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Regulations for the Autonomous Right of the Enterp
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1986.11.10
MINISTRY OF LABOUR & PERSONNEL
 REGULATIONS  FOR  THE AUTONOMOUS RIGHT OF THE ENTERPRISES WITH
FOREIGN INVESTMENT TO EMPLOY PERSONNEL, THE WAGES AND SALARIES, AND
THE EXPENSES FOR INSURANCE AND WELFARE BENEFITS FOR STAFF MEMBERS AND
WORKERS
 (Issued  and  Promulgated by the Ministry of Labor and Personnel on
November 10, 1986)
 The  following  provisions  are  hereby formulated in order to
implement the Provisions  of  the  State  Council  Regarding the
Encouragement  of  Foreign Investment,  guarantee  the  right  of
autonomy of Enterprises with Foreign Investment in the hiring of
personnel, and to appropriately determine the wages and insurance
and welfare expenses for staff and workers from the Chinese party:
 (1)  On the Right of Autonomy of Enterprises with Foreign Investment
in the Hiring of Personnel.
 (a)  An  Enterprise  with Foreign Investment may, in accordance
with its production  and  operation  requirements,  determine  on
its  own  the organizational  structure  and personnel system, and,
with the assistance of the labor and personnel department in its
locality, recruit and employ staff and workers on its own through an
examination and selection process in which only the best (qualified)
are hired.
 In  the  event  that  engineering  and  technical personnel or
operation and management  personnel  needed  by the Enterprise with
Foreign Investment are not available in the locality, the Enterprise
with Foreign Investment may, after the labor and personnel department
in the province, autonomous region or municipality directly under
the Central Government where it is located has consulted with and
obtained  the  consent of the labor and personnel department in the
district concerned, recruit outside the locality.
 (b)  With  respect to the engineering and technical personnel,
operation and management  personnel  and  technical  workers whom
Enterprises with Foreign Investment  have  decided  to hire after
examination, the original units of which  such personnel are in
employment  shall actively give their support and  permit  their
transfer.  In  the  event  of any dispute, the labor and personnel
department in their locality shall adjudicate.
 (c)  Senior  management personnel designated by the Chinese party to
work in Enterprises with Foreign Investment should be persons who are
well oriented in existing policies, technically competent, know how
to manage, ready to accept new challenges and who can cooperate
and  work  together  with the Foreign  Investors.  The  relevant
departments  shall support them in their work and generally shall not
transfer them to other jobs during their term of office. In the
event that they must be transferred, the consent of the Board of
Directors should be obtained.
 (d) With regard to personnel who are not qualified for their posts
after having  completed  the  prescribe probationary or training
period,  and personnel who have become redundant as a result of
changes  in  the production  or  technical  conditions of the
Enterprise  with  Foreign Investment,  the enterprise may dismiss
them. Staff and workers who have violated the rules and regulations
of the enterprise and thereby caused certain bad consequences can,
in  accordance with the seriousness of the case, be given different
penalties up to that of discharge.
(2) On the Wages, Insurance and Welfare Expenses of Staff and Workers.
 (a)  The  wage levels of the staff and workers in an Enterprise with
Foreign Investment  will be determined by the Board of Directors on
the principle that  it  should  not less than 120% of the average
wages of the staff and workers  of state-owned enterprises with
similar conditions, of the same trade and in the same locality;
such levels shall be adjusted gradually according to the economic
performance  of  the  enterprise. Enterprises with good  economic
performance  may  give  bigger wage raises; those with poor economic
performance may give smaller or no raises.
 (b)  An Enterprise with Foreign Investment shall make payments
to the retirement  and pension fund and unemployment insurance fund
for staff and workers from the Chinese party in accordance with the
stipulations  of  the people's  government  in the locality. The
insurance and welfare benefits of staff  and workers during their
employment shall be made in accordance with relevant stipulations of
the  Chinese Government concerning state-owned enterprises; expenses
required  therefor shall be disbursed from the costs and expenses of
the enterprise strictly in accordance with the facts.
 (c)  Enterprises  with Foreign Investment shall make payments to the
housing subsidy  fund in accordance with the stipulations of the
people's  government  in  locality.  The  Chinese  party  to the
enterprise shall use such fund to subsidize  the  costs  of the
building and purchase of housing for staff and workers.




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