to avoid the responsibility of employment. It is not improper for the first-instance decision to determine that the contract is invalid. The termination of the employment contract between Shenhua Company and 86 employees did not comply with the law, and it was not improper for the original judgment to impose the legal liability for the illegal termination of the employment contract, and for Yingxin Mechanical and Electrical Company, Chenda Company and Laolian Company to assume joint and several liability.¡±
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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.
Email: wangdong@royalaw.com
- 1The joint and several liability of the employer stipulated in Article 92 of the Employment Contract Law should be interpreted in combination with the obligations of the host employer, that is, the host employer shall not be liable unless it is at fault. Shandong High Court (2022) Lu Min Shen No.9836, Li Xinqi, Shandong Radio and Television Bureau Service Center and other civil applications for retrial of Employment Disputes. ¡°There is no legal basis for Li Xinqi’s request that the service center of Shandong Radio and Television Bureau, as the host employer, together with the dispatch employer, jointly and severally assume the obligation to pay economic compensation. This is beyond the scope of the legal obligation of the employer stipulated in Article 62 of the Employment Contract Law, and it is not improper for the first instance decision not to support it.¡±
- 2Article 92 of the Employment Contract Law of the People’s Republic of China stipulates that if the host employer causes damage to the dispatched workers, the labor dispatch employer shall bear joint and several liability for compensation with the host employer.
- 3Civil Ruling on Employment Dispute Retrial Review and Trial Supervision of Shenhuabei Power Shengli Energy Co., Ltd. and Xilingol League Yingxin Mechanical and Electrical Equipment Co., Ltd. and Xilinhot Chenda Human Resources Service Co., Ltd. Civil Ruling of Inner Mongolia Autonomous Region High Court (2019) No.4675. ¡°The labor dispatch agreement involved in the case dispatched the workers many times without changing their roles. This violated the law. The Laolian Company did not have the qualification of labor dispatch, and the signing of the labor dispatch agreement with Yingxin Mechatronics obviously violated the provisions of the Employment contract Law. The labor dispatch agreement signed by Chenda Company, Laolian Company, and Yingxin Company is to avoid the responsibility of employment. It is not improper for the first-instance decision to determine that the contract is invalid. The termination of the employment contract between Shenhua Company and 86 employees did not comply with the law, and it was not improper for the original judgment to impose the legal liability for the illegal termination of the employment contract, and for Yingxin Mechanical and Electrical Company, Chenda Company and Laolian Company to assume joint and several liability.¡±