Translated from China Business News

The amendment of the Labor Contract Law in early August attracted more than 550,000 suggestions, a record high in Chinese modern legal history.

Most of the suggestions concerned the definition of “labor dispatch”, or temporary labor, because many employers are abusing this confusing item and saving money by hiring a large number of casual laborers.

Casual laborers have become the main source of labor in some regions. Under the old law, factory owners did not need to pay for these workers’ social and medical insurance.

But the new amendment explicitly stipulates that casual labor should not become the main labor channel and all temporary laborers should enjoy payments, including all welfare and benefits, equal to their permanent counterparts.

This will be a milestone in China’s Labor Contract Law, if it can be effectively implemented. Even if this amendment increases the labor costs of enterprises in the short term, it will encourage employers to improve the quality of their employees’ conditions in the long run.

They will take workers seriously because each of them costs money. So many labor disputes could be avoided.

The establishment of the modern labor contract system and legal supervision are necessary steps in transforming China’s economic growth model and upgrading its industrial structures.

No modern industries should be based on cheap labour.