FAQs For Employment Matters in Novel Coronavirus Outbreak

State Council announced on January 26, 2020 plans to extend the Spring Festival holiday to February 2, 2002 as a key measure to control the novel coronavirus outbreak. Local governments issued their respective policies to further postpone the resumption of work. Such local policies and the sudden outbreak of novel coronavirus are undoubtedly affecting, and would definitively continue to affect, the business operation, management, labor force and employee protections of the enterprises. We listed most frequently asked questions and their brief answers, mainly based on policies and practices of Shanghai, Beijing and Suzhou, as follows with an aim to provide to enterprises preliminary guidelines for dealing with employment matters in such difficult time. The FAQs are subject to update from time to time according to the development of coronavirus and the change of governmental policies.

1. Extended Spring Festival Holiday: January 31 to February 2, 2020

(1) Is employer required to pay salary during such extended holiday?

Yes, even though employees do not work during such extended holiday.

(2)  How should employer pay salary if it arranges employees to work during such extended holiday?

Employer should arrange compensatory leave for those employees who have worked for novel coronavirus control firstly; when compensatory leave cannot be arranged due to any reason, employer should pay employee for their overtime work not lower than 200% of their base salaries.

(3) Can the extended Spring Festival Holiday be deducted from employees’ annual leave days?

No. February 2, 2020 is Sunday, a rest day, while January 31 and February 1, 2020 are the special holidays that State Council temporarily set up for fighting public health emergency. They are separate from and in addition to employees’ annual leave days.

2. Postponed Resumption of Work: February 3 to February 9, 2020

(4) Is employer required to pay salary during the period of postponement?

Yes, even though employees do not work during such period.

(5) How should employer pay salary if it arranges employees to work during the period of postponement?

Local governments (such as Shanghai, Jiangsu) have announced policies prohibiting enterprises from resuming operations before 24:00 February 9, 2020, except for those whose businesses are closely relating to novel coronavirus fighting or important livelihood of people. If employees are ordered to work from home during such period:

Shanghai: it shall be deemed as work overtime which entitles employees to compensatory leave or an overtime pay not lower than 200% of their base salaries. 

Suzhou: although it will not be automatically deemed as work overtime, local policy encourages employer to grant comforts and incentives; however, for the work during the rest days (Saturday and Sunday and other days determined as rest days by labor contracts or company rules), it shall be deemed as work overtime and employees shall be entitled to overtime pay not lower than 200% of their base salaries or compensatory leave to be arranged within 6 months.

Beijing: it would not be deemed as work overtime, except that employees work during the rest days under which employer is obligated to offer overtime pay or compensatory leave.

(6) Can the period of postponement be deducted from employees’ annual leave days?

(1) February 8 and 9, 2020 are Saturday and Sunday, which are separate from and in addition to employees’ annual leave.

(2) As for the period from February 3 to 7, 2020:

Shanghai: Shanghai labor authority confirmed in a press conference on January 28, 2020 that the period shall be the rest days which, therefore, shall not be counted towards employees’ annual leave.

Suzhou: Suzhou labor authority confirmed that period shall not be counted towards employees’ annual leave.

Beijing: Different from practices in Shanghai and Suzhou, Beijing labor authority defined the period from February 3 to 7, 2020 as a “flexible working period” and it is not clear whether it is deductible from employees’ annual leave. However, we are inclined to believe that the period is also separate from and in addition to employees’ annual leave literally speaking.

3. After Expiration of Postponed Resumption of Work (Namely After 24:00 February 9, 2020)

(7) How should employer pay salary if an employee is diagnosed with novel coronavirus infection and needs isolation treatment?

Shanghai: The employee is deemed to provide normal work service during the isolation treatment period and therefore, entitled to normal salary pay. In the event that the employee rests at home after the treatment, he/she may enjoy sick leave entitlement according to our understanding, although no clear policy is available right now.

Suzhou: Same as Shanghai practice according to Suzhou policy.

Beijing: The employee is deemed to provide normal work service during the isolation treatment period and therefore, entitled to normal salary pay.

(8) How should employer pay salary if an employee is a suspected novel coronavirus patient or a close contact with infectious patients and needs to be placed under isolation or medical observation?

Employer shall pay the employee normal salary during the period of isolation or medical observation.

(9) How should employer pay salary if an employee is not able to resume to work due to isolation or other emergency measures adopted by government?

Employer shall pay the employee normal salary during the period of isolation or medical observation.

(10) Can employer deduct from an employee’s annual leave the period that he/she fails to resume to work for the reason of novel coronavirus outbreak but not specifically due to the situations as listed in above (7), (8) or (9)?

Shanghai: No statutory policy defines such situation. It is a cautious way that employer and the employee agree through consultation to prioritize paid annual leave to cover the period of no work resumption.

Suzhou: Upon agreement with the employee, employer may consider prioritizing paid annual leave to cover the period of no work resumption.

Beijing: Employer may consider prioritizing paid annual leave to cover the period of no work resumption, which, different from Suzhou practice, does not require agreement with the employee. However, if the situation continues for a long time, upon consultation with the employee, employer may suspend his/her work, during which employer is obligated to pay basic living allowances not lower than RMB 1,540 per month. 

4. Are there measures that employer may consider adopting to reduce negative impact from novel coronavirus outbreak?

(11) Can employer lower employees’ remunerations?

According to the Circular promulgated by the Ministry of Human Resources and Social Security, employer may consult with its employees to adopt measures for securing the job positions such as remunerations adjustment, flexible shifts, working hours reduction. Employers who meet the criterion set by the government may be eligible to governmental subsidies for stabilizing job positions.

While the relevant laws and rules require mutual agreement with employees before lowering their remunerations, in such difficult time of preventing and fighting novel coronavirus outbreak, we have reasons to believe that employees will fully understand and be willing to jointly burden, the difficulty, along with their employer as long as both have had a sufficiently transparent and frank communications and consultations.

(12) Can employer suspend operation?

Yes. (i) If the suspension lasts within a salary payment period (for a period no longer than 30 days), employer shall pay its employees normal salaries; (ii) if the suspension lasts for a period exceeding 30 days: (a) employer shall pay its employees salaries not lower than local minimum salary standard as long as they provide normal work service; (b) if employees do not provide any work service, employer shall pay living allowances (living allowances shall not be lower than local minimum salary standard in Shanghai while in Beijing and Suzhou, not lower than 80% of local minimum salary).

5. Work-related Injury Matter Relating to Novel Coronavirus Infection

(13) Can an employee be certified as suffering work-related injury if he/she is diagnosed with novel coronavirus infection in his/her business trip or working place?

According to the current work-related injury regulations, if medical staff and related working personnel suffer novel coronavirus infection or die for the reason of novel coronavirus infection when performing their work responsibilities and duties, they can be certified as suffering work-related injury and therefore, will be entitled to work-related injury benefits.

For an employee other than the above staff and personnel, even if he/she is diagnosed with novel coronavirus infection in his/her business trip or working place, we are inclined to believe that such situations do not meet the criterion of work-related injury as set forth in the related regulations and accordingly he/she will not be able to enjoy work-related injury benefits, unless such employee dies suddenly during his/her working hours and while on the job due to the novel coronavirus infection or dies within 48 hours after futile rescue attempts.