Provisions for Consultation and Mediation of Enterprise Labour Disputes

Article 2: These Provisions shall govern the consultation and mediation of enterprise employment disputes.

Article 3: An enterprise shall implement democratic management systems such as an employees' general meeting, employee representative congress and plant affairs transparency, establish collective bargaining and collective contract systems, and maintain harmonious and stable employment relationships.

Article 4: An enterprise shall establish a labour and management communication and dialogue mechanism and open a channel for workers to voice their interests.

If workers are of the opinion that there are problems in the enterprise's performance of their employment contracts or the collective contract or in the implementation of labour protection laws and regulations or the enterprise's labour rules and regulations, they may refer the same to the enterprise's employment dispute mediation committee (the Mediation Committee). The Mediation Committee shall, in a timely manner, verify the situation and coordinate with the enterprise in rectifying the matter or explaining the matter to the workers.

Workers may also submit other reasonable complaints to the enterprise through the Mediation Committee. The Mediation Committee shall, in a timely manner, forward the same to the enterprise and give feedback thereon to the workers.

Article 5: An enterprise shall strengthen its solicitude towards its workers, take the complaints of workers to heart, show concern for their mental health, guide workers in rationally protecting their rights and prevent the occurrence of employment disputes.

Article 6: When employment disputes are being resolved through consultations and mediation, the same shall be done based on the facts and the relevant laws and regulations, while abiding by the principles of equality, free will, lawfulness, impartiality and timeliness.

Article 7: A human resources and social security department shall guide enterprises in carrying out the prevention and mediation of employment disputes and shall perform the following specific responsibilities:

(1) guiding enterprises in abiding by labour protection laws, regulations and policies;

(2) procuring the establishment by enterprises of employment dispute prevention and forewarning mechanisms;

(3) coordinating the organisation and establishment by labour unions and enterprise representatives of emergency mediation and coordination mechanisms for major collective labour disputes, and jointly promoting enterprise employment dispute prevention and mediation work; and

(4) inspecting the organisation building, system building and team building of Mediation Committees in its jurisdiction.

Part Two: Consultations

Article 8: When an employment dispute arises, either party may attempt to resolve the same through consultations by meeting, discussing, etc. with the other party.

Article 9: A worker may request that the labour union of his/her enterprise participate in or assist him/her in the consultations with the enterprise. The labour may also participate in the resolution of employment disputes through consultations at its own initiative to safeguard workers' lawful rights and interests.

A worker may appoint another organisation or individual to represent him/her in the consultations.

Article 10: When either party makes a request for consultations, the other party shall actively respond orally or in writing. If the other party does not respond within five days, it/he/she shall be deemed as not agreeing to enter into consultations.

The length of the consultation period shall be determined by the parties in writing, and if no consensus is reached by the end of the agreed-upon period, the consultations shall be deemed as unsuccessful. The parties may agree in writing to extend the period.

Article 11: If a consensus is reached through the consultations, the parties shall execute a written settlement agreement. The settlement agreement shall be binding on both parties, and they shall perform the same.

If, following review by an arbitration tribunal, it is determined that the settlement agreement procedure and the provisions of such agreement was/are lawful and valid, the arbitration tribunal may use such agreement as evidence. However, disputed facts accepted by a party as a compromise in order to achieve a settlement cannot serve as evidence against it/him/her in any subsequent arbitration.

Article 12: If, after an employment dispute has arisen, the parties are not willing to hold consultations, the consultations are unsuccessful, or either party fails to perform within the agreed upon period of time the settlement agreement that was reached, an application for mediation may be made in accordance with the law to the Mediation Committee or the rural or neighbourhood employment and social security service centre or other such lawfully established mediation organisation or, alternatively, an application for arbitration may be made in accordance with the law to an employment and public personnel arbitration commission (Arbitration Commission).

Part Three: Mediation

Article 13: A medium or large-sized enterprise shall establish a Mediation Committee in accordance with the law, and assign full-time or part-time working personnel thereto.

An enterprise that has branch companies, branch stores or branch plants may, as needed, establish Mediation Committees in such branches. The Mediation Committee of the head office shall guide the Mediation Committees of the branches in carrying out the prevention and mediation of employment disputes.

A Mediation Committee may, as needed, establish mediation teams in the workshops, workshop sections or work groups/teams.

Article 14: A small or micro enterprise may establish a Mediation Committee or, alternatively, the workers and enterprise may select a person or persons to carry out mediation work.

Article 15: A Mediation Committee shall comprise representatives of the workers and representatives of the enterprise, with their numbers determined by the parties through consultations. Each party shall have an equal number of representatives. The representatives of the workers shall consist of members of the labour union committee or be elected by all of the workers, and the representatives of the enterprise shall be designated by persons in charge of the enterprise. A member of the labour union committee or a person selected by the parties shall serve as the chairman of the Mediation Committee.

Article 16: A Mediation Committee shall perform the following responsibilities:

(1) publicising labour protection laws, regulations and policies;

(2) mediating employment disputes that arise within the enterprise;

(3) monitoring the performance of settlement agreements and mediation agreements;

(4) engaging, dismissing and managing mediators;

(5) being involved in and coordinating issues that arise in the performance of employment contracts and the collective contract and in the implementation of the enterprise's labour rules and regulations;

(6) participating in the discussion of major cases that involve the immediate interests of the workers; and

(7) assisting the enterprise in establishing an employment dispute prevention and forewarning mechanism.

Article 17: A mediator shall perform the following responsibilities:

(1) paying attention to the employment relationships in the enterprise and reporting thereon to the Mediation Committee in a timely manner;

(2) upon assignment by the Mediation Committee, mediating employment dispute cases;

(3) monitoring the performance of settlement agreements and mediation agreements; and

(4) completing other tasks assigned to him/her by the Mediation Committee.

Article 18: A mediator shall be fair, upright, in touch with the general workers, dedicated to mediation work and have significant knowledge of labour protection laws and policies and communication and coordination skills. Mediators shall be working personnel of the enterprise engaged by the Mediation Committee and all of the Mediation Committee's members shall be mediators.

Article 19: A mediator's term of engagement shall be at least one year and shall be renewable. If a mediator is unable to perform his/her mediation responsibilities, the Mediation Committee shall make an adjustment in a timely manner.

Article 20: A mediator shall perform his/her mediation responsibilities in accordance with the law, and if he/she needs to use production or working hours in the performance thereof, the enterprise shall support him/her and treat the same as regular attendance for work.

Article 21: When an employment dispute arises, a party may submit a mediation application to the Mediation Committee either orally or in writing.

The application for mediation shall include the basic particulars of the applicant, the mediation claims, facts and grounds.

If an application is made orally, the Mediation Committee shall record the same on the spot.

Article 22: If, after it receives a mediation application, the Mediation Committee determines that the matter falls within the scope of acceptance as an employment dispute and the parties agree to mediation, it shall accept such application within three working days. If the matter does not fall within the scope of acceptance as an employment dispute or either of the parties does not agree to mediation, it shall duly make a record thereof and notify the applicant in writing.

Article 23: If, after an employment dispute arises, neither party applies for mediation, the Mediation Committee may, after securing the consent of the parties, initiate mediation at its own initiative.

Article 24: In general, mediation of an employment dispute by a Mediation Committee shall not be conducted publicly, unless the parties request that it be so conducted.

Article 25: A Mediation Committee shall, depending on the circumstances of a case, designate a mediator or mediation panel to conduct the mediation. Subject to the consent of the parties, it may also invite relevant entities and individuals to assist in the mediation.

A mediator shall comprehensively listen to the statements of the parties, adopt flexible and varied means and methods, and carry out patient and detailed persuasion and guidance work to assist the parties in achieving a mediation agreement of their own will.

Article 26: If a mediation agreement is achieved through the mediation, the Mediation Committee shall prepare a written mediation agreement. The written mediation agreement shall state the basic particulars of the parties, the mediation claims, the outcome of the mediation and the term and method of performing the agreement.

The written mediation agreement shall be signed or stamped by the parties and shall enter into effect once signed by the mediator and the stamp of the Mediation Committee is affixed thereto.

A written mediation agreement shall be made in triplicate, of which the parties shall each hold one copy and the Mediation Committee one copy.

Article 27: An effective mediation agreement shall be binding on the parties and the parties shall perform the same.

The parties may, within 15 days from the date on which the mediation agreement entered into effect, jointly submit an application to the Arbitration Commission for arbitral review. Once it has accepted the application, the Arbitration Commission shall conduct the review and, pursuant to Article 54 of the Rules for Handling Arbitration Cases Involving Employment and Public Personnel Disputes, issue a written mediation statement if the procedure and provisions of the mediation agreement are lawful and valid.

Article 28: If the parties did not apply for arbitral review in accordance with the preceding Article and either of the parties fails to perform the mediation agreement by the specified deadline, the other party may apply for arbitration in accordance with the law.

After it has accepted the arbitration application, the Arbitration Commission shall review the mediation agreement, and if the mediation agreement is lawful, valid and does not harm the public interest or the lawful interests of a third party, the Arbitration Commission may, in the absence of any new evidence, render an arbitration award on the basis of the mediation agreement.

Article 29: When a Mediation Committee mediates an employment dispute, it shall conclude the same within 15 days from the date of acceptance of the mediation application. However, if the parties agree to an extension, it can be extended.

If a mediation agreement is not reached within the period specified in the preceding paragraph, the mediation shall be deemed unsuccessful.

Article 30: If the parties do not agree to mediation, the mediation is unsuccessful, or either party fails to perform the mediation agreement within the agreed upon period of time, the Mediation Committee shall duly make a record thereof, which shall be signed or stamped by the parties, and the parties shall be informed in writing that they may apply to an Arbitration Commission for arbitration.

Article 31: If any of the following circumstances arises and the same constituted an interruption of the time limit for arbitration as specified in Article 10 of the Rules for Handling Arbitration Cases Involving Employment and Public Personnel Disputes, counting of the time limit for arbitration shall resume from the time of the interruption:

(1) after one of the parties makes a request for consultations, the other party is not willing to enter into such consultations or fails to give a response within five days;

(2) during the agreed-upon period for consultations, one or both parties is/are unwilling to continue the consultations;

(3) a consensus is not reached during the agreed-upon period for consultations;

(4) after a settlement agreement is reached, one or both parties fail(s) to perform the settlement agreement by the agreed-upon deadline;

(5) after a party submits an application for mediation, the other party does not agree to mediation;

(6) after the Mediation Committee has accepted the mediation application, one or both parties do(es) not agree to mediation by the deadline specified in Article 29;

(7) a mediation agreement is not reached by the deadline specified in Article 29; or

(8) after a mediation agreement is reached, either of the parties fails to perform the mediation agreement by the agreed-upon deadline.

Article 32: A Mediation Committee shall establish sound systems, such as those for mediation registration, mediation recording, performance monitoring, file management, vocational training, statistics reports and work assessment.

Article 33: An enterprise shall support the Mediation Committee in carrying out its work, provide it office space and ensure its working funds.

Article 34: If an enterprise fails to establish a Mediation Committee in accordance herewith and employment disputes or mass events frequently occur, affecting employment relationship harmony and causing a major social impact, the human resources and social security department at the county level or above shall report the same. If a violation of laws or regulations is constituted, the matter shall be dealt with in accordance with the law.

Article 35: If, in the course of mediation, a mediator commits a gross dereliction of duty, a violation of the law or a breach of discipline, infringing the lawful rights and interests of the parties, the Mediation Committee shall dismiss him/her.

Part Four: Supplementary provisions

Article 36: When a private non-corporate entity or an association attempts to resolve employment disputes through consultations and mediation, it shall handle matters with reference to these Provisions.

Article 37: These Provisions shall be effective as of January 1 2012.