Nearly all employers know signing a written employment contract is very important. However, not all of them realize that preparing an Employee Handbook is actually more important.

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1) Content of employee handbook

Generally speaking, an employment contract is kind of a standardized paper， as it is supposed to contain the following clauses:

(1) Both party’s name, residence, and other important information;

(2) Term & probation;

(3) Work contents and location;

(4) Work time, rest and vocation;

(5) Remunerations & social security;

(6) Labour protection & prevention of occupational harm etc.;

All the above-mentioned matters have to follow PRC labour laws and regulations, otherwise, the specification is invalid since it violates laws. So actually, the employer doesn’t have many alternatives when preparing an employment contract.

However, an employee handbook is different. It not only embodies the enterprise’s culture but also sets a specific standard of behaviour for employees. In other words, it specifies what you should do, what can’t do as an employee and the corresponding consequence of failing to comply with it. In this sense, it’s very important to strengthen the daily management of the enterprise.

2 ) The function of employee handbook’s

employee handbook could be very important
A typical employee handbook could contain the enterprise’s management regulations, among other things, such as the statement of the enterprise’s culture and vision planning. Specific and detailed management regulations are very important for the HR and administrative management of the enterprise. Such as basic requirement for employee, recruitment procedure, a probation period, leaves procedure, dissolution of a labour contract, incentive system & discipline, confidential and proprietary information and code of ethical conduct, etc. The enterprise could specify every issue related to employee management in an employee handbook.

More important is, the enterprise could specify clearly what kind of behaviour is not allowed or forbidden. Any violation of these specifications could lead to an oral or written warning or even dismissal of the offensive employee.

3. Procedure for an effective employee handbook

Though the employer is the one who prepares the employee handbook, employees’ involvement is also important for an employee handbook to be binding.

According to Labor Contract law of PRC, if any employer’s regulations are in direct relation to the benefits of employees, such as remuneration, working time, social insurance and welfare, training, work discipline or quota management, the draft of such regulations shall be discussed at the employee’ congress or by all the employees, and shall be determined after consultation.

Then, the employers shall publicize the employee handbook and make sure each employee understands the content once it is finalized.

Please be noted that Labor law of PRC emphasizes a lot on the procedure, and it is important for the employer to comply with the procedural requirement. This principle applies to enterprise regulations too. Any above-mentioned regulations will not be authorized as “valid” if the employer failed to follow the procedure. Especially where there is a labour dispute if the enterprise can’t prove the employee’s involvement and awareness of the employee handbook, neither the arbitration committee nor court would think it valid at all.

That’s why we usually advise our clients to keep the minutes of discussion and consultation of the employee handbook and make sure each of their employees to sign an acknowledgement of the employee handbook and stating that they totally understand all the clauses in the employee handbook.

Otherwise, the employer will find they are in deep trouble someday!

Source: Sophie Mao from ChinaLawHelp.com

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