Answer: Casual employment relations is a flexible way of employment. The Employment Contract Law stipulates that an employer may conclude an oral agreement with a casual employee, and both parties may notify the other party to terminate the employment relationship at any time.1Articles 69 and 71 of the Employment Contract LawThis provision is totally different from the permanent employment contract which emphasizes the protection of the continuation of the employee’s employment contract or the fixed-term employment contract which secure employment within a certain period.
Therefore, we believe that although the law and practice are not very clear, employers should not be obligated to sign permanent employment contracts with their casual employees.
At present, prevailing judicial cases advocate that employers have no legal obligation to sign permanent employment contracts with casual employees. For example, in the case of Shen Sijin in 2017, the Qingyuan Intermediate Court of Guangdong Province pointed out that casual employment is a flexible way of employment, and the employer has no obligation to sign a permanent employment contract. Similar cases include the case of Xiao Xiang before Anshun Intermediate Court of Guizhou Province in 2016 and the case of Li Meiai before Shanwei Intermediate Court of Guangdong Province in 2019.2Employment Dispute Appeal between Shen Sijingui and State-owned Longping Forest Farm Civil Judgment of Qingyuan Intermediate People’s Court of Guangdong Province (2017) Yue 18 Min Zhong No.2319. ¡°Casual employment is a relatively flexible form of employment. Although it is included in the scope of the Employment Contract Law of the People’s Republic of China, it gives either party the right to notify the other party to terminate employment at any time, and the employer does not need to pay economic compensation to the workers. The permanent employment contract refers to the employment contract in which the employer and the worker agree that there is no definite termination time. There are strict legal provisions for employers and workers to request the termination of permanent employment contracts, which is different from casual employment. Therefore, there is no legal grounds in support of the Appellant¡¯ claims that the Appellee has concluded a permanent employment contract with him and must pay punitive damages for illegal termination of the contract.¡± Appellant Xiao Xiang and Appellee Pingba Power Supply Bureau Employment Dispute Case Civil Judgment of Anshun Intermediate People’s Court of Guizhou Province (2016) Qian 04 Min Zhong No.240. ¡°The employment nature of both parties is casual, which does not fall under the situation that permanent contract should be signed.¡± Li Meiai, Guangdong Power Grid Co., Ltd. Shanwei Lufeng Power Supply Bureau Employment Dispute Second Instance Civil Judgment Guangdong Shanwei Intermediate People’s Court Civil Judgment (2019) Yue 15 Min Zhong No.156. ¡°According to Article 71 of the Employment Contract Law of the People’s Republic of China, “Either party to casual employment may notify the other party to terminate employment at any time.” Therefore, casual employment does not belong to the situation that permanent employment contracts should be signed.¡±However, in the case of Panshuixian in 2023, the Second Intermediate Court of Beijing held that the law did not prohibit employers from signing permanent employment contracts with casual employees.3Yongzhou Municipal People’s Government Liaison Office in Beijing and Pan Shuixian Employment Dispute Civil Judgment of the Second Intermediate People’s Court of Beijing (2023) Jing 02 Min Zhong No.2097. ¡°Employment Contract Law of the People’s Republic of China Casual employment is not prohibited from concluding a permanent employment contract with the employer. Since Pan Shuixian has worked in the Liaison Office in Beijing for more than ten years, he shall be entitled to establish a permanent employment contract with Pan Shuixian.¡±
Interestingly, there are court decisions that hold that employers and casual workers can sign work assignment contracts. For example, the Intermediate People’s Court of the 12th Division of Xinjiang Production and Construction Corps held this view in the case of Chen Hua in 2022. 4Chen Hua, Xinjiang Tejin Tourism Investment Management Co., Ltd. Employment Dispute Civil Judgment of Second Instance Civil Judgment of Intermediate People’s Court of the 12th Division of Xinjiang Production and Construction Corps (2022) Bing 11 Min Zhong No.213. The court held that according to the stipulation that “the employer and the worker may conclude a employment contract with a period of time to complete a certain task through consultation”, the agreement of the employment contract does not violate the provisions of the law and does not contradict the form of casual employment stipulated in the Labor Law.However, we believe that the signing of a work assignment contract means that the employer cannot dismiss the employee before the completion of the work assignment, which conflicts with the rule that both parties to a casual employment relationship can terminate it at any time, so it is not appropriate for the employer to sign a work assignment contract with casual workers. According to the same reason, it is not appropriate for employers to sign fixed-term and labor dispatch contracts with casual workers. Article 30 of the Regulations on the Implementation of the Employment Contract Law stipulates that the form of casual employment is not applicable to labor dispatch contracts.
In addition, in the practice of employment law, there are also casual irregular work hours or general work hours.5Li Ting, Luoyang Jiaxuan Real Estate Co., Ltd. Civil Judgment of Second Instance of Employment Dispute Civil Judgment of Intermediate People’s Court of Luoyang City, Henan Province (2021) Yu 03 Min Zhong No.210.We believe that both the irregular workhour system and the general workhour system have the employer’s obligation to arrange relatively stable and expectable work for employees, which is essentially different from the casual hours system in which both parties can terminate the relationship at any time. These are the issues that Employment law in China needs to clarify and amend at the legislative level.
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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
- 1Articles 69 and 71 of the Employment Contract Law
- 2Employment Dispute Appeal between Shen Sijingui and State-owned Longping Forest Farm Civil Judgment of Qingyuan Intermediate People’s Court of Guangdong Province (2017) Yue 18 Min Zhong No.2319. ¡°Casual employment is a relatively flexible form of employment. Although it is included in the scope of the Employment Contract Law of the People’s Republic of China, it gives either party the right to notify the other party to terminate employment at any time, and the employer does not need to pay economic compensation to the workers. The permanent employment contract refers to the employment contract in which the employer and the worker agree that there is no definite termination time. There are strict legal provisions for employers and workers to request the termination of permanent employment contracts, which is different from casual employment. Therefore, there is no legal grounds in support of the Appellant¡¯ claims that the Appellee has concluded a permanent employment contract with him and must pay punitive damages for illegal termination of the contract.¡± Appellant Xiao Xiang and Appellee Pingba Power Supply Bureau Employment Dispute Case Civil Judgment of Anshun Intermediate People’s Court of Guizhou Province (2016) Qian 04 Min Zhong No.240. ¡°The employment nature of both parties is casual, which does not fall under the situation that permanent contract should be signed.¡± Li Meiai, Guangdong Power Grid Co., Ltd. Shanwei Lufeng Power Supply Bureau Employment Dispute Second Instance Civil Judgment Guangdong Shanwei Intermediate People’s Court Civil Judgment (2019) Yue 15 Min Zhong No.156. ¡°According to Article 71 of the Employment Contract Law of the People’s Republic of China, “Either party to casual employment may notify the other party to terminate employment at any time.” Therefore, casual employment does not belong to the situation that permanent employment contracts should be signed.¡±
- 3Yongzhou Municipal People’s Government Liaison Office in Beijing and Pan Shuixian Employment Dispute Civil Judgment of the Second Intermediate People’s Court of Beijing (2023) Jing 02 Min Zhong No.2097. ¡°Employment Contract Law of the People’s Republic of China Casual employment is not prohibited from concluding a permanent employment contract with the employer. Since Pan Shuixian has worked in the Liaison Office in Beijing for more than ten years, he shall be entitled to establish a permanent employment contract with Pan Shuixian.¡±
- 4Chen Hua, Xinjiang Tejin Tourism Investment Management Co., Ltd. Employment Dispute Civil Judgment of Second Instance Civil Judgment of Intermediate People’s Court of the 12th Division of Xinjiang Production and Construction Corps (2022) Bing 11 Min Zhong No.213. The court held that according to the stipulation that “the employer and the worker may conclude a employment contract with a period of time to complete a certain task through consultation”, the agreement of the employment contract does not violate the provisions of the law and does not contradict the form of casual employment stipulated in the Labor Law.
- 5Li Ting, Luoyang Jiaxuan Real Estate Co., Ltd. Civil Judgment of Second Instance of Employment Dispute Civil Judgment of Intermediate People’s Court of Luoyang City, Henan Province (2021) Yu 03 Min Zhong No.210.