Regulation of Guangdong Province on the Payment of Wages

(Adopted at the 16th meeting of the Standing Committee of the 10th People’s Congress of Guangdong Province on January 19, 2005)

Chapter I General Provisions

Article 1 For the purpose of regulating the payment of wages, safeguarding the rights of employees to get remunerations for their labor, establishing a harmonious labor relationship and promoting social stability and economic development, this Regulation is formulated in accordance with the Labor Law of the People’s Republic of China and the relevant laws and administrative regulations, and in combination with the actual situation of this Province.

Article 2 This Regulation shall apply to enterprises, private non-enterprise entities and individual economic organizations (hereinafter referred to jointly as employing entities) within the jurisdiction of this Province and the employees who have established labor relationship therewith.
The state organs, public institutions and social organizations within the jurisdiction of this Province and the employees who have established labor relationship therewith shall be governed by this Regulation through analogy.

Article 3 The Provincial People’s Government shall formulate a minimum wage standard pursuant to the relevant provisions, and the people’s governments at or above the level of districted city shall determine the minimum wage levels of their respective cities within the minimum wage levels as promulgated by the Provincial People’s Government.
The people’s governments at or above the county level shall regularly announce the guiding wage and guiding wage level of the labor market, and provide guidance and services to the employing entities and employees.

Article 4 The wages shall be paid on schedule, in full amount and with priority.
Where an employee provides normal labor within the statutory working hours or the working hours as stipulated in the labor contract, the employing entity shall determine his wage standard not lower than the local minimum wage level.

Article 5 The people’s governments at all levels shall establish and improve their respective early-warning mechanisms of wage payment, credit supervisory mechanisms and emergency handling mechanisms.

Article 6 The administrative departments of labor and social security of the people’s governments at all levels (hereinafter referred to as the labor and security department) shall be responsible for the guidance, supervision and inspection of wage payment by employing entities within their respective jurisdictions.
The departments of industry and commerce, construction, customs, taxation, and the banks shall help the labor and security department in the respect of supervision over the payment of wages within their respective functions.
Labor unions and women’s federations shall lawfully maintain the rights of employees for remuneration for their labor.
Any entity or individual shall have the right to report any illegal act related to the payment of wages.

Chapter II Payment of Wages

Article 7 An employing entity shall establish its system on the rules of wages according to law, and make it known to all the employees thereof in written form.
The rules for payment of wages shall cover the following matters:
(1) Ways for distribution of wages, items, standards and methods for the determination and adjustment thereof;
(2) Period and date for the payment of wages;
(3) Overtime wages, wages for extra working hours, wages for special circumstances, and the payment methods thereof;
(4) Wages to be withheld and deducted, and the withholding and deduction matters; and
(5) Other relevant matters.
An employee is entitled to inquire the employing entity about the contents of the rules on the payment of wages.

Article 8 An employing entity shall stipulate the wages for normal working hours paid to employees in the labor contract, and the stipulated wages may not be lower than the minimum wage level of that year as promulgated by the local government.
Where there is no stipulation or definite stipulation in this respect, the average monthly wages of the employees as proclaimed by the county people’s government at the locality where the employing entity is domiciled shall be the wages for normal working hours; where the wages actually paid are higher than the average monthly wages of employees as proclaimed by the local government, the wages actually paid shall be regarded as the wages for normal working hours as agreed on by the employees.

Article 9 An employing entity may conduct collective consultation with the labor union or employee representatives thereof in regard to the payment of wages, and shall conclude a collective agreement thereon.

Article 10 An employing entity shall pay wages in currency, at the determined cycles for paying wages and in full amount. No delinquency or skimp is allowed.
Where the wages are paid at the cycle of month, week, day or hour, the period for paying wages may be determined according to the month, week, date or hour.
Where the system of paying wages by piecework is implemented or the wages are paid for a certain task to be accomplished, the cycle for paying wages may be stipulated according to the number of piecework done or the accomplished tasks, while if the cycle for paying wages in excess of one month, the employing entity shall pay wages on a monthly basis pursuant to the stipulations.
Where an annual payment system is implemented or the wages are paid on the basis of the examination period, the employing entity shall pay wages per month according to the stipulations, and shall settle and pay them off at the end of the year or at the expiry of the examination cycle.

Article 11 An employing entity shall pay wages directly to the employee himself. If an employee fails to draw wages due to any reason, he may entrust any other to draw it, and a power of attorney shall be provided.
If an employing entity entrusts a bank to pay wages, it shall deposit the full wages into the accounts of employees themselves at the stipulated date for the payment of wages.

Article 12 An employing entity shall pay wages to its employees at the stipulated date. In the case of legal holidays or rest days, the employing entity shall pay their wages at the nearest working day in advance.

Article 13 When an employing entity terminates or dissolves the labor relationship with an employee according to law, it shall pay off the wages of the employee once and for all on the day when the labor relationship is terminated or dissolved.

Article 14 An employing entity may withhold the following funds from the wages of employees pursuant to the relevant provisions:
(1) Individual income taxes that should be paid by employees;
(2) Various social insurance fees and housing reserves that should be paid by employees themselves;
(3) Alimony, estovers and child support payment that should be withheld as required by the rulings and verdicts of the people’s court; or
(4) Other fees that may be deducted from the wages of employees as prescribed by laws and regulations or as agreed on by both parties.

Article 15 In case an employee shall compensate for the direct economic losses he has incurred to the employing entity due to his fault, the employing entity may deduct the compensations from his wages, but shall give a written notice on the reasons for deduction and the amount to be deducted in advance; otherwise, it may not deduct the wages. And the monthly wages remained after the deduction of compensations may not be lower than the local minimum wage standard.

Article 16 An employing entity shall compile ledgers for the payment of wages on the basis of the cycles of payment of wages, and keep them for at least two years.
The ledgers for the payment of wages shall mainly specify the date and cycle of payment, the names of employees, working hours, the items and amount of wages payable, the items and amount withheld and deducted, the amount of wages actually paid, as well as the vouchers issued by the bank on the entrusted payment of wages or the signatures of employees, etc.

Article 17 When an employing entity pays wages, it shall provide lists of wages to the employees themselves.
When an employing entity extends the working hours or arranges employees to work on rest days or legal holidays, it shall put corresponding wages and remunerations on the list of wages If the employing entity fails to do so and can not prove the payment, it shall be regarded as a failure to pay corresponding wages and remunerations.
The items and amount on the list of wages shall be identical with the ledgers for the payment of wages.
An employee has the right to consult and verify his list for payment of wages.

Article 18 Daily wages shall be determined pursuant to the monthly wages deducted by the average monthly working days as prescribed by the State, while hourly wages shall be determined pursuant to the daily wages deducted by the average daily working hours, which may not be more than 8 hours.

Article 19 Where an employee enjoys such vacations as legal holidays, annual leave, leave for going home to visit their families, wedding leave, leave for arranging funeral, maternity leave, nursing leave, and vacation for childbirth, etc., this shall be regarded as normal labor offered by the employee and the employing entity shall pay wages to him.

Article 20 When an employing entity arranges employees to work overtime or extends their working hours, it shall pay the overtime wages and wages for the extended working hours to the employees pursuant to the following standards:
(1) Overtime wages and remunerations shall be paid at the rate of 150% of the daily or hourly wages of the employees themselves for the extended working hours in a working day;
(2) Overtime wages and remunerations shall be paid at the rate of 200% of the daily or hourly wages of the employees themselves in case the employees work at the rest day and the employing entity fails to arrange for their rest at a later time; or
(3) Overtime wages and remunerations shall be paid at the rate of 300% of the daily or hourly wages of the employees themselves in case the employees work at legal holidays.

Article 21 Where the system of paying wages by piecework is implemented, an employing entity shall properly determine the ration of piecework and the unit price of piecework, and make them public.
The specific ration of piecework shall be one that can be completed within the legal working hours by 70% or more employees at the same post of the entity.
In case an employing entity arranges employees to work beyond the normal working hours after they complete the rationed labor, it shall pay overtime wages and wages for the extended working hours pursuant to Article 20 of this Regulation.

Article 22 Where the system of comprehensive calculation of working hours is implemented upon approval of the labor and security department, the part of the actual working hours of an employee which exceeds the accumulative statutory working hours within the period of comprehensive calculation period shall be considered as the extended working hours, and the employing entity shall pay wages pursuant to the prescriptions in Item (1) of Article 20 of this Regulation. Where an employing entity arranges employees to work in legal holidays, the employing entity shall pay wages pursuant to the prescriptions in Item (3) of Article 20 of this Regulation.

Article 23 In case the system of non-regular working hours is implemented upon approval of the labor and security department, the Article 20 of this Regulation will not be applicable.

Article 24 In case an employee stops his work for treatment due to his illness or non-work-related injury, an employing entity shall pay wages for sick leave in accordance with the stipulations of the labor contract or the collective contract or the prescriptions of the State during the medical period as prescribed by the State.
And the sick leave wages paid by the employing entity shall not be less than 80% of the local minimum wage level.
Where there are different prescriptions in any law or regulation, such prescriptions shall prevail.

Article 25 An employing entity may not pay wages to an employee during his private affairs leave.

Article 26 When an employee participates in any of the following social activities in accordance with law during the normal working hours, the employing entity shall pay wages to him as he has offered normal labor:
(1) Lawful exercise of the right to vote or the right to be elected;
(2) Lawful exercise of functions as a deputy to the people’s congress or member of the people’s political consultative conference;
(3) Participation as a deputy in a meeting held by such organizations as the government, party, trade union, communist youth league or women’s federation at the level of township (town) or higher;
(4) Participation in court proceedings as a people’s assessor;
(5) Participation in the activities of a trade union as a non-off-the-job member of a grassroots committee of the trade union;
(6) Participation in the negotiation for the collective contract as a representative of employees; or
(7) Any other circumstance as prescribed by any law or regulation.

Article 27 Where an employee is sentenced by the people’s court, and put under surveillance or taken into custody but placed on probation, or sentenced to a fixed term of imprisonment but on probation, if the employee continues to normally work for the former entity during the periods of parole, surveillance outside prison, or waiting for trial on bail, it shall pay wages to him.

Article 28 In case an employee is suspected of committing a crime and thus is put on judicial compulsory measures or taken into administrative custody, and fails to work for the entity, the employing entity may not pay wages to him.

Article 29 In case the decision of an employing entity on discharge of labor relationship shall be rescinded upon a ruling or is adjudicated as void, the employing entity shall pay the wages for the period of illegal discharge of labor relationship to the employee, and the wage standard shall be the wages for normal average working hours of the employee himself within the previous 12 months; while if the employing entity has obtained the unemployment insurance, he shall return it to the institution responsible for the social insurance in full amount.
Where there is any dispute on the period as prescribed by the preceding paragraph, it can be adjudicated by the labor dispute arbitration committee or the people’s court.

Article 30 If a partnership defaults in payment of wages of its employees, the wages shall be first paid by all the properties of the partnership; if the properties of the partnership are not sufficient for the wages, each partner shall assume unlimited and joint liability for payment.

Article 31 In case the operator of an employing entity that has leased the worksite or plant and defaults in the payment of wages and escapes, the local government and the relevant department shall adopt effective measures and timely organize the relevant entities and personnel for handling the affairs, such as the advanced payment of temporary living cost and the recovery of wages.

Article 32 In case a contractor who does not have the qualification of an employing entity as prescribed by Article 2 of this Regulation defaults or skimps the wages of employees, the employing entity that provides the project shall pay the wages in advance, and then recover its losses against the contractor.

Article 33 Where an entity undertaking the project (owner) fails to allocate funds for or settle for the prices of the project pursuant to the stipulations in the contract, and causes the construction entity’s default in the payment of wages of employees, the labor and security department may order it to pay the wages of employees in advance within the amount of unsettled prices for the project.
In case the subcontractor of an engineering project defaults or deducts the wages of employees, the party that provided the engineering project shall pay the wages of employees within the amount of unsettled prices for the project. The advanced payment shall be used to offset the prices of the project.
In case the party that provides the engineering project illegally contracts or subcontracts the project, or illegally allows any other to undertake the project in the name of its own, and causes the default in payment of wages, the wages of employees shall be paid in advance by the party that provides the engineering project.

Article 34 In case the wages of employees are defaulted prior to the merger or division of an employing entity, the defaulted wages shall be paid at the time of the merger or division; if they can not be paid, the merged or divided employing entity shall pay the defaulted wages.

Article 35 In case the shutdown or shutout of an employing entity is caused by the fault of the employees themselves, the employing entity shall pay wages to the employees as they have offered normal labor if it is within one payment cycle (the maximum period shall be 30 days). In case it exceeds one payment cycle, wages may be paid according to the work offered by the employees on the basis of the standard newly stipulated by both parties. If the employing entity does not arrange for the employees to work, it shall pay living expenses to the employees at the rate of 80% of the local minimum wage standard. The living expenses shall be paid until the enterprise resumes its operation or production, or the labor relationship is dissolved.

Article 36 In case an employing entity goes bankrupt, is terminated or dissolved, the properties thereof after liquidation shall be primarily used for paying wages and social insurance fees it owed to the employees.

Chapter III Supervision and Inspection

Article 37 The people?government at or above the county level shall establish an early-warning system on the payment of wages in accordance with the actual situation of its own jurisdiction on the payment of wages.
The labor and security department may exercise focused surveillance over those employing entities that have defaulted in the payment of wages of employees for two or more months or for accumulatively three or more months, or may make it public if the circumstance is serious.
An employing entity listed into the focused surveillance over the payment of wages has paid the defaulted wages of employees, and no new default has occurred within six months, the labor and security department shall remove the focused surveillance, and announce the removal thereof within the originally announced scope.

Article 38 The people?government at or above the county level shall establish an early-warning system on the payment of wages. In case any collective event is caused due to the default or skimp of wages of employees, the labor and security department shall, according to the emergency handling mechanism, handle it together with the relevant department, which shall give their cooperation.

Article 39 The labor and security department shall establish and improve the supervision and inspection system of employing entities on the payment of wages, regulate the supervision and inspection procedures, and exercise surveillance over the payment of wages by employing entities, and handle the illegal acts, if any.
When the labor and security department inspects the payment of wages by employing entities, the employing entities shall faithfully report their respective situations, provide the relevant materials and certificates, and may not resort to fraud, obstruction or refusal.

Article 40 The labor and security department shall establish and improve the system for reporting and complaining illegal acts related to the payment of wages, set up mail boxes of tip-off and complaint, announce the phone numbers for tip-off and complaint, provide convenience for employees to tip off or make complaints, and shall keep it secrets for the informer.
After the labor and security department receives any report or complaint, it shall decide whether to put it on file and inform the result to the informer or complaining person within seven working days; and if the investigation for any illegal act is necessary after the case is put on file, it shall be concluded within 60 days from the day when the case is put on file. Where the circumstance is complex and the time for handling of the case needs to be extended, it shall be subject to the approval of the labor and security department, but the extended time may not exceed 30 days.

Article 41 The labor and security department shall establish and improve the system of labor legality and credit archives of employing entities including the payment of wages, promote the appraisal system on the labor legality and credit, or may make public those employing entities that seriously default or skimp the wages of employees at the media, job centers or places of employing entities, and report the relevant conditions to the relevant departments and entities, such as the department for industry and commerce and the bank.

Article 42 The people?government at or above the county level shall strengthen its supervision and inspection of the law enforcement of the labor and security departments on the payment of wages. A higher labor and security department shall strengthen its supervision and inspection of law enforcement of its subordinate labor and security departments, and shall order them to make corrections within the time limit if it finds that any subordinate labor and security department does not make any act or makes an illegal or improper disposal decision on the illegal act of an employing entity.

Article 43 If an employing entity is under any of the following circumstances, the employee has the right to report and complain it to the labor and security department:
(1) Default or deduction of wages of employees;
(2) Wages paid to employees is lower than the local minimum wage level;
(3) Refusal to pay or failure to pay overtime wages to employees for their overtime work or the their extension of working hours according to law;
(4) Any other act in violation of the lawful rights and interests of employees for wages and remunerations.

Article 44 In the case of any dispute on the payment of wages, the employing entity shall assume the burden of proof. If the employing entity refuses to provide or fails to provide within the time limit the relevant vouchers on the payment of wages and other evidence and materials, the labor and security department, the labor dispute arbitration committee or the people’s court may make a ruling based on the amount of wages and other evidence as provided by the employee.
If both the employing entity and the employee fail to produce evidence on the amount of wages, the labor dispute arbitration committee or the people’s court may calculate and decide it by referring to the average wages of the same post in the same entity or the average wages of local on-the-job employees and pursuant to the principle of being favorable to the employee.

Article 45 A trade union may supervise the employing entity in respect of its observance of the relevant laws and regulations on the payment of wages, and shall have the right to ask the employing entity to make corrections for any illegal act or circulate a notice to the labor and security department. In case the employing entity refuses to make corrections or the operator escapes, the trade union can represent the employees to request the local labor and security department to handle it in accordance with law, and if the employee files a labor arbitration or lawsuit, the trade union shall offer support and assistance.

Article 46 In case an employing entity defaults or skimps any wages, the employees may request the trade union to help resolve it, and the trade union shall represent the employees and consult with the employing entity, and help the employing entity to maintain the normal production and working order.

Chapter IV Legal Liabilities

Article 47 In case an employing entity consecutively defaults or deduct the wages of employees for more than two months or is under exceptionally serious circumstances, the labor and security department shall order it to make corrections and make an administrative sanction decision. In case the employing entity refuses to carry out the administrative sanction decision within the prescribed time limit, the labor and security department may apply to the people’s court for enforcement.

Article 48 In case an employing entity is under any of the following circumstances, the labor and security department at or above the county level shall order it to make corrections; if it fails to make corrections within the prescribed time limit, it may be imposed with a fine of 5,000 yuan up to 10,000 yuan, and its legal representative may be fined 1,000 yuan up to 5,000 yuan:
(1) Failure to formulate rules on the payment of wages and announce it to all the employees thereof;
(2) Failure to pay wages to employees in the form of currency;
(3) Failure to settle the wages and pay it to the employee in a lump sum on the day when the labor relationship is terminated or discharged;
(4) Failure to faithfully formulate ledgers on the payment of wages; or
(5) Failure to provide a list of wages to the employees themselves.

Article 49 In case an employing entity is under any of the following circumstances, the labor and security department shall separately order it to pay the wages and remunerations to the employee within the time limit, pay the gap between the local minimum wage level and the wages of the employee, or pay the wages for overtime work or extended working hours. If the employing entity fails to pay within the time limit, it may be ordered to pay extra compensations to the employee as calculated at the rate of 50% up to 100% of the amount payable:
(1) Default or skimp of the wages of employees;
(2) Wages paid to employees is lower than the local minimum wage level;
(3) Refusal to pay or failure to pay overtime wages to employees for their overtime work or extended working hours according to law.

Article 50 In case an employing entity is under any of the following circumstances, the labor and security department shall impose it a fine of 10,000 yuan up to 20,000 yuan in light of the following circumstances:
(1) Refusing or impeding any labor and security administrative law enforcer in their lawful implementation of public affairs;
(2) Failing to submit written materials as required by the labor and security department, disguising the truth of facts, issuing false evidence, or concealing or destroying evidence; or
(3) Refusing to make corrections as ordered by the labor and security department, or refusing to fulfill an administrative sanction decision as made by the labor and security department.

Article 51 In case an employing entity defaults in the payment of wages by abscond, which makes the employees hard to recover their wages and further causes any incident that seriously affect the public order, the legal representative or operator of the said entity shall be dealt with by the public security organ; if any crime is constituted, it shall be subject to criminal liabilities.
Where an incident that seriously affects the public order is caused due to the default or skimp of wages by the employing entity, the legal representative or main operator of the said entity shall come to the scene within 24 hours and help the labor and security department to handle the incident; if he fails to do so, the labor and security department shall impose a fine of 10,000 yuan up to 50,000 yuan on him.

Article 52 Where the labor and security department or any of its functionaries violates this Regulation and commits any of the following acts, its higher administrative department or supervision department may order it/him to make corrections; where the circumstances are serious, the principal and other person that is held to be directly responsible shall be imposed with administrative sanctions:
(1) Failure to establish the system of reporting illegal acts related to the payment of wages of employing entities;
(2) Failure to keep secret for informers;
(3) Failure to promptly deal with the reports of employees or the handling suggestions as put forward by the trade union pursuant to Article 45 of this Regulation; or
(4) Failure to start up the emergency handling mechanism for a collective incident.

Article 53 Where the labor and security department or any of its functionaries commits any of the following acts, the main principal and persons that is held to be directly responsible shall be imposed with administrative sanctions; and be subject to criminal liabilities if any crime is constituted:
(1) Neglecting its/his duties, or abusing its/his functions;
(2) Seeking for personnel interests by making use of its/his authorities; or
(3) Divulging any business secret of an employing entity.

Chapter V Supplementary Provisions

Article 54 The following terms in this Regulation shall mean as follows when they are used therein:
(1) The "wages" refer to the whole remuneration in cash for labor provided by the employing entity to the employee himself pursuant to the quantity and quality of labor offered by the employee, which, as a general rule, includes: wages in any form (hourly wages, wages by pieces, wages for posts, wages for duties, wages for skills, etc.), premiums, allowances, and subsidies, overtime wages and wages and remunerations paid for special circumstances, etc.; but does not include: various social insurance fees and housing reserves assumed by the employing entity as prescribed by relevant provisions, labor protection fees as prescribed by the labor and security department and the supervisory and administrative department of production safety, and the welfare fees and incomes from non-remuneration for labor as prescribed by the State, such as the one-child subsidies, family planning awards, funeral fees, and consolation money, etc.
(2) The term "wages for normal working hours" means the remunerations for labor that shall be paid by the employing entity to the employees for their normal labor as provided within the legal working hours, which does not include the following items: a. wages for extended working hours; b. allowance for working in such special working environments or conditions as middle shift, night shift, high temperature, low temperature, underground, poisonous and harmful environments, etc.; c. welfare and benefits of employees as prescribed by laws, regulations and the State.
(3) The "minimum wage" refers to the minimum remuneration for labor that shall be paid by the employing entity to the employees for their normal labor as provided pursuant to the preceding provision within the legal working hours.
(4) The "default in payment of wages" refers to an act by which an employing entity fails to pay within the time limit or fails to pay the full wages of employees without any legal cause.
(5) The "skimp of wages" refers to an act by which an employing entity skimps or reduces the wages of employees without any legal cause.
(6) A "private non-enterprise entity" is a social organization run by an enterprise, public institution, social group, any other social strength or an individual citizen by making use of non-state assets, and engaged in non-profitable social services.

Article 55 Any dispute between an employee with its employing entity due to the amount of wages payable shall be dealt with pursuant to the provisions on the handling of labor disputes.

Article 56 This Regulation shall come into force as of May 1, 2005.