How to terminate employees in China

Let me help you by listing down some points an employer can use to terminate an employee without requirement for notice in the following situations:

1. During the probation period, if the employee is determined to be unfit for the position;
2. The employee materially breaches the rules and regulations provided by the employer;
3. The employee is in serious dereliction of duty, graft or corruption causing substantial damage to the employer’s interests;
4. The employee has established an employment relationship with another employer and that relationship affects the completion of his tasks and he refuses to appropriately remedy the situation after notification from the employer;

An employer must give 30 days’ prior written notice or payment in lieu thereof, if it terminates the labor contract under the following situations: One is if the employee is unable to perform his original duties or re-assigned duties, after returning from medical leave or non-work-related injury;second condition can be if the employee is incompetent and remains incompetent after training or adjustment of position; or,third could be if there has been a major change in ‘objective’ circumstances which were relied upon in the signing of the labor contract, and the employee and employer are unable to agree upon the modified terms of the labor contract.

You might have to provide severance compensation in a number of situations, which can be

1. The employer terminates the employee under situations requiring 30 days’ prior written notice (as previously mentioned);
2. The employee is terminated due to restructuring or difficulties in business operations;
3. Termination of the labour contract is proposed by employer and there is mutual agreement with regards to the termination thereof;
4. Expiration of a fixed-term labour contract (except where the employee refuses to renew the contract on terms equal to or better than that previously concluded);
5. Termination of the labour contract is due to the revocation of the employer’s business license; or, bankruptcy.