CHINA Law and Practice Contributed by: Linda Liang, Piao Liu, Chutian Wang and Xiangbo Lv, King & Wood Mallesons
• where the employee is proved incompetent in their job and remains incompetent after receiving train - ing or a position amendment by the employer; or • where the objective circumstances on which the conclusion of the employment contract was based have undergone major changes and, as a result, the employment contract can no longer be performed, and upon negotiation between the employer and the employee, both parties are unable to reach an agreement on the change of the employment contract. Unilateral termination by an employee (resignation) An employee has the right to unilaterally terminate the employment contract by giving his/her employer three days՚ prior written notice during the probation period. After completion of the probation period, an employee may terminate his/her employment contract upon pro - viding 30 days’ prior written notice to the employer. Fault Termination Unilateral termination by the employer An employer is entitled to unilaterally terminate the employment contract of an employee without prior notice or any severance pay under any of the follow - ing circumstances: • where the employee is proven to have failed to satisfy the recruitment requirements during the pro - bation period; • where the employee has seriously violated the internal policies of the employer; • where the employee has committed serious dereliction of duty or engaged in malpractice for personal gain, causing material damage to the employer; • where the employee has established an employ - ment relationship with another employer concur - rently, which materially affects the completion of his/her tasks with the current employer, or the employee refuses to rectify the matter as demand - ed by the employer; • where the employee is prosecuted for criminal liability according to the law; or • where an employment contract is rendered wholly or partially void when the employee causes the employer to conclude or amend the employment contract against the employer’s true intention by
means of fraud, coercion or taking advantage of the employer’s disadvantaged position. Unilateral termination by the employee If any of the following circumstances occurs, an employee may terminate the employment contract immediately and is entitled to statutory severance paid by the employer: • where an employer fails to provide labour protec - tion or working conditions pursuant to the provi - sions in the employment contract; • where an employer fails to pay the remuneration in full and/or on a timely basis; • where an employer fails to make social insurance contributions for the employee in accordance with the PRC laws; • where an employer’s internal rules and policies vio - late the law and cause damages to the employee’s rights and interests; • where an employment contract is rendered wholly or partially void when the employer causes the employee to conclude or amend the employment contract against the employee’s true intention by means of fraud, coercion or taking advantage of the employee’s disadvantaged position; or • where an employer uses means such as violence, threats or unlawful restriction of personal free - dom to coerce an employee to work, or where an employer gives orders that violate safety rules or force an employee to engage in dangerous opera - tions that endanger the employee’s safety. End of Employment An employment contract will be ended when any of the following occurs: • the term of the employment contract expires; • the employer is declared bankrupt; • the employer has its business licence revoked, is ordered to close down or decides on early dissolu - tion; • the employee starts to take his/her pension entitle - ment or reaches legal retirement age; • the employee is dead or declared dead or missing by the People’s Court of the PRC; or • any other situation stipulated by applicable PRC laws.
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