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szdaily -> Shenzhen -> 
Firm fined more than ¥50,000 over delayed salaries
    2021-07-21  08:53    Shenzhen Daily

GUANGDONG Provincial Higher People’s Court has voided a labor contract between a Shenzhen company and one of its employees for delayed payment of salaries and ordered the company to compensate 54,481.70 yuan (US$8,409).

The employer, a machinery company in Shenzhen, signed a labor contract with an employee surnamed Mo that stipulated the company give out the monthly payroll every 20th day of the following month. Mo brought the company to court, accusing the company of failing to give out full salary in time according to law and demanding compensation for dissolving the contract.

At the second trial at Shenzhen Municipal Intermediate People’s Court, the court ruled in favor of Mo, ordering the company to pay a compensation of 54,481.70 yuan. The company appealed to Guangdong Provincial Higher People’s Court, saying that the salaries were paid in time according to the contract and the Shenzhen court did not consider the enterprise’s real situation.

The Guangdong Provincial Higher People’s Court ruled the contract was void because its payment clause violated the labor laws. Shenzhen’s salary regulations stipulate that the time of monthly salary payment agreed between employers and employees should not be later than the seventh day after each month. Therefore, the court supported Mo’s demand to dissolve the contract. Based on Mo’s average monthly salary and years of work, the company needed to compensate Mo 54,381.70 yuan for dissolving the contract.

Lawyer Lyu Shengzhu of Guangdong Shengling Law Firm said, according to Shenzhen salary payment regulations, employers can give wages or salaries at an agreed date. If the employer cannot provide salaries on the specified date due to unforeseen reasons, payment could be extended by five days. If the employer wanted to extend for more than five days on grounds such as operation difficulties, the employer must get written consent from the workers or unions representing the workers. But the payment extension for the monthly salary should be no more than 15 days.

On May 27, an amendment on extending the salary payment was handed to lawmakers for review. The draft amendment proposed to extend the date of payment to within a month of the agreed date of payment and could give wiggle room for employers.

In preliminary reading of the draft, lawmakers thought the payment date could be extended for no more than 20 days, considering the interest of the employees and situation of enterprises, some of which, especially small- and medium-sized enterprises, face operation difficulties. An extension of more than five days needs to get employees’ written approval. 

(Han Ximin)

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