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China Published Judicial Interpretations on Trial of Labor Dispute Cases
12 February 2013
In respect of the non-competition clause, although according to the PRC Labor Contract Law, the non-competition period can be a period up to two years, the said judicial interpretations stipulate that the employer is entitled to early terminate the non-competition period provided that in such a case, the employee shall have the right to claim for an extra compensation equivalent to the amount of three months' compensation for the non-competition.
In respect of the compensation for non-competition, the said judicial interpretations stipulate that if an employment agreement includes a non-competition clause but has no stipulation on compensation for such non-competition obligation, then the employee will be entitled to claim for the compensation monthly for his duly performed non-competition obligations, and such compensation will be either 30% of that employee's average monthly salary over twelve months' period preceding the termination or expiration of the employment agreement, or the minimum monthly salary standard applicable in the place where the employment agreement is performed, whichever is the higher.






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Disclaimer
Any legal information contained in this newsletter is general in nature and laws and regulations are changing from time to time and compliance will always depend upon the particular circumstances. We have not attempted to give exhaustive descriptions of law or to give a legal opinion on specific legal issues. You should not rely on this newsletter as a legal advice for any particular purpose.

 

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