⊙ This article is about 4000 words long and it takes 11 minutes to read Source of this article: King & Wood Research Institute, Peking library Author: Liang Yanling, Ma Sasa, Su Jia #01 Case and judgment rules analysis 1. Case introduction In January 2011, Fang established a labor relationship with an insurance company. On December 29, 2017, due to organizational structure adjustment and the abolition of the Strategic Planning Department, the company unilaterally terminated its labor relationship with Fang on the grounds that there have been major changes in the objective situation and that the two parties failed to reach an agreement on the change of the labor contract . Fang then filed a labor arbitration with the Labor and Personnel Dispute Arbitration Committee of Huangpu District, Shanghai, requiring the company to continue to perform the labor contract and pay him the 2017 year-end bonus and other funds. Regarding the year-end bonus, one of the focus of the dispute in this case, company argued that , the bonus will generally be paid around March of the following year, and the company's "Employee Manual" (which has been signed and confirmed by Fang's signature) clearly stipulates that the year-end bonus is paid according to the company's policies, based on the company's performance and employee performance. If an employee resigns within the month of the bonus payment, he cannot be enjoyed. Fang resigned before the year-end bonus was issued, so he should not enjoy such year-end bonuses. The arbitration committee of this case and the first instance court of Huangpu District, Shanghai, both supported the company's above-mentioned claim , believing that the year-end bonus is a system in which the company rewards employees based on the economic benefits of the year and the work performance of employees. The company has certain autonomy, and Fang's resignation is a situation that will not be distributed as clearly stipulated by the company's bonus distribution rules, so the company does not need to pay Fang's 2017 bonus. However, the second instance court overturned the aforementioned determination of year-end bonus by the first instance court and ruled that the company should pay Fang's 2017 annual bonus. 2. Key points and analysis of referees " If a worker who resigns before the year-end bonus is issued claims that the employer pays the year-end bonus, the people's court shall comprehensively consider the reasons for the employee's resignation, time of departure, work performance, and degree of contribution to the unit. The employer's rules and regulations stipulate that workers who resign before the year-end bonus are not allowed to enjoy the year-end bonus, but the termination of the labor contract is caused by the employee's unilateral negligence or voluntary resignation, and the employee has completed the annual work tasks, the employer If it cannot be proved that the work performance and performance of the worker does not meet the annual bonus payment standards, and if the worker who resigns before the year-end bonus claims that the employer pays the year-end bonus, the people's court should support it. " In this case, although the company's rules and regulations have clear provisions on "employees who resign before the bonus is paid, they are not entitled to enjoy the bonus", , the second instance court held that , Fang did not voluntarily resign or was dismissed by negligence, but because the company adjusted its organizational structure, Fang's labor contract was terminated. Secondly, Fang's resignation date was December 29, and December 30 and 31 were weekends, indicating that he had worked in the company for one year in 2017. Finally, in the absence of evidence to the contrary in the company, the second instance court of presumed that Fang had completed his annual work tasks and met the conditions for the issuance of year-end bonuses. Based on the above reasons, the second instance court finally found that the company's claim that Fang had resigned before the year-end bonus was issued lacked rationality, thus supporting Fang's claim for the year-end bonus in 2017. #02
Judicial status and legal analysis - Determination of the effectiveness of the rules for resignation bonus issuance
For the effectiveness of "employees are not entitled to bonuses before resignation bonuses" or "year-end bonuses are only for employees who are still working on the date of resignation", etc. (hereinafter referred to as "resignation bonuses are issued" and ) have always had two opposite views in practice, and each has judicial precedent to support it.
One view holds that workers enjoy the right to obtain labor remuneration, and year-end bonuses are also part of their labor remuneration. Whether it is agreed in the labor contract or stipulated in the rules and regulations, it constitutes the right of employers to exempt themselves from their own obligations and restrict workers from obtaining labor remuneration in accordance with the law. It violates the provisions of Article 26 of " Labor Contract Law" " or Article 50 of " Labor Law " , and therefore it should be an invalid clause. For example, in (2021) Guangdong 01 Minzhong No. 5631 case, the Guangzhou Intermediate People's Court held that if the company and its employees agreed that "if the annual target bonus is terminated due to any reason before issuance, our company will no longer pay you this bonus" is the employer's right to exempt itself from its statutory responsibilities and exclude workers, and should be invalid according to law. Similarly, in (2017) Jing02 Minzhong No. 484 case, the company claims that employees apply for resignation before issuing the year-end bonus. According to the provisions in the employee manual that "if the labor contract between the two parties is terminated or terminated before the performance bonus issuance or the employee himself submits a resignation application before the performance bonus issuance, the employee is not entitled to enjoy the above bonus", the company does not need to pay the year-end bonus. However, Beijing Second Intermediate People's Court believes that because workers enjoy the right to obtain labor remuneration, year-end bonuses are also the labor remuneration for their normal labor. The rules for issuing resignation bonuses in the employee manual exclude the right to obtain labor remuneration and should be invalid.
Another view holds that Article 47 of the Labor Law stipulates that "an employer independently determines the wage distribution method and wage level of the unit according to the law based on the production and operation characteristics and economic benefits of the unit." The issuance of year-end bonuses falls within the scope determined by the employer independently. Therefore, the right of employer to formulate and implement a reasonable bonus system based on employment management autonomy. As long as the rules and regulations of the employer have clear provisions on the rules for issuing resignation bonuses and such rules and regulations have undergone democratic and public announcement procedures in accordance with the law, they should be deemed to be valid. For example, in the case of (2020) Guangdong 01 Minzhong 2805, even if the company illegally terminated and the court finally supported the employee's year-end bonus lawsuit, the Guangzhou Intermediate People's Court still believes that the "Measures for the Distribution of Comprehensive Performance Awards in 2018" was formulated by the company itself and does not violate the mandatory provisions of laws and administrative regulations. The employees' claims that the provisions of the measures for early resignation and not paying year-end bonuses are invalid and the basis is insufficient. In addition, the first instance court in Guidance Case No. 183 held this view. The second-instance judgment of
Guidance Case No. 183 compromised and balanced the above two views. It did not directly deny the effectiveness of the rules for resignation bonus issuance itself, but emphasized that it would be comprehensively considered in individual cases, so that the rules still have room for application under reasonable circumstances, reflecting judicial modesty and respect for employers' business autonomy. However, at the same time, the guiding case also clarifies that in individual cases, the rationality of resignation bonus issuance rules should be reviewed in individual cases in individual cases, and the legitimate rights and interests of workers are safeguarded:
- In terms of reasons for resignation, whether the employee resigned voluntarily or resigned due to his own negligence;
- In terms of resignation time, whether the employee has completed one year of work when he left;
- In terms of work performance, does the company have no evidence to prove that the employee's industrial performance is poor.
According to Guidance Case No. 183 , when the above three review standards are met at the same time, the employer is likely to need to pay the employee the corresponding year-end bonus. However, this guidance case does not make a clear response to whether the employer's resignation bonus payment rules can be supported and applied when the above three review standards are only partially met (for example, if an employee has completed the full-year work tasks and performed well, but voluntarily resigned before the year-end bonus is issued or the labor relationship is terminated due to fault).We tend to believe that according to the spirit of the Guidance Case No. 183 and the existing judicial precedents, when workers voluntarily resign or leave their jobs due to their own fault, the rules for resigning will have certain room for application. For example, in (2019) Beijing 02 Minzhong No. 6043 case, the Second Intermediate People's Court of Beijing held that employees, while clearly aware of the adverse impact of resignation on the payment of year-end bonuses, still terminated their labor contract with the company for personal reasons, and did not meet the conditions for year-end bonuses. In the case of (2022) Jing03 Minzhong No. 5012, the company stipulated that "double salary at the end of the year must be an employee who is still working on the job on the date of payment." Beijing No. 3 Intermediate People's Court considered that the employee was terminated due to work dereliction of duty and serious violation of company rules and regulations, and finally rejected the employee's lawsuit for year-end bonus.
However, we have noticed that the previous " Shenzhen Employees Wage Payment Regulations " (Note: The new regulations have been revised to this) stipulates that "when the labor relationship is terminated or terminated, wages that have not expired for the payment period of employees' monthly awards, quarterly awards, year-end bonuses, etc. shall be converted according to the actual working hours of the employees." Therefore, in the past, even if an employee voluntarily resigned or resigned due to his own negligence, the court may have considered that the rules for resignation bonus payments are not applicable and employees have the right to enjoy the year-end bonus. For example, in the case of (2019) Guangdong 03 Minzhong 31313, when the employee was unilaterally legally terminated by the company for absenteeism, the Shenzhen Intermediate People's Court supported the employee's converted year-end bonus in accordance with the provisions of the "Shenzhen Employees' Wage Payment Regulations".
It is worth noting that in the guidance case No. 183, both the first instance and the second instance courts determined that the company unilaterally terminated the labor relationship with Fang as a legal termination. In illegal termination cases, even if the employee fails to complete one year's work when he leaves the job and fails to meet the annual performance standards, the court is likely to attribute this to the fault of the employer, that is, illegally interrupting the labor relationship with the employee in advance, which leads to the employee's inability to complete the annual work tasks or the performance cannot meet the standards, thereby supporting the employee's request for year-end bonuses. For example, in the case of (2019) Jing03 Minzhong No. 10491, the Beijing No. 3 Intermediate People's Court held that the employee's resignation was due to the illegal termination of the company and not for his own reasons. The company requires strict application of the company's assessment system and not to pay the year-end bonus, which is a disguised deprivation of employees' opportunity to obtain the year-end bonus. In the end, the court determined that the company should pay the corresponding year-end bonus in proportion according to the employee's working hours (7 months) for the year.
#03
Compliance suggestions
According to relevant laws and regulations and the guidance case No. 183, we believe that the rules for resignation bonus payment are still relatively favorable to enterprises, but enterprises need to adjust and improve internal rules and regulations and management practices based on the principles of fairness and reason and the latest judicial practices. Specifically:
First of all, although the rules for resignation bonus payments are considered to violate the principle of fairness and rationality, there is still room for application when an employee voluntarily resigns or his own negligence causes resignation, which can protect the legitimate rights and interests of the company to a certain extent. Therefore, we still recommend that enterprises set relevant clauses in internal rules and regulations such as employee manuals in accordance with the requirements of Guidance Case No. 183, or improve existing rules for issuing resignation bonuses in accordance with the requirements of Guidance Case No. 183. For example, whether they can get year-end bonuses will be distinguished and refined based on different reasons for leaving.
Secondly, enterprises should ensure that these rules and regulations have complied with the democratic procedures and public announcement procedures stipulated in Article 4 of the Labor Contract Law, and procedurally ensure the legality of these clauses.
Again, enterprises should return the determination of whether employees are entitled to bonuses to their judgment of substantive requirements. It is recommended that enterprises clearly set the requirements and standards for the issuance of performance year-end bonuses in relevant rules and regulations or agreements with employees, rather than just taking whether employees are on duty as the only criterion for whether they can obtain year-end bonuses.
Finally, in the process of employee resignation management, pay attention to collecting and preserving relevant evidence of whether the substantive requirements for the resignation of bonus payments (such as work performance standards, performance completion, etc.), especially for the situation where the company actively terminates or terminates it, and the evaluation of performance appraisal before resignation cannot be ignored. For employees who voluntarily resign, in order to reduce potential future bonus disputes, relevant links can also be set up in the resignation process and employees are required to confirm in writing the fact that they no longer enjoy the year-end bonus.
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