A foreign invested company usually issues an offer to a to-be-hired candidate before entering into a labor contract. However, due to some reasons, the company might not want this suitable candidate to join the company after he/she accept an offer. If the candidate does not accept the company’s decision, the dispute will arise.
If the dispute arises, may the candidate rely on the PRC Employment Contract Law(“ECL”) to request the company to fulfill the obligation under the ECL, such as entering into written labor contract, providing workplace or work conditions, and paying salary according to the offer and so on?
The ECL does not clearly stipulate how to handle such dispute. We are inclined to believe that the candidate is not entitled to count on the ECL to claim his/her right under the ECL due to Article 7 of the ECL.
Article 7 of the ECL says the employment relationship between an employer and an employee shall be established from the date on which the employer begins to use the employee. Thus, if the company does not begin to use the employee and the employee does not actually provide work for the employer, the employment relationship should not yet be established and the ECL therefore should not be triggered.
In the aforesaid scenario, the candidate just received an offer from the company and does not yet provide actual work to the company and the company does not begin to use the employee either. Thus, according to Article 7 of the ECL, the candidate may not rely on the ECL to request the company to fulfill the obligation under the ECL. The candidate is only allowed to count on the PRC Contract Law to claim his/her losses incurred in connection with the breach by the company of the offer.
By Adam Li