Recruiting in China

THE proportion of labor disputes involving private enterprises has dropped for the first time since 2003, according to the Shanghai Labor and Social Security Bureau.

Though a majority of labor disputes still involved private firms, accounting for 40 percent of the total number in the first half, it fell by 11.7 percent compared to the same period last year, the bureau said in its report for the first half of the year released yesterday.

"The number of cases involving privately-owned companies has seen a 20 percent increase in recent years, since many private enterprises were just starting up," Sui Wei, director of the bureau's arbitration division, suggested.

"But the decreased percentage this time implies that employers now have a better awareness of the labor law and pay more attention to protecting employees' rights," Sui said.

The arbitration division received 15,712 disputes in the first half of the year, of which 13,424 were cleared, a 16 percent increase from last year.

The number of disputes involving foreign-invested companies and those from Hong Kong, Macau and Taiwan rose by three percent, accounting for 23 percent of total disputes.

Meanwhile, stockholding companies saw their case number rise about four percent, making up 15 percent of the total.

According to the division, most of the disputes revolved around wages, social insurance and contract termination.

Among the 4,085 cases arbitrated in the first half, 34 percent were won by employees.

The report also estimated that social insurance disputes could rise next year, because a new labor law will go into effect on January 1, 2008.

The new law stipulates that employees can end their contract if companies fail to hand in standard social security fees.

"In such cases, firms violating the law should pay compensation to employees," said Sui.