Draft law on work permits raises questions

A new draft law regarding work permits for foreigners has raised questions regarding the safety and rights of foreigners working in China.

According to the draft law, Chinese courts will not protect the welfare or other labor rights of foreigners working without a valid work permit, even if those workers have signed a formal contract.

Despite being formulated in an effort to prevent foreigners working without valid documentation, the draft may have overlooked several systemic problems related to the issuing and renewal of work permits; problems that seemingly cannot be legislated for.

Much has been said about the country's new exit-entry law, due to take effect on July 1, 2013.

Ultimately, the law represents a sensible move towards updating the country's immigration laws to reflect the prevailing environment.

Under Article 42 of the new entry-exit law, "various departments under the State Council will formulate and periodically adjust a 'guidance catalog' regarding the country's need for foreign workers, taking into account economic and social development needs, as well as the supply and demand for human resources".

However, this list has yet to be published and sectors remain unaware as to what the impact will be upon their ability to employ foreign workers.

Under the new law, fines of 5000 to 20,000 yuan can be imposed upon foreigners working illegally, with the added possibility of detention ranging from 5 to 15 days.

Furthermore, companies can be fined 10,000 yuan for every illegally employed foreign worker, up to a maximum of 100,000 yuan.

The so-called "guidance catalog" may limit the ability of companies operating within certain sectors from hiring foreigners, while the increased fines are designed to deter these same companies from attempting to do so regardless of the quotas/limitations imposed.

Already, companies within the capital are wary of employing foreign workers who currently reside in the country indefinitely on business visas. By this time next year, the punishment for doing so will be increasingly steeper.

These measures represent reasonable steps towards a more sound system of immigration, on a par with countries like Britain and America.

Furthermore, China's social insurance system has now been extended to include foreign workers; despite the fact that it may have been done so a little too hastily.

Legally employed foreigners participate in the country's social insurance system on a mandatory basis unless their home countries have signed prior social insurance agreements with the Chinese government.

To benefit from the social insurance scheme, which is still being questioned regarding the fact that it appears to be in direct contradiction with the current law regarding foreigners' ability to be unemployed or retire in China, foreigners must be employed legally; i.e. they must have gained employment with a valid work permit.

As a result, foreign employees will be able to receive medical, work injury, retirement, unemployment and maternity benefits similar to those for Chinese citizens.

It comes as no surprise then that the government would be keen to clarify that if foreign visitors do not comply with the rules, they will not be able to benefit from the system.

Foreigners with valid work permits are able to handle disputes in accordance with the Labor Law of the People's Republic of China.

During such disputes, the parties involved can apply for mediation, arbitration or take legal proceedings according to the law.

The arbitration procedure is a prerequisite in a labor dispute case before proceeding to the courts, and is a favored path due to the speed and efficiency offered in contrast to Chinese courts.

At present, courts across the country approach labor disputes involving illegally employed foreigners differently, adding to the lack of uniformity and confusion within the current system. In certain instances, labor disputes have been treated as civil cases.

The new draft concerning the need for foreigners to obtain legal work permits is a reasonable addition to the immigration law, however, it overlooks the fact that many foreign workers find themselves in trouble not because of their inability to comply with the law, but rather due to the whims of previous employers.

When legally employed foreign workers change employers in China, the employee must transfer his or her work permit to the new employer.

In order to do this, proper documentation must be obtained from the previous employer.

The procedure appears to be a simple one but the practice provides an incentive for employees to maintain good relations with their previous employer in order for the process to run smoothly.

If the terms of a labor contract have not been violated, the employer is legally obliged to provide such documentation; though this is not always the case.

Furthermore, if the relationship between the two parties has soured, the previous employer will be in no rush to provide such documentation, despite the fact that foreign workers have a limited period within which to modify the status of his or her visa or face having to leave the country immediately.

For foreigners faced with this dilemma, they will have to decide whether to leave a country in which some may have been intending to stay indefinitely, or accept employment elsewhere.

If the new draft law is passed, people in the aforementioned situation will effectively be at the mercy of their new employer and have no legal recourse should a dispute arise.

Despite the fact that all foreigners working in China should indeed possess all the required legal paperwork, as is required in other countries, there should be safeguards in place for those who attempt to continue their careers in the country legally, but are prevented from doing so due to the caprice of previous employers.