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Law

Guangdong Provincial Regulation on Collective Negotiation and Collective Contract Draft
Released by Guangdong Provincial People’s Congress, 11 Oct 2013

(Summary of major provisions by IHLO, 16 Oct 2013)

Definition and scope of application
Collective negotiation refers to the negotiation of workers with the employers on remunerations, working hours, rest and holidays, OSH, vocational training, social insurances and welfare on equal basis.
Collective contracts include the enterprise, sectoral and regional collective contracts.
The regulation is applicable to all enterprises within the province.
The collective contract is binding to the enterprise and applicable to the whole workforce (Article 4). It is not clear if irregular workers are included.

Competent authorities
The government promotes collective negotiation; the labour authority oversees collective negotiation and reviews the collective contracts for compliance with the law. The regional trade union federations organise, instruct and monitor enterprise trade unions to initiate, sign and enforce the collective contracts. The enterprises’ and employers’ associations and the supervisory authorities of the public and state-owned enterprises give assistance to the enterprises and construct the collective negotiation mechanism.

Content of collective negotiation
The scope of content of collective negotiation has widened to include protection of the agency workers, vocational training and dismissals. However, job security and retrenchment which is increasingly contentious is not covered.
Negotiation may focus on a single or combination of the following issues:
Remunerations; 2) Working hours; 3) Rest and holidays; 4) OSH; 5) insurances and welfare; 6) protection of female and teenage workers; 7) protection of the agency workers; 8) vocational training; 9) administration of the collective contract; 10) Penalties; 11) Dismissals; 12) Term of the collective contract; 13) revision and cancellation of the collective contract; 14) resolution of disputes regarding the collective contract; 15) legal responsibilities for violations of the collective contract; 16) Others.

Terms of the collective contract
A collective contract is signed for a duration of one to three years, to be re-negotiated three months prior to its expiry.

Wage Negotiation

  1. Wage is an exclusive subject for collective negotiation and contract. The scope of wage negotiation is widened to cover the wage distribution mechanism, disbursement, wage levels, adjustment rate and mechanism, allowances and bonuses, probation and leave wages; as well as the revision, termination, legal responsibilities related to the collective contract on wage. Wage negotiation takes place annually.
  2. A number of factors should be considered in setting the wage levels namely CPI, labour productivity and economic performance of the enterprise, the wage guidelines released by the labour bureau and the statutory minimum wage levels.
  3. Either side may request a wage negotiation if there are changes in labour productivity and the economic performance of the company, the CPI index, or in the government released wage guidelines (Article 10).

Sectoral negotiation

  1. Sectoral and regional negotiations take place between the sectoral and regional federation of trade unions and the corresponding enterprises and employers’ associations, applicable to enterprises and employees in the sector or the region.
  2. Agency workers’ protection is included in the sectoral negotiation. The scope of content of sectoral negotiation: a) floor wage of the sector; b) wage adjustment rate; c) unit price of the same work; d) OSH standards; e) vocational training; f) special protection for the women, teenage and agency workers (Article 13).

Representatives for negotiation
The ACFTU is the only bargaining agent with the employers and it is ensured to have control and influence over the workers’ representatives. The regional trade union federations play the safeguard role in the election and appointment of workers’ representatives if there is no trade union in the company or the trade union is dysfunctional. Yet the law does not specify the nomination and the election procedure of the workers’ representatives.

  1. The chairperson of the trade union (or the person endorsed by the chairperson) is the first delegate on behalf of the employees. The other representatives should be delegated by the trade union or elected in the workers’ assembly (Article 16).

 

  1. For enterprises without a trade union, the regional federation of trade unions should step in and assist the election of the workers’ representatives or delegate representatives in emergency situations where elections cannot be held (Article 16).
  1. There should be female representatives based on proportion.
  2. The workers’ representatives in the sectoral and regional negotiations are representatives from the sectoral and the regional federations (Article 17).
  3. Third-party professionals can be appointed in the delegation of both sides and the size should be less than one-third of that of the delegation (Article 18).
  4. Recall the union chair as the first delegate in the negotiation - The regional trade union federation should demand corrections from the company trade union if it fails to perform its duties. If the chairperson fails to perform the duties as the first delegate, employees can recall and replace the first delegate if one-third of the workforce demands it, or if the decision is made in the workers’ assembly. The regional federation should call the workers’ assembly to elect a replacement (Article 19).
  5. Protection of the negotiation representatives – that includes prohibition against dismissal, suspension, demotion or re-allocation of the job of the representatives, reduction of wages and benefits (Article 20); time off to attend meetings related to the negotiation (Article 23).
  6. Role of the negotiation representatives – that include attend the negotiation meetings; collect information related to the negotiations; collect opinions within its mandate; take part in the dispute handling regarding the collective contract (Article 22).

 

Information disclosure
Information requested by the other side should be provided including unit prices, wage and social insurance disbursement, tax payments etc.

Negotiation process
The trade union should request the employer for a negotiation if more than one-third of the employees demand it.

  1. The trade union represents workers to make the request for negotiation. If more than one-third of the the workers’ (representatives’) assembly make the request to the company union, or to the upper federation in case there is no trade union in the company, the union should, after considering the request and the company’s situation, ask the employer for a negotiation (Article 26).
  2. Either side should give a reply to the request for negotiation within twenty days after receiving the written request. The negotiation meeting should he held within sixty days, to be extended by another fifteen days by maximum, after the request has been made (Article 25).

The municipal or provincial federation of trade unions may demand rectification from the company if it fails to react to the negotiation request (Article 57). If the rejection of the employer to negotiate leads to a stoppage of work or go-slow, the employer is not allowed to dismiss the employees who take part in these actions. The employer is obliged to compensate the employees if they demand a termination of the employment contract under such circumstances (Article 57).

  1. The negotiation meeting will be chaired by the first delegate of both side or by a third party mutually agreed; the minutes of the meeting should be signed by all the attending representatives.

 

Prohibitions during the negotiation
Lockouts and unfaithful bargaining of the employers are prohibited but not the anti-strike measures or other unfair practices against the strikers and workers. The protection applies only to the workers’ representatives for negotiation.

The employers are not allowed to : a) reject or postpone the negotiation without a good reason; b) restrict, disturb the appointment of the worker representatives or refuse to negotiate with them; c) lockout the workplace; d) bar the trade union from exercising its duties; e) refuse to provide the necessary information or provide false information; f) change or terminate the employment contract of the worker representatives; g) refuse to enforce the mediation resolution; h) make provocative acts; i) threaten, bribe, restrict the personal freedom, insult or use violence against the worker representatives (Article 30).
The local government should demand the employers for rectifications (Article 58).

Strike and stoppage of work and go slow are banned during collective negotiation.
The employees are not allowed to : a) use stoppage of work or go-slow to refuse a negotiation with the employer, demand changes or revoke the current collective contract; b) disseminate false facts and information; incite, organize, provoke, liaise, threaten or coerce other employees to take part in the work stoppage or go-slow; c) damage the company’s facilities and obstruct the company’s operation; d) obstruct or block the exits of the premises of the company, stop the transportation of goods and materials; e) threaten or bribe the company’s negotiation representatives; f) restrict the personal freedom, insult, threaten or attack the company’s representatives; g) organize or take part in work stoppage when the employer has agreed to enforce the conciliation or mediation agreement; h) take other provocative actions (Article 31).

The provision allows for interpretations in favour of the employers to take retaliation if workers take part in strike during the negotiation.
The employers are allowed to terminate the employment contract based on the Labour Contract Law if an employee has committed the above acts, violated the company rules, made a serious mistake in work or engage in misappropriations incurring the economic loss of the company (Article 31).
Employees taking part in work stoppage or go-slow during the negotiation period will not receive salary (Article 32).

Vague mechanism to deal with wild cat strikes outside the collective negotiation mechanism
If a stoppage of work or go-slow takes place, the trade union should represent the employees to seek a negotiation with the employer or the relevant body. The trade union should reflect the opinions of the workers, propose solutions. The employer should address the reasonable demands of the employees. The trade union should assist in the negotiation and resume the operation of the company (Article 34).

Administrative and criminal penalties against the strikers
Employers and employees who have violated the provisions in Article 30 and 31, breached the provisions in the public security administration law, are liable to administrative or criminal penalties exercised by the public security. Employees who incite, organize, provoke and liase their fellows to disrupt the operation of the company are liable to penalties under Article 23 of the Public Security Administration and Punishment Law (Article 60).

Signing the collective contract

  1. The workers’ representatives should explain and discuss the draft of the collective contract in the workers’ (representatives) assembly attended by more than two-third of all the workers or workers’ representatives. The draft contract shall be passed by more than half of the attending workers or workers’ representatives (Article 35).
  2. The draft sectoral or regional collective contract shall be discussed and passed in the sectoral or regional workers’ (representatives) assembly or by other democratic means (Article 35).
  3. The agreed draft shall be signed by the first delegates and submit to the labour bureau to be reviewed within fifteen days. Both parties should explain or revise the draft if the labour bureau objects to it or requests further explanations (Article 37 and 39).
  4. The approved collective contract should be disclosed and report to the regional federation of trade unions within ten days from the effective date of the contract (Article 39). A monitoring and review mechanism should be established to enforce the collective contract (Article 40).

Effectiveness and revision of the collective contract

  1. Change of the name, the legal representatives and directors of the company shall not affect the effect of the collective contract (Article 42).
  2. The collective contract may be revised if : a) both sides agree to it; b) the contract cannot be enforced; c) the company goes bankrupt, ceases operation, merges with or it is acquired by another company; or due to other circumstances (Article 43).
  3. Each side may request for a revision of the collective contract and enter into negotiation within seven days (Article 44). Both sides shall agree to it before the collective contract is revised or revoked (Article 45).

Dispute over the collective negotiation

  1. Both side may terminate the negotiation and agree to re-convene the negotiation meeting if no agreement is reached or under unforeseen circumstances (Article 33).
  2. In case of a dispute or disagreement, the labour bureau, the supervisory department of the (state-owned and public) enterprises, the regional federation of trade unions and the employers’ associations should step in to facilitate continuous negotiation, maintain the business operation and labour harmony (Article 46).
  3. Both sides may agree to request the labour bureau for a conciliation or mediation for a resolution if no agreement is reached (Article 47). The conciliation should start within ten days after the request has been made. Conciliators from the tripartite office should be sent to the workplace and collect information from the company, the trade union and the employees. The conciliation should end in thirty days, to be extended by no more than fifteen days. The local government should establish and allocate budget to commission a pool of conciliators for mediation (Article 48).
  4. The conciliation agreement signed by the first delegates is legally binding and it should be enforced by both parties (Article 49).
  5. If there is no conciliation, or if an agreement could not be reached, both side may agree to request a mediation from the labour bureau, and commit to accept and enforce the mediation results (Article 50).
  6. The labour bureau should convene the mediation committee composed of one representative from both sides, one from the tripartite mechanism and one from the labour bureau within five days after receiving the request and conclude the resolution in thirty days (Article 51).
  7. Based on the resolution both sides should agree to revise and sign the collective contract. If a resolution is not reached, the mediation committee should send the written resolution to both side within sixty days (from the date of receiving the request for mediation) and display it at the workplace (Article 53).
  8. For state-owned enterprises, the supervisory department should facilitate the conciliation and mediation, and proceed to request the labour bureau for conciliation and mediation if it fails to reach an agreement between both sides (Article 54).
  9. The trade union may proceed for labour arbitration and litigation if there is a dispute over the enforcement of the collective contract and no mediation has been agreed.

Essential services
Loose definition of essential services for state suspension of industrial actions and vague compensatory mechanism for effective negotiation
The local government is allowed to impose a cool-off period and make a back-to-work order if a stoppage of work or go-slow takes place in enterprises of the following public service sectors, or in their subsidiary companies namely, the water, electricity and gas supply, public transportation, broadcast and communication, public health and hygiene, hospital and medical service sectors etc. Considerations should be given if a) public security is affected; b) the social and economic and people’s routines are affected; and c) public interest is harmed.
In return, the labour bureau, the supervisory department, the regional federation of trade unions and the employers’ associations should facilitate both side for a negotiation. Nevertheless, the public security bureau is allowed to give penalty if the cool-off period is not observed and public security interest has been affected (Article 56).

Legal responsibilities

Government and trade union officials found to have malpractices, misappropriations and abuse authority are subject to disciplinary actions by the supervisory department, or criminal liabilities.

 
IHLO

16 Oct, 2013

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