Newsletter INS – 28/05/2015

More Safeguards For The Security And Interest Of Overseas Labor Service Personnel

Administrative Regulation of Overseas Labor Service Cooperation (the “Regulation”) which was issued by the State Council, became effective as of August 1st, 2012. The operation of overseas labor service will be managed more stringently and the security and interest of overseas labor service personnel will be better secured.

hover1The Regulation strictly limits the qualification for running overseas labor service and increases the amount of reserve fund from the original RMB 1 million or 200 thousand (depending on the business type of the overseas accepting enterprise) to RMB 3 million.

The Regulation provides meticulous protection of the laborer’s interests. Pursuant to the Regulation, the overseas labor service agency (the “Agency”) shall: (1) inform the labor service personnel of personal risk for overseas work; (2) enter into employment/service contracts with the personnel and file the contracts with competent commercial department for record; and (3) purchase personal accident insurance for the personnel etc.

The Regulation also stipulates that the Agency should assist the labor service personnel to protect their labor rights; and if the remedies are not available, the Agency should recover the loss suffered by the personnel.

Lawyer’s Comments: The Regulation has strict rules on the Agency’s responsibilities and obligations with respect to qualification, reserve fund, labor right, emergency and liability commitment. It also authorizes the competent commercial departments, the administrations for industry and commerce as well as Chinese embassies and consulates to manage and supervise the overseas labor service business.  Especially, the solutions of emergency will contribute to handling overseas kidnapping or assault case involving labor service personnel.