Answer: Employees engaged in the same or similar work should receive the same or close remuneration. This is called equal pay for equal work in China’s employment law. The Employment Contract Law has two rules on equal pay for equal work: the first is that an employee¡¯s remuneration should be determined firstly by the provisions in the employment contract, secondly by collective contract in absence of the provisions, and thirdly the principle of equal pay for equal work in absence of the former two. (Articles 11 and 18). The second is that employees on labor dispatch receive equal pay for equal work that normal employees do (Article 63).
Judging from relevant judicial decisions, the cases that found no violation of equal pay for equal work and rejected claims for wage discrepancies account for an absolute majority. Only in a few cases, such as the case of Liu Li before Heilongjiang Provincial High Court in 2018 and the case of Yang Quanyou before Shihezi City Court in Xinjiang in 2016, did the courts find that the employers violated the principle of equal pay for equal work.1Liu Li, Harbin Radio and Television Station Labor Dispute Retrial Review and Trial Supervision Civil Ruling Heilongjiang Provincial People¡¯s High Court Civil Ruling (2018) Hei Min Shen No.3392. This is a rare case, the court remitted the case for retrial on the ground that the comparative position employee¡¯s wages items are different from those of the plaintiff workers and that the principle of equal pay for equal work was violated. Labor Dispute between Yang Quanyou and Shihezi Zhongyuan Labor Dispatch Co., Ltd. Civil Judgment (2016) Bing 9001 Min Chu No.6016 of the People’s Court of Shihezi City, Xinjiang Uygur Autonomous Region. The court held that the employer implemented different annual wages for permanent workers and contract workers, which violated the principle of equal pay for equal work, and the court supported the request for wage difference.
There are many reasons for courts not finding violation of equal pay for equal work in legal practice. The first situation is that some courts found that employees fails to prove the nature of their roles being the same as that of the comparative roles, or that even if a role was similar but the qualifications and experience of the two were different, while the employee has agreed upon the wages in their employment contract, there was no violation of the principle of equal pay for equal work.
In the second situation, some courts held that equal pay for equal work does not mean an exactly same pay, and that a reasonable difference should not be regarded as a violation of equal pay for equal work, if the nature of the role and the seniority of the employee and the comparator employee are taken into account, 2Du Zhiwei and Guangzhou Public Security Bureau Liwan District Branch Organ Service Center Labor Dispute Retrial Case, Guangdong Provincial People¡¯s High Court Civil Ruling (2017) No.852. Harbin Pharmaceutical Group Pharmaceutical General Factory v. Lv Xinyou Labor Dispute Case, Heilongjiang Provincial People¡¯s High Court Civil Ruling (2015) No.208, Heilongjiang Province. Labor Dispute Case of Tao Baoping v. Jiangsu Hongyun Property Management Co., Ltd. Civil Judgment of Gangzha District People’s Court of Nantong City, Jiangsu Province (2017) Su 0611 Min Chu No.1108.or directly ruled that agreements in employment contract prevails the principle of equal pay for equal work under the Article 11 of the Employment Contract Law.
The third situation is the common phenomenon where employees inside and outside establishments, such as state-owned companies or other business organizations, normally receive unequal pay in the reality. Many court cases have explicitly stated that employment contracts within the establishment are incomparable to those outsider.3Civil Ruling on Labor Dispute Retrial Review and Trial Supervision of Xiong Yan and Gongan County Experimental Kindergarten Civil Ruling of the High Court of Hubei Province (2015) E Min Shen Zi No.00971. Civil Ruling on Labor Dispute Retrial Review of Yang Chunhai and Siping Local Taxation Bureau Civil Ruling of the High Court of Jilin Province (2016) Ji Min Shen Zi No.92. Wang Ling v. Xiangxi Tujia and Miao Autonomous Prefecture Central Sub-branch of the People’s Bank of China and other labor disputes, Hunan Provincial People¡¯s High Court Civil Ruling (2016) Xiang Min Shen No.1344. The court held that the dispatched employees could not be compared with the employees regulated by the bank management law within the establishment. Civil Ruling of Qinghai High Court (2022) Qing Min Shen No.541. ¡°But the relationship between the respondent and the applicant is an employment relationship, not a civil servant relationship. The wage distribution system of government institutions is different from that of enterprises.¡± This sad reality in the current employment relationship system probably stems from the convention in the past hierarchical employment management system.
This article is a part of our new book“Employment Law in China: A Practical Guide. A book about “What should I do” with case laws.”Stay tuned, and the book will soon be published as an electronic books!
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
- 1Liu Li, Harbin Radio and Television Station Labor Dispute Retrial Review and Trial Supervision Civil Ruling Heilongjiang Provincial People¡¯s High Court Civil Ruling (2018) Hei Min Shen No.3392. This is a rare case, the court remitted the case for retrial on the ground that the comparative position employee¡¯s wages items are different from those of the plaintiff workers and that the principle of equal pay for equal work was violated. Labor Dispute between Yang Quanyou and Shihezi Zhongyuan Labor Dispatch Co., Ltd. Civil Judgment (2016) Bing 9001 Min Chu No.6016 of the People’s Court of Shihezi City, Xinjiang Uygur Autonomous Region. The court held that the employer implemented different annual wages for permanent workers and contract workers, which violated the principle of equal pay for equal work, and the court supported the request for wage difference.
- 2Du Zhiwei and Guangzhou Public Security Bureau Liwan District Branch Organ Service Center Labor Dispute Retrial Case, Guangdong Provincial People¡¯s High Court Civil Ruling (2017) No.852. Harbin Pharmaceutical Group Pharmaceutical General Factory v. Lv Xinyou Labor Dispute Case, Heilongjiang Provincial People¡¯s High Court Civil Ruling (2015) No.208, Heilongjiang Province. Labor Dispute Case of Tao Baoping v. Jiangsu Hongyun Property Management Co., Ltd. Civil Judgment of Gangzha District People’s Court of Nantong City, Jiangsu Province (2017) Su 0611 Min Chu No.1108.
- 3Civil Ruling on Labor Dispute Retrial Review and Trial Supervision of Xiong Yan and Gongan County Experimental Kindergarten Civil Ruling of the High Court of Hubei Province (2015) E Min Shen Zi No.00971. Civil Ruling on Labor Dispute Retrial Review of Yang Chunhai and Siping Local Taxation Bureau Civil Ruling of the High Court of Jilin Province (2016) Ji Min Shen Zi No.92. Wang Ling v. Xiangxi Tujia and Miao Autonomous Prefecture Central Sub-branch of the People’s Bank of China and other labor disputes, Hunan Provincial People¡¯s High Court Civil Ruling (2016) Xiang Min Shen No.1344. The court held that the dispatched employees could not be compared with the employees regulated by the bank management law within the establishment. Civil Ruling of Qinghai High Court (2022) Qing Min Shen No.541. ¡°But the relationship between the respondent and the applicant is an employment relationship, not a civil servant relationship. The wage distribution system of government institutions is different from that of enterprises.¡±