Perspective | Nature of the Recognition of Changing the Expiration Date of the Labor Contract Termination
Published:
2024-12-17
Case: Labor Dispute Case between Huang and a Certain Group Company
Basic Case Facts
On December 31, 2012, Huang entered a certain group company and signed a "Labor Contract" on January 1, 2013, agreeing that the contract period would be from January 1, 2013, to December 31, 2013. After signing the initial fixed-term labor contract, the two parties signed five "Labor Contract Change Agreements" from December 31, 2018, to December 31, 2021, changing the termination date of the labor contract signed on January 1, 2013, to the final date of December 31, 2022.
In May 2018, Huang was diagnosed with left thigh glandular soft tissue sarcoma. From May 21, 2018, to March 1, 2020, he was on leave for treatment, and then returned to work at the group company in March 2020. On December 30, 2022, the group company issued a "Notice of Non-Renewal of Labor Contract" to Huang, notifying that the contract would terminate on December 31, 2022, and that the group company would not renew the labor contract with Huang.
On January 13, 2023, and February 3, 2023, the group company sent a "Notice" to Huang, requesting him to renew the labor contract. However, the two parties did not successfully renew the contract. Subsequently, Huang applied to the arbitration committee, claiming that the group company unlawfully terminated the labor relationship and requested compensation for the unlawful termination of the labor contract, but the committee decided not to accept the case, leading Huang to file a lawsuit in court.
Court Ruling
The court held that the group company extended the termination period of the labor contract with Huang five times in the form of change agreements, which should be regarded as the company having signed no less than five new fixed-term labor contracts with Huang. According to Article 14, Paragraph 2, Item 3 of the Labor Contract Law of the People's Republic of China, after the expiration of the second written labor contract, Huang is entitled to enter into a non-fixed-term labor contract with the group company. If the employer fails to sign a non-fixed-term labor contract when it should, the people's court may consider that there exists a non-fixed-term labor contract relationship between the two parties and determine the rights and obligations based on the original labor contract. Therefore, in this case, Huang and the group company should be regarded as having a non-fixed-term labor contract relationship. In this situation, the company's decision not to renew the contract upon the expiration of the changed termination period is considered an unlawful termination of the labor contract, and it should bear corresponding compensation liability. The court thus ruled that the group company should pay Huang compensation for the unlawful termination of the labor contract in the amount of 151,640 yuan.
Lawyer Analysis
Can the employer's repeated changes to the labor contract be regarded as the signing of a new labor contract?
From the perspective of local judicial guidance, Article 50 of the "Beijing High People's Court and Beijing Labor and Personnel Dispute Arbitration Committee's Answers to Labor Dispute Cases (1)" stipulates that if the employer engages in behaviors to evade the provisions of Article 14 of the Labor Contract Law, the number of fixed-term labor contracts signed by the worker and the length of service should still be calculated continuously.
(1) Forcing workers to terminate or end their labor contracts and then re-signing labor contracts with them to reduce the calculation of their length of service;
(2) Alternating the signing of labor contracts between related employers and workers;
(3) Changing only the termination period of the labor contract without reasonable explanation from the employer;
(4) Using the method of canceling the original unit and establishing a new unit to re-employ workers in the new unit, where the business content of the unit and the worker's work location and content have no substantial changes;
(5) Other behaviors that obviously violate the principles of good faith and fairness.
From the above provisions, this opinion clearly regards the behavior of changing the labor contract period as having continuously signed two fixed-term labor contracts.
According to Article 14, Paragraph 2, Item 3 of the Labor Contract Law of the People's Republic of China, it is clearly stipulated that after the expiration of the second written labor contract, the worker is entitled to enter into a non-fixed-term labor contract with the employer. If the worker does not explicitly refuse to sign a non-fixed-term labor contract with the employer, and the employer fails to sign a non-fixed-term labor contract when it should, the people's court may consider that there exists a non-fixed-term labor contract relationship between the two parties and determine the rights and obligations based on the original labor contract. In this case, if the employer terminates the labor contract with the worker on the grounds of contract expiration, it constitutes an unlawful termination and should bear corresponding compensation liability.
From the court's ruling, the court views such situations as requiring both parties to sign a non-fixed-term labor contract, determining the rights and obligations based on the original contract. Therefore, on the basis of a non-fixed-term labor contract, the company's decision not to renew the labor contract with Huang is essentially equivalent to unlawfully terminating the labor contract without legal grounds, and it should bear economic compensation.
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