The Standing Committee of the National People’s Congress amended the Work Safety Law On 10 June 2021, introducing several new rules and increasing sanctions for non-compliance. The amended law will take effect on 1 September 2021. Some of the main changes and new employer obligations are:
Emphasise care for employees. The amendments require companies to pay attention to the physical and psychological condition, and behaviour habits of their employees, and to strengthen psychological counselling and spiritual consolation for their employees.
Obtain work safety liability insurance. The amended law requires companies belonging to high-risk industries (e.g., coal mining) to purchase work safety liability insurance. Other companies are encouraged, but not obliged, to do so.
Establish concept of public interest lawsuits. If the illegal act of a company causes a major accident or hidden danger, which infringes national interests or social public interest, the people’s procuratorate may file a public interest lawsuit against such company.
Increase sanctions for non-compliance. The amended law increases fines for most non-compliant activities. For extremely serious violations, fines may be up to RMB100 million (USD15.4 million). Other than fines, the company may also face frequent labour inspections, increased insurance contributions, suspensions of project approvals, etc. There is also a new penalty scheme. Companies that refuse to rectify non-compliance after being fined may be additionally fined (the additional fine will accumulate on a daily basis based on the original fine amount).
Business Law Digest is compiled with the assistance of Baker McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker McKenzie by e-mailing Howard Wu (Shanghai) at howard.wu@bakermckenzie.com
