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china economic weekly reporters guo jiyao and shi qingchuan | beijing and chongqing reports

small, medium and micro enterprises are an important part of china's economy and an important support for my country's economic and employment resilience. they are related to the overall economic and social development. small, medium and micro enterprises are connected to thousands of industries and thousands of households, and are a "reservoir" for absorbing and regulating employment. the results of the fourth national economic census show that small, medium and micro enterprise legal entities account for 99.8% of all corporate legal entities of all scales, and absorb 79.4% of all employees in all enterprises.

this is an observation from an abstract macro perspective. from a micro perspective, although enterprises and employees prosper and suffer together, in reality there are often many dislocations and contradictions. recently, two hot topics on social media about employment in small and medium-sized enterprises are a true reflection of these contradictions.

on the one hand, under the dual pressure of recovery and transformation, small and medium-sized enterprises often face the problem of cost control. many small and medium-sized enterprise bosses lament that "all the money is used to pay wages." in order to reduce the pressure of labor costs, some companies have to adopt strategies such as cautious recruitment, personnel control or flexible employment in order to survive.

on the other hand, the new workplace ecology is quietly changing the employment concepts of "workers", especially the younger generation. in addition to pursuing material rewards, they also expect a sense of achievement and respect at work. however, the cruel reality has left many "workers" with a huge gap, and self-mockery and complaints in the workplace often become hot topics on social media.

the public sentiment and wishes reflected behind this show that: on the one hand, companies hope that employees will understand the company and work together to overcome difficulties to help the company survive the downturn caused by market changes and the pain period of transformation and upgrading; on the other hand, employees hope that companies will show more care and be able to provide sufficient material and spiritual rewards.

what are the reasons behind the different demands of enterprises and employees? what is the actual employment situation of small and medium-sized enterprises? are enterprises and employees always opposites? how can enterprises and employees coexist, prosper and develop together? how can we promote the joint efforts of multiple parties to jointly create harmonious labor relations in the new era?

to this end, china economic weekly reporters conducted research and interviews with a number of small and medium-sized enterprises in various regions and industries to listen to their confusion and demands regarding employment. at the same time, a "questionnaire survey on the current employment status of small and medium-sized enterprises" was launched, which covered multiple aspects such as enterprise size, labor cost proportion, labor cost changes, recruitment plans, outsourcing and flexible employment, challenges faced, and issues related to employment laws.

as of press time, a total of 72 enterprise questionnaires have been collected from beijing, shanghai, guangdong, jiangsu, zhejiang, sichuan, chongqing and other regions. in terms of business scope, the 72 small and medium-sized enterprises participating in the survey are concentrated in the service industry, science and technology/information technology and manufacturing, accounting for 33.33%, 19.44% and 12.5% ​​respectively; in terms of enterprise scale, 38.89% of enterprises have 10 to 50 employees, 33.33% have less than 10 employees, and 50 to 100 and more than 100 enterprises account for 15.28% and 12.5% ​​respectively.

china economic weekly found that high labor costs have become one of the main problems faced by small and medium-sized enterprises. specifically, wage expenditure accounts for a high proportion of total company expenses, and the labor costs of most companies have been on the rise in recent years. in order to cope with the pressure of rising labor costs year by year, many companies have to take measures such as salary cuts and layoffs, but these measures often have an adverse impact on the long-term development of the company.

in terms of recruitment and employment, small and medium-sized enterprises are also more cautious. many companies choose to recruit new employees when they leave. in addition, although many business owners said that considering the long-term development of the team, the company prefers to recruit long-term formal employees, in order to control costs, they still choose to adopt outsourcing and flexible employment.

it is worth noting that the increased employment compliance risks also trouble many small and medium-sized business owners. due to the lack of legal knowledge of managers and imperfect recruitment processes, some companies are prone to legal disputes. at the same time, the high turnover of employees also increases the recruitment and training costs of enterprises and reduces the operating efficiency of enterprises. faced with this situation, many small and medium-sized enterprises have begun to actively improve their corporate management and employment processes to avoid risks and achieve healthy development.

in addition, around the issues reflected in the questionnaire, china economic weekly reporters further interviewed relevant experts to discuss how to build harmonious labor relations in the new era.

high and increasing labor costs are a common problem

the results of a questionnaire survey initiated by china economic weekly showed that high labor costs have become the most common challenge faced by small and medium-sized enterprises in employment, accounting for 59.72%.

at the same time, the labor costs of most companies have increased compared with 2020. the labor costs of 37.5% of companies have increased significantly, 33.33% of companies have increased slightly, 20.83% of companies have remained basically unchanged, and only 8.33% of companies have decreased their labor costs.

in terms of the proportion of wage expenditure, 31.94% of companies’ wage expenditure accounts for 15% to 30% of the company’s total expenditure.

in addition, from the perspective of employee categories, 34.72% of the sample companies believe that front-line employees have the highest labor costs, 30.56% of the companies believe that technical personnel have the highest costs, and 29.17% of the companies have the highest management labor costs.

faced with rising labor costs, companies are also looking for solutions. some companies use flexible employment to control labor costs; others continue to train employees to improve work efficiency from a "qualitative" perspective...

the difference between the "feeling" of the enterprise and the employees is huge: the enterprise paid 22,000 yuan, and the employees received 10,000 yuan

in recent years, we often see on social media that “workers” are under the dual pressure of life and work, lamenting that they have too little money and too much work. but at the same time, many small and medium-sized enterprises are complaining that labor costs are too high, and “all the money is used to pay wages.” what is the reason that makes both sides complain?

"in fact, it is because many employees, especially fresh graduates, do not understand that their actual income and the company's labor costs are two completely different things." a small business manager who participated in the survey told a reporter from china economic weekly.

many of the companies interviewed said that the hidden costs of the companies are huge, and the actual human resource expenditures are far higher than the wages received by employees.

a financial staff member of a small business in beijing who participated in the survey did some calculations for the reporter of china economic weekly. taking their company's pre-tax salary of 15,000 yuan as an example, from the perspective of employees, after deducting five insurances and one housing fund, they get about 10,000 yuan per month. however, from the perspective of the enterprise, based on the social security payment rate of 26.6%, the enterprise has to pay about 3,990 yuan for employees every month for social security alone; if the provident fund is calculated at 12%, the enterprise will have to pay 1,800 yuan for the provident fund. after calculating these explicit costs, the cost paid by the enterprise for the monthly salary of employees is 20,790 yuan.

"if we add in meal allowances and holiday welfare subsidies, the cost per person per month would be nearly 22,000 yuan," said the financial staff member.

behind the 10,000 yuan that the employees receive is a cost of 22,000 yuan for the company. such a gap will inevitably lead to misunderstandings between the company and the employees, and both parties feel aggrieved.

when talking about explicit costs with the interviewed companies, social security expenditure becomes a high-frequency word.

"many people say there is tax pressure. in comparison, i think the social security cost is higher." li yan, general manager of chongqing heshengxing automobile service co., ltd., told the china economic weekly reporter that the factory currently has nearly 30 workers, and the monthly social security expenditure exceeds 50,000 yuan. "this is still paid according to a relatively low standard, and housing provident fund is not calculated. this part cannot be avoided."

in this regard, li yan also expressed his own thoughts. he hopes that the government can strengthen support for small and medium-sized enterprises by reducing or exempting social insurance. "for example, if an enterprise with less than 50 employees can grow to more than 50 employees or take its business to a higher level within a few years, it can reduce or exempt part of its social insurance fees. this can encourage enterprises to grow bigger. although the idea is very rough, i hope the relevant departments can consider this direction." li yan said.

in addition to explicit costs such as social security and housing provident fund, many companies said that there are also a large part of hidden costs. "for example, financial costs. our payment cycle is generally 40 to 50 days, but if we need to pay employees' salaries within 30 days, the company has to take out a loan, which invisibly increases the cost of employing people," said li yan.

this situation is particularly prominent in the manufacturing and construction industries. an industrial product trading company owner who participated in the survey revealed to the reporter of china economic weekly that the company's expenses are, from high to low, employee wages, taxes, rent and management expenses. the main reason for the high employee wage expenditure is that the payment cycle is too long. faced with the rising labor costs, he said that he has no ability to change it for the time being, and the company's priority is to try to survive.

among the hidden costs, employee training is another one. "most young people now prefer to work for large companies. there are a number of relatively unpopular majors in the market, and we pick up graduates from these majors. but these young people are not from professional schools after all, and they need company training, which pushes up labor costs." li yan said that after these people's work abilities gradually mature, they are also likely to leave, resulting in staff loss and the inability to pass on craftsmanship.

"recruiting employees is more cautious than finding a partner."control costs by using flexible employment, reducing staff and increasing efficiency

in order to control labor costs, many small and medium-sized enterprises choose flexible employment forms such as outsourcing and labor dispatch. according to the results of this questionnaire, among the small and medium-sized enterprises participating in the survey, 16.67% of them use outsourcing or flexible employment to reduce labor costs for a long time, 41.67% of them use it occasionally, 30.56% have never used it, and 11.11% of them are planning to use it.

"the cost of hiring long-term staff is too high. moreover, many businesses in the construction industry are project-based, and some positions are more suitable for flexible employment. both parties are more free, and employees can take on several jobs at the same time." zhang xiaolong told the reporter of "china economic weekly".

he runs a construction engineering company in beijing, with more than 150 regular employees and hundreds of temporary workers. "we determine the employment form based on job requirements. 60% are flexible employees, mainly working on projects; 40% are long-term employees, mainly in management positions," said zhang xiaolong.

during the interview, the reporter found that flexible employment is common in the construction and manufacturing industries, which are mainly based on the project system. specifically, core management positions are often long-term contracts, while project work is mostly flexible employment.

yu fei, former deputy director of the institute of chinese private enterprises at peking university, said in an interview with a reporter from china economic weekly that although the current flexible employment form saves costs, it is risky from the perspective of corporate management. "for the boss, employees are not under his jurisdiction and can come and go freely, which is risky and can easily cause a gap in the management level and affect management efficiency. in addition, in terms of emotions, employees may feel that they are not the boss's own people, and the boss also feels that he is not the employee's real boss."

fan zhaofeng, deputy director of the labor arbitration committee of the chongqing jiangbei district lawyers association, analyzed the case from the perspective of workers when he was interviewed by a reporter from china economic weekly. he said that for workers, when a labor dispute occurs, they can only sue the labor service company, but the payment ability of many labor service companies is questionable, and there are great obstacles to suing the actual work unit, which leads to problems such as difficulty in proving the length of service of employees and inability to enforce disputes.

it is worth noting that in addition to flexible employment, some small and medium-sized enterprises have also chosen to reduce wages, layoffs and other cost-cutting and efficiency-enhancing methods to control the rising labor costs. among the 72 companies surveyed by china economic weekly, 34.72% of the companies have reduced wages and laid off employees in the past year, and 15.28% of the companies are currently planning to lay off employees and reduce wages.

in addition, among the companies participating in this survey, few have clear recruitment plans. most companies either only fill in employees when they leave or have no recruitment plans. specifically, 20.83% of companies have clear recruitment plans, 37.5% of companies only fill in employees when they leave, and 41.67% of companies have no recruitment plans.

"i am more cautious in recruiting employees now than in finding a partner." a person in charge of an education and training institution participating in the survey told the reporter of china economic weekly half-jokingly that after laying off some employees in 2022, she never recruited again. "because it is too easy to recruit 'unsuitable people' now, which means greater losses and risks," she said.

but in yu fei's opinion, layoffs do not necessarily effectively control labor costs. he said that companies usually lay off many ordinary employees whose salaries are not high to begin with. those employees who create the main benefits are more likely to be the core personnel of the company, and their salaries are often the highest, but these employees cannot be laid off.

"for most small and medium-sized enterprises, the cost of maintaining ordinary employees is not high. on the contrary, the core employees who create important value are becoming increasingly valuable. this is why layoffs and cost reduction may not necessarily increase efficiency," said yu fei.

in addition, yu fei believes that there is an "extreme value" for reducing labor costs, that is, the cost at which the company can still operate normally. therefore, grasping core employees is the key for companies to control labor costs.

it is worth noting that although many of the interviewed companies are troubled by labor costs, there are still some "lucky ones".

during the interview, the reporter found that some technology companies are in a rapid development stage with good economic benefits. therefore, even if the salary expenditure is high, the employment cost pressure of the business owners themselves is still relatively small.

a person in charge of an information technology company in the coastal area who participated in the survey told the reporter of china economic weekly that the company's employee salary expenditure accounts for 70% to 80% of the company's total expenditure. however, as the company's business is in a growth period, it has not felt the pressure of employment costs.

he said that fast-growing companies have fewer concerns about labor costs. the science and technology park where he is located has a large number of semiconductor chip and pharmaceutical companies. most of these companies are generous in their human resource spending, and there are rarely layoffs or large-scale resignations.

when asked about how to reduce labor costs, the person in charge said with a smile: "the goal of an enterprise should be to be able to afford to raise wages, not to reduce them."

in different regions, enterprises' "feeling temperature" of labor cost pressure varies greatly. in the fourth and fifth tier cities in the west, many small and medium-sized enterprises have relatively low labor cost pressure, which lu yang has a deep understanding of.

he and his friends opened a children's calligraphy and painting training institution. because it is located in a small fourth-tier city, the personnel cost expenses are not high.

"here, it's good for a kindergarten teacher to get 4,000 yuan a month, and most of them only get more than 2,000 yuan a month. in addition, in a small city like ours, many small and medium-sized enterprises do not pay five social insurances and one housing fund for their employees." lu yang said that in the past two years, local private kindergartens and children's education and training institutions have easily recruited teachers with education experience. the cost of living in fourth-tier small cities is not high, so the salary level is also relatively low.

new challenges emerge: employment compliance risks increase

in recent years, with the improvement of laws and regulations and the obvious enhancement of workers' legal literacy and rights awareness, "workplace compliance" has become a key issue in corporate management. while protecting the rights and interests of workers, labor arbitration has also allowed many companies to discover their own employment compliance issues, prompting multiple parties to work together to promote the construction of a healthier and more harmonious labor relationship.

at the same time, during the questionnaire survey, the reporter of china economic weekly found that avoiding employment risks is becoming a thorny issue that many small and medium-sized enterprises must deal with.

the questionnaire results show that among the current challenges facing enterprises in employment, employment legal risks rank second only to labor costs, accounting for 18.06%.

specifically, among the small and medium-sized enterprises participating in the survey, nearly half of them have encountered situations where employees have made unreasonable demands through legal channels. 20.83% of enterprises rarely encounter this, 22.22% of enterprises occasionally encounter it, and 5.56% of enterprises often encounter it. some enterprises reported that there are even a group of professional "pawnshop owners" who, under the "guidance" of professional lawyers, exploit legal loopholes through malicious labor arbitration and other means to demand high or even huge severance pay from enterprises, causing relatively serious economic losses to enterprises.

small and medium-sized business owners trapped by malicious labor arbitration

"i suffered from depression because of the labor arbitration, and now i have to spend money to see a psychologist every week." when interviewed by a reporter from china economic weekly, weng shitao could not hide his pain when he recalled the days of labor arbitration. "i don't even want to recall this!" when he said this, he unconsciously clenched the coffee in his hand.

weng shitao, born in 1994, is the boss of a cultural media company. this year marks the fourth year of the company's operation. recalling the biggest hurdle the company has overcome since its establishment, weng shitao said that it was not market competition or picky clients, but the "battle of wits and courage" between him and his employees.

weng shitao's company currently has about 15 employees. although the number of employees is small, there are no shortage of personnel problems. in 2022 alone, he encountered four employee labor arbitrations.

a "post-00s" fresh graduate gave weng shitao his "first lesson". the fresh graduate performed well during the probation period, so weng shitao decided to formally hire him. however, when preparing to sign the formal contract, the fresh graduate was dissatisfied with the company's job requirements and salary, and decided not to sign the labor contract. "we also thought it was okay at the time, and we couldn't force them," said weng shitao.

unexpectedly, less than a month later, weng shitao received a call from the local human resources and social security bureau, asking him to cooperate with the investigation. "at first i was not panicked, because he was the one who didn't want to sign the contract, and we broke up peacefully," weng shitao said with a wry smile, "but they sued me for irregularities in the probation process, and hoped that we could compensate him for the workload of the past few months with the salary of a regular employee."

weng shitao told reporters that at the beginning, they discussed with the fresh graduate about a probation period and gave him a verbal promise of a probationary salary, but all the procedures were not put into formal written documents. "for example, he had not yet received his diploma, so we did not ask him to submit a certificate of academic qualifications, nor did we give him a written document clearly stating the probationary period. many procedures were verbally agreed upon. without these documents, it is difficult to prove that the period when we hired him was a probationary period, not a formal employment. so facing the accusation, i have no way to defend myself."

in order to cooperate with the investigation and collect evidence, weng shitao spent a lot of time going back and forth. in the end, because he was too tired of collecting evidence, he still paid compensation.

i thought the matter was over, but i didn't expect that many probationary employees followed suit and filed lawsuits against the company. "the people who left taught the people who stayed on how to arbitrate, and they sued us one after another." recalling this, weng shitao began to pull his hair with his hands. "my partner once said to me in tears, it's too annoying, why don't we just close the company."

in the end, these cases were settled with compensation from weng shitao. "for small and micro enterprises like us, the start-up phase is actually very difficult. i really don't want to spend too much time on these things. compared to us, workers have more time and energy to invest in litigation, but i can't afford it, so i choose to keep things quiet," said weng shitao.

when faced with labor arbitration, not only young entrepreneurs like weng shitao, but even experienced bosses in the business world often feel helpless.

zhang xiaolong, 51, has been a boss for nearly 20 years and has been involved in many labor arbitration cases. in the most recent case, he paid a senior employee 200,000 yuan in compensation.

"he was an old employee who had worked here for more than 10 years," zhang xiaolong recalled to a reporter from china economic weekly. "he found a new job a long time ago and started to slack off. construction industry projects require workers to go to the construction site, but he often skipped work and left the workplace without permission, which gradually caused dissatisfaction among the client."

"we transferred him to another project, but he just wouldn't change. after four or five months of going back and forth, i had no choice but to fire him." zhang xiaolong said that after that, the employee filed a lawsuit, and after several months of trouble, he finally compromised.

"this employee has worked for us for so many years and had always done a good job. i heard that he didn't get his new job. so in the end i had to compensate him with one year's salary, about 200,000 yuan," said zhang xiaolong.

in the process of communicating with the heads of various small and medium-sized enterprises, the reporter found that it is not uncommon for employees to "play sloppy" after finding a new job and wait for the company to fire them for compensation. "these people don't take the initiative to ask for resignation, but they just play sloppy all day long and wait for you to fire them. they are just like people who break up with cold violence, dragging me down." weng shitao talked about this, still trying to suppress his excitement.

how to define malicious labor arbitration

during the in-depth investigation, the reporter found that in addition to the conventional labor arbitration cases caused by non-compliance with procedures, there is a group of people who specialize in "touching porcelain" in the current labor market. they take advantage of the gray area of ​​the law and take malicious means such as filing labor arbitration to demand huge severance pay from companies. such cases have also been the focus of public opinion recently.

zhang difeng, senior consultant of beijing zhongwen law firm, explained to a reporter from china economic weekly that "malicious labor arbitration" is a general description of some unreasonable labor arbitration phenomena in social labor employment practices in recent years. there is currently no corresponding clear concept in the law.

he further explained the main characteristics of malicious labor arbitration based on practical cases: first, from the perspective of "worker behavior", such workers often frequently sign labor contracts with different companies, and the labor relationship lasts for a short period of time; during the employment period, workers deliberately create disputes by passive resistance, provocation, malicious collusion, etc.; workers deliberately refuse to sign, delay or find someone to sign a written labor contract on their behalf, actively request not to pay social insurance, deliberately get injured during work or deliberately work overtime, etc. second, from the perspective of "reasons and purposes of labor arbitration", the reasons for workers to terminate labor contracts and apply for arbitration are unreasonable, lack effective evidence, and are illogical, and they attempt to obtain compensation or damages through false statements.

"malicious labor arbitration uses labor and personnel dispute arbitration procedures to interfere with the normal operation of employers, infringe upon the legitimate rights and interests of employers, and undermine the social credibility system and harmonious labor relations. it not only violates the principle of honesty and trustworthiness stipulated in the labor contract law, but also exacerbates the distrust between employers and employees, disrupts the order of labor arbitration, wastes judicial resources, and slows down the efficiency of rights protection for workers who really need to protect their rights. it can be said that malicious labor arbitration is harmful to workers, employers, and the entire social order." zhang difeng said.

in this regard, zhang difeng said that companies can deal with this type of "malicious labor arbitration" in three ways:

at the institutional level, employers should establish and improve the employment management system, standardize employment procedures, and strengthen risk prevention in key links such as labor contract management, social insurance payment, wage payment and performance management. at the same time, enterprises should also actively assume social responsibilities, care for employees physically and mentally, and build a harmonious labor-employment relationship.

at the mechanism level, employers should improve the background check mechanism before employment, strengthen source governance and risk prevention and control. zhang difeng reminded: "in order to prevent the above-mentioned "pawnshop" behavior, employers can also check on relevant websites such as the "china judgment documents public network" to see whether the employee is involved in multiple labor lawsuits and whether there is a possibility of malicious rights protection."

in terms of response, once a "pawn shop" incident occurs, small and medium-sized enterprises should take positive and proactive measures to respond. they should actively communicate and negotiate, clarify the other party's core demands, pay attention to the fixation and collection of evidence, and actively seek judicial relief.

"the relevant state departments should also increase the supply of systems in terms of laws and policies in a targeted manner to provide policy and institutional basis for preventing and combating similar phenomena," zhang difeng added.

fortunately, some regions in china have already made relevant explorations. according to zhang difeng, some regions in china have established and improved the "labor rights protection exception list" system, allowing employers to check whether workers are on the exception list before hiring them, so as to decide whether to establish a labor relationship with them.

know the law, abide by it and use it well to solve the problem of employment compliance

faced with employees who often "slack off" and exploit legal loopholes, although they are indignant, whether it is weng shitao or zhang xiaolong, many heads of small and medium-sized enterprises admit that their companies still have shortcomings in legal compliance.

"my partner and i reflected on this and realized that we did have compliance issues with our processes. at that time, we had only been graduate students for two or three years and we didn't understand anything at all," weng shitao helplessly admitted to reporters.

zhang xiaolong also admitted that he knew very little about the law, and most of the time he hired a lawyer only after he encountered a real problem. "we don't have a professional legal team. many times, we only think of hiring a lawyer when we encounter a problem, but the litigation fees are expensive. so many times i just think about paying money and getting away with it."

so, what are the common compliance risks faced by small and medium-sized enterprises, and how can they be avoided?

fan zhaofeng, deputy director of the labor arbitration committee of the jiangbei district lawyers association of chongqing, revealed to a reporter from china economic weekly that small and medium-sized enterprises are prone to labor arbitration when their systems are not standardized during the initial stage and when their economic benefits are poor. the arbitration requests generally involve wage arrears, compensation for failure to sign a labor contract, economic compensation for termination of a labor contract, and compensation for illegal termination of a contract.

zhang difeng summarized the common compliance risks faced by small and medium-sized enterprises from the perspective of the employment environment.

first, in the employee recruitment process, some employers lack regulations on recruitment publicity, which makes the human resources department more casual when publishing recruitment advertisements or recruiting, and there are non-compliant behaviors such as false propaganda or discriminatory content in recruitment advertisements. second, in the actual employment process, some employers have not signed a labor contract with the workers or have not signed a labor contract with the workers within one month from the date of actual employment, arbitrarily extended the probation period, did not pay for the workers or agreed not to pay social insurance during the probation period, illegally withheld wages for workers or wages were lower than the minimum wage standard in the employer's location, illegally agreed to liquidated damages other than service period and non-competition restrictions, and illegally terminated labor contracts. third, in the system management process, the content and procedures of the labor system of some employers are illegal, such as: some companies stipulate that employees work overtime without pay, illegal penalties (including illegal fines, corporal punishment, public exposure) and other non-compliant regulations.

in this regard, zhang difeng suggested that enterprises should establish and improve a "full life cycle compliance management mechanism" for labor employment, identify compliance risks, clarify compliance obligations, and formulate targeted compliance management measures for key links such as employee recruitment, labor contract signing, employment process management, and resignation management.

for example, during the labor contract signing process, employees who establish a labor contract relationship must sign a written labor contract in a timely manner and standardize the content of the labor contract. for clauses involving the vital interests of employees, such as labor remuneration, working hours, rest and vacation, etc., specific standards and implementation methods should be clarified to avoid ambiguity or misunderstanding.

yu fei holds a similar view. he said that once small labor disputes form a risk chain, the company is prone to bankruptcy, because any form of labor risk affects the company's brand phenomenon and cannot be ignored. "small labor risks cannot be avoided, and companies must actively respond to labor risks." he said.

faced with compliance risks, some heads of small and medium-sized enterprises, especially many younger generations, have begun to focus on building legal teams.

yang rui, deputy general manager of sichuan minsheng pipe industry co., ltd., told the reporter of china economic weekly that he has been in charge of the company's daily operations for more than two years, but the company has never encountered unreasonable labor arbitration in these two years. when talking about the secret, yang rui couldn't help but smile confidently: "because we have a professional legal team. our professional team can help us check at every link from recruiting to employing, and avoid compliance risks." he believes that enterprises must know the law and abide by it, and they must also learn how to use the law and use legal weapons to protect their own rights and interests.

however, during the investigation, the reporter found that most small and medium-sized enterprises are small in size, especially for some small and medium-sized enterprises in the start-up stage, it is difficult to have the time and funds to set up a professional legal team. some business leaders have begun to strengthen their legal literacy or use digital means to make the employment process as compliant as possible to avoid loopholes.

lin yongzhi runs a live streaming e-commerce company in beijing, which currently has about 30 full-time employees. as he has many years of work experience in the internet industry, he has always had a strong sense of compliance. "i have studied the labor law, advertising law, etc., and i have a good understanding of the laws and regulations." lin yongzhi told the reporter of china economic weekly.

"many people think that overtime is serious in the live streaming e-commerce industry and that related companies do not understand labor laws. in fact, this is not the case. our company strictly implements the 8-hour work system for work scheduling, and everything in performance appraisal is digitized. the entire process is recorded and transparent, which avoids many disputes." lin yongzhi said.

seeking solutions for harmonious labor relations in the new era

whether labor relations are harmonious or not is related to the development of enterprises and the interests of employees, and is related to social harmony, stability, development and progress. the reality reflected in this survey shows that creating harmonious labor relations in the new era is not only a must-answer question for every small and medium-sized enterprise, but also a common goal of multiple forces in the entire society.

at present, from the central government to local governments, all levels are exploring solutions to harmonious labor relations in the new era. many small and medium-sized enterprises are also trying to answer their own questions and build harmonious labor relations at the micro level.

paving the way with policies and systems to achieve harmonious and win-win results

in recent years, the central government has introduced a series of policies to lay the institutional foundation for harmonious labor relations in the new era.

in 2015, the cpc central committee and the state council issued the "opinions on building harmonious labor relations". this document is considered to be a programmatic document guiding labor relations work in the new era, and it has opened a new stage in the creation of harmonious labor relations.

in 2021, the "harmonious labor relations creation activity" (held every three years) was listed as a national demonstration activity project of the ministry of human resources and social security, and the "national harmonious labor relations creation activity commendation" was adjusted to "national harmonious labor relations creation advanced collectives and advanced individuals" (held every five years), providing strong institutional support for harmonious creation activities.

in january 2023, the ministry of human resources and social security, the all-china federation of trade unions and others jointly issued the "opinions on promoting the creation of harmonious labor relations in the new era" (hereinafter referred to as the "opinions") to re-mobilize and re-deploy activities to create harmonious labor relations in the new era and new journey.

under the guidance of the "opinions", various regions have accelerated their pace and launched a series of activities to create harmonious labor relations.

for example, liaoning has launched a harmonious enterprise cultivation campaign, proposing to strive to make 100% of the cultivated enterprises become enterprises with legal and compliant employment management, and 80% of the cultivated enterprises become harmonious labor relations enterprises with effective negotiation mechanisms, normal growth in employee wages, adequate employee welfare guarantees, and win-win cooperation and common development between the two parties in labor relations; sichuan has jointly launched a pilot reform and innovation program for high-quality development of harmonious labor relations in the chengdu-chongqing twin cities economic circle with the human resources and social security department of chongqing, focusing on county-level carrier platforms to promote the construction of pilot demonstration zones, pilot demonstration zones, and collaborative demonstration zones for harmonious labor relations.

li chang'an, professor at the national institute of international strategy at the university of international business and economics and head of the ministry of human resources and social security's project "research on promoting employment priority policies at home and abroad", said in an interview with a reporter from china economic weekly that the country's employment stabilization policy has also played a role in building harmonious labor relations in the new era.

"in recent years, local human resources and social security bureaus have successively introduced subsidies to stabilize employment, helping enterprises save labor costs and thus stabilize the business environment." li changan analyzed that in the future, human cost expenditures will be concentrated on talent recruitment. scientific and technological talents will be important human capital in the future, and creating harmonious labor relations will enable enterprises to gain an advantage in future talent strategies.

harmonious labor relations require joint efforts of enterprise employees

regarding how to build harmonious labor relations in the new era, many experts believe that both enterprises and employees need to work together.

"labor expenditure is an important part of corporate costs, and companies must have a correct understanding of this part of expenditure." li changan believes that companies should face up to labor cost expenditure rather than try to reduce it.

"enterprises must first improve their management awareness and treat workers as important human capital rather than a burden." li changan further explained that there is a famous efficiency wage theory in economic management, which states that if workers' wages are increased, their enthusiasm will increase and the company's production efficiency will also improve. therefore, increasing labor cost expenditure is not contradictory to enterprise development, but is in the same direction.

although from a business perspective, the return on human cost investment is relatively invisible and difficult to quantify, a harmonious working environment and good team relationships can improve corporate production efficiency and generate higher value.

therefore, li changan suggested that in the process of employee management, companies should fully recognize the importance of mutual respect, establish a good employee feedback mechanism, and work towards the goal of common development and progress between the company and its employees.

he also specifically mentioned that companies should find a balance between employees' material and spiritual needs, give employees respect, and build a harmonious and positive working atmosphere. this is a low-cost, high-return method.

yu fei analyzed the issue from a legal perspective. he said that the image of businessmen who are profit-driven is deeply rooted in the minds of some people. this has led to the fact that after labor disputes occur, many people's first reaction is that the company has violated regulations. some employees have been influenced by this and have been suspicious of the company since they started working, which has also created demand for the "malicious labor arbitration" group.

yu fei believes: "enterprises should continue to improve their laws and regulations. at the same time, the rule of law environment should also be improved. it is necessary to protect not only workers but also small and medium-sized enterprises with normal management and operation, and promote harmony between the two sides."

many of the interviewed business owners and workers also realized the importance of building harmonious labor relations in the new era, and actively started from themselves to build harmonious labor relations around them.

"i am also reflecting on this. there are indeed many irregularities on the company side, and we will continue to improve. now i communicate with employees frequently, and i find that most of the problems can be solved if they are communicated in advance. the company and employees can also gradually understand each other during communication. i am currently considering how to establish a more effective communication mechanism in the company so that everyone can work together," said weng shitao.

some "working people" also expressed similar views to reporters based on their personal experiences.

"when i was in my last company, i always sulked or complained online when i was wronged, but it was useless except for venting. in the end, because i complained about my boss on wechat moments, the company found out and fired me. i filed a labor arbitration, and although i got compensation, the whole process was very exhausting." a shanghai "worker" told china economic weekly. "later, i also grew up. when facing my current boss, i often take the initiative to raise demands. if i have any dissatisfaction, i communicate politely. if everyone understands each other, the relationship will be harmonious."

(at the request of the interviewees, lu yang, weng shitao, lin yongzhi, and zhang xiaolong are pseudonyms in this article.)