The issue of severance payment for employees restructured in state owned enterprises

1. What is the economic compensation for employees after the restructuring of the enterprise?

1. The standard of severance payment for employees should be consistent with the average monthly wage of the enterprise under normal production conditions in the 12 months before the termination of labor relations; If the average monthly wage of employees exceeds the average monthly wage of the enterprise, it shall be determined according to the standard of not more than 3 times; If the average monthly wage of employees is lower than the average monthly wage of the enterprise, it shall be determined in accordance with the average monthly wage of the enterprise.

2. Legal basis: Article 47 of the Labor Contract Law of the People's Republic of China.

Calculation of severance compensation] Severance compensation shall be paid to the worker according to the number of years of service in the employer and one month's salary for each full year. where it is more than six months but less than one year, it is calculated as one year; If it is less than six months, the worker shall be paid half a month's salary. If the monthly wage of a worker is three times higher than the average monthly wage of the employee in the previous year announced by the people of the municipality directly under the Central Government or the city divided into districts where the employer is located, the standard of severance shall be paid to him at the rate of three times the average monthly wage of the employee, and the maximum period of payment of severance shall not exceed 12 years.

The term "monthly wage" mentioned in this article refers to the average salary of an employee in the 12 months prior to the termination or dissolution of the labor contract.

2. Under what circumstances should the employee be paid severance compensation?

Economic compensation shall be given in accordance with the relevant provisions of the State. Specifically, it includes the following situations:

1. The employer terminates the labor contract in violation of the law;

2. The employer terminates the labor contract by the parties to the labor contract through consultation;

3. The employer terminates the de facto labor relationship in advance;

4. The employer compels labor by means of violence, coercion or illegal restriction of personal freedom, or the employer fails to pay labor remuneration or provide working conditions in accordance with the labor contract, resulting in the resignation of the employee;

5. The employer fails to pay labor remuneration or provide working conditions in accordance with the labor contract, resulting in the resignation of the employee;

6. The employer refuses to pay overtime wages or pays wages to workers below the local minimum wage standard;

7. The labor contract is terminated because the worker is sick or injured not due to work, and the labor appraisal committee confirms that he cannot perform the original job or the work arranged by the employer;

8. If the worker is incompetent for the job, and is still incompetent for the job after training or job adjustment, the employer shall terminate the labor contract.

To solve the problem of employee severance payment, it involves the standard of severance payment. According to the nature of the restructuring entity, the status of its employees is also different, so the standard of severance for the termination of the labor contract is also different.

1) The general standard of economic compensation for employees of state-owned enterprisesFor state-owned enterprises that have been restructured in accordance with normal procedures, according to the spirit of Document No. 313 of 2002 of Finance and Enterprises, the economic compensation paid by the enterprise shall be implemented in accordance with the provisions of the people's standards at or above the county level where they are located; If there is no standard, it shall be implemented in accordance with the standard stipulated in the document No. 481 issued by the Ministry of Labor in 1994. Although the economic compensation standards issued by various localities vary to a certain extent, their main provisions refer to the relevant provisions of the 1994 Qisan Document No. 481 issued by the Ministry of Labor. Document No. 1994 No. 481 issued by the Ministry of Labor stipulates that the worker shall be paid a severance equivalent to one month's salary for each full year of service in the employer according to the number of years he or she has worked in the employer.

If the working time is less than one year, severance shall be paid at the rate of one year. The wage calculation standard of severance payment refers to the average monthly wage of the employee in the 12 months prior to the termination of the labor contract under the normal production conditions of the enterprise. Among them, if the average monthly salary of employees is lower than the average monthly salary of the enterprise, it shall be calculated and paid according to the average monthly salary of the enterprise; If the average monthly salary of an employee is 3 times or more than 3 times the average monthly salary of the enterprise, it can be calculated and paid according to the standard of not more than 3 times the average monthly salary of the enterprise.

The operators of loss-making enterprises should also follow the above measures.

2) The standard of severance for employees of bankrupt enterprisesState-owned enterprises are seriously insolvent and no longer have the conditions to continue production and operation, and may apply for bankruptcy, but the Bankruptcy Law does not include the payment of severance payments for employees in the scope of statutory repayment of bankrupt enterprises. In accordance with the relevant provisions of the Notice on Issues Concerning the Trial Implementation of the Bankruptcy of State-Owned Enterprises in Several Cities and the Supplementary Notice on Issues Concerning the Trial Implementation of the Merger and Bankruptcy of State-owned Enterprises and the Reemployment of Employees in Several Cities, the expenses for the resettlement of employees of bankrupt enterprises in pilot cities shall be paid from the income from the transfer of land use rights obtained by the bankrupt enterprises in accordance with the law, and the insufficient part shall be allocated from the income from the disposal of other bankruptcy estates and may be included in the first order of repayment. In principle, the standard of resettlement expenses shall be calculated at three times the average salary income of the employees of the enterprise in the pilot city where the bankrupt enterprise is located in the previous year.

7. Economic compensation for employees of restructured enterprises.

1) If a state-owned enterprise is restructured into a non-state-owned enterprise, and the new enterprise is able to provide corresponding jobs, and the original labor contract of the employee is transferred to the new enterprise for continued performance (if the original labor contract has not been performed for less than 3 years, it shall be extended to 3 years), the original enterprise shall not pay economic compensation, and the working years of the employees in the original enterprise shall be continuously calculated as the working years of the new enterprise. When the new enterprise terminates the labor contract with the employee, the employee shall be given severance in accordance with the relevant provisions of the termination of the labor contract together with the employee's working years in the original enterprise and the new enterprise. The severance payment shall be paid by the original enterprise or its investors and the new enterprise in stages according to the employee's working years in the original enterprise and the new enterprise.

The original enterprise or its investor may agree with the new investor that the severance shall be paid by the new enterprise. The original enterprise or its investors shall negotiate and sign an agreement with the new investor or the new enterprise to clearly stipulate the relevant matters concerning the payment of economic compensation.

2) When a state-owned enterprise is restructured, if the new enterprise is unable to provide corresponding jobs for the employees of the original enterprise, or if the employees of the original enterprise are unwilling to participate in the restructuring and seek employment on their own, the original enterprise shall terminate the labor contract with the employees and pay economic compensation in accordance with the law.

3) For a restructured corporate enterprise, if the nature of the enterprise changes from state-owned to non-state-owned due to changes in state-owned equity, if the enterprise cannot continue to provide corresponding jobs for its employees, the enterprise shall terminate the labor contract with the employees and pay economic compensation in accordance with the law; If the enterprise continues to provide corresponding jobs for its employees, both the enterprise and the employees shall continue to perform the labor contract.

4) The standard of economic compensation for enterprise restructuring. Employees shall be paid economic compensation equivalent to one month's salary (referring to the average monthly salary of the 12 months before the termination of labor relations) for each full year of service in the enterprise. If the average monthly wage of an individual employee is lower than the average monthly wage of the enterprise, it shall be paid according to the average monthly wage standard of the enterprise.

If the average monthly salary of an individual employee exceeds 3 times the average monthly wage of the enterprise, it shall be paid according to the standard of not more than 3 times the average monthly salary of the enterprise. It can be seen that the severance in the restructuring is mainly for the main purpose of ensuring the livelihood of employees If you are a national ownership status, if you buy out the status, you can have 14 years of economic compensation, and more than 6 months can be calculated as one year If you are a hired employee, the {labor law} will apply, and the compensation shall not exceed 12 years.

For state-owned enterprises that have been restructured in accordance with normal procedures, they will be paid an economic compensation equivalent to one month's salary for each full year of service in the company. If the working time is less than one year, severance shall be paid at the rate of one year.

Legal basis: Article 47 of the Labor Law of the People's Republic of China Economic compensation shall be paid to the worker according to the number of years of service in the unit and the standard of one month's salary for each full year. where it is more than six months but less than one year, it is calculated as one year; If it is less than six months, the worker shall be paid half a month's economic compensation.