Secured Nearly 200,000 RMB of Severance Pay for a Foreigner In Labor Dispute
Our team recently represented a foreigner holding a Chinese “Five-Star Card” (Permanent Residence Permit) in a labor dispute with his employer over labor contract renewal, achieving a favorable resolution. Through precise legal positioning, a robust arbitration strategy, and multiple rounds of professional negotiations, we successfully secured a nearly 200,000 RMB settlement for our client in this labor dispute, effectively safeguarding the legitimate rights and interests of high-level foreign talent in China’s labor market.
1. Case Background: The Foreigner’s Renewal Dilemma
Our client, Mike (pseudonym), was embroiled in a labor dispute when his employer abruptly decided not to renew his second fixed-term labor contract upon expiration, leaving him facing involuntary job loss after several years of consecutive employment with the company.
As a foreign national holding a Chinese Permanent Residence Permit and enjoying its associated benefits, Mike was initially pessimistic about resolving the labor dispute and protecting his rights in the face of his employer’s unilateral non-renewal decision. Before seeking our team’s legal assistance, he had nearly resigned himself to the reality of involuntary termination stemming from the labor dispute.
2. Legal Positioning and Strategic Choice
Upon accepting this labor dispute case, we promptly assembled a specialized labor dispute team and conducted a comprehensive analysis from three key dimensions to address the core issues:
(1) Legal Status Determination in Labor Disputes
According to the “Measures on the Treatment Entitled to Foreigners with Permanent Residence Status in China,” foreign nationals holding a Chinese Permanent Residence Permit enjoy the same labor rights and assume the same obligations as Chinese citizens in labor dispute scenarios (except for specific excluded rights). This meant Mike was directly protected by China’s Labor Contract Law in this labor dispute, granting him equal treatment to Chinese workers. The critical labor dispute point was that Mike had consecutively signed two fixed-term labor contracts—satisfying the Labor Contract Law requirement for an open-ended labor contract.
(2) Arbitration Strategy Formulation for Labor Disputes
Based on Mike’s legal status, we confirmed he was entitled to identical labor protections as Chinese citizens in this labor dispute. The employer’s refusal to sign an open-ended contract (despite Mike’s clear renewal willingness) constituted suspected illegal termination of the labor relationship—an actionable claim in the labor dispute. We calculated Mike could legally seek compensation including illegal termination damages, contract completion bonuses, and unpaid annual leave wages, totaling a substantial sum for this labor dispute.
(3) Evidence System Construction for Labor Dispute Resolution
The team guided Mike to systematically collect three key evidence types critical to resolving the labor dispute:
- Labor relationship proof: Two complete labor contracts, work permit records, and salary payment records (foundational to establishing the labor dispute);
- Renewal intention proof: Email correspondence and renewal survey forms (demonstrating Mike’s clear willingness to renew—an essential factor in the labor dispute);
- Employer breach proof: Records of the company’s explicit refusal to renew (directly supporting the illegal termination claim in the labor dispute).
3. Professional Arbitration and Multi-round Negotiations
(1) Precise Labor Arbitration Application
On the basis of thorough preparation, we filed a labor arbitration application with the local Labor and Personnel Dispute Arbitration Commission, emphasizing three critical points: (1) the employer’s illegal refusal to sign an open-ended labor contract, a core violation in labor disputes; (2) the principle of equal rights for permanent resident foreigners and Chinese workers in labor disputes; (3) clear and reasonable compensation claims aligned with labor dispute regulations.
(2) Multi-round Professional Negotiations in Labor Dispute Resolution
Given the potentially lengthy timeline of labor dispute arbitration and litigation—even if successful, compensation could be significantly delayed—Mike expressed concern. Therefore, after filing the case, we did not merely wait for the arbitration hearing but proactively initiated multiple rounds of professional negotiations to resolve the labor dispute:
- First Round
Clarifying Legal Stance on Labor Dispute. We clearly communicated the special legal status of permanent resident foreigners in labor disputes to the employer’s representative lawyer. Simultaneously, we presented relevant legal bases and similar labor dispute cases, highlighting the severe legal risks of illegal termination.
- Second Round
Presenting Key Evidence for Labor Dispute. We selectively disclosed core evidence to the opposing party, demonstrating our evidential strengths and focusing on the completeness and credibility of the evidence chain in labor dispute cases.
- Third Round
Balancing Interests in Labor Dispute Settlement. We analyzed the pros and cons from various perspectives—including the company’s reputation risks and the impact on foreigner management in labor disputes—and proposed a reasonable and constructive settlement plan tailored to labor dispute resolution.
(3) Breakthrough in Mediation
Facing a strong employer, we seized the optimal timing, maintaining legal pressure while demonstrating sincerity towards mediation. This ultimately led both parties to reach a settlement agreement of nearly 200,000 RMB, far exceeding the client’s initial expectations .
4. Case Outcomes and Value
The successful resolution of this labor dispute case brought the following benefits to our client:
- Secured nearly 200,000 RMB in compensation through the labor dispute resolution, effectively alleviating financial pressure during the employment transition period.
- Protected his dignity and rights via legal channels in the labor dispute, thereby enhancing his confidence in China’s legal environment.
- Achieved rapid labor dispute resolution through settlement, avoiding protracted arbitration and litigation procedures.
For foreign nationals facing labor disputes in China, a professional legal team specializing in labor disputes must not only be well-versed in general labor regulations but also proficient in specific provisions governing foreign-related labor relationships to deliver precise and effective legal services for labor dispute resolution.
