22 November 2018

Sick Leave

Yin Juquan, Zhang Yuanhao

It is common to see a doctor when people feel ill. No one can guarantee that he/she is always healthy. Employees are entitled to sick leave. Labor Law and Labor Contract Law both provide that employees are entitled to salaries and social insurance payment during sick leave, and are exempted from unilateral termination or end of employment contract without fault.  However, it is not unconditional to ask for sick leave. Provisions on Medical Treatment Period for Sick Employees or Employees with Non-Work-Related Injuries further specifies medical treatment period to clarify methods and restrictions of taking sick leave. Although employers shall care about sick employees, employers should treat situations where employees ask for sick leave in bad faith and sick leave exceeds statutory limitations strictly. The following paragraphs illustrate some suggestions employers should pay attention to.

When employees asking for sick leave are not sick

Only sick employees can ask for sick leave. The fact that an employee is sick and in need of a rest is the condition for taking sick leave. A sick leave certificate with official seal issued by qualified medical institutions is a direct evidence to prove such a fact. Generally, employers approve sick leave even if receiving fake certificates without further confirming with the medical institution, which contributes to some employees’ false request for sick leave. Such employees not only negatively affect the employer’s normal working arrangement and increase cost of employment, but also defraud the employer of salaries for sick leave. Further, such conduct seriously damages mutual trust between employees and employers, which does no good to both parties. Employers have to find out and act against such conduct without tolerance or lenience.

For instance, in Li v. Company A [1], Company A believed that the text message asking for sick leave, sent on April 20th, 2011, and the certificate issued by Beijing Obstetrics and Gynecology Hospital, provided by Li, were inconsistent with the returned express delivery stating “please send after phone call because of being overseas,” which Company received on April 21st, 2011. Therefore, Company A required a review with Li, but Li rejected without excuses, and thus Company A deemed that Li intentionally deceived the company by providing false information and such behavior constituted serious violation of internal regulations. On August 23rd, 2011, Company A sent the Notice on Termination of Employment Contract to Li in person and unilaterally terminated the employment relationship due to providing false materials of sick leave and absence from work. 

During the trial of second instance, the court obtained Li’s records regarding exit and entry, which indicated that Li went to the U.S. on February 23rd, 2011, and returned China on June 8th, 2011. However, during the above period, Li provided Company A with the diagnose certificate issued by Beijing Obstetrics and Gynecology Hospital, and Li could not provide any reasonable explanation. Therefore, the court found that Li violated the principle of good faith, and thus Company A’s termination was lawful. Employers may act against employees requesting sick leave in bad faith according to internal regulations.

When sick employees are absent without asking for sick leave

Generally, employers have procedural regulations regarding sick leave, which is the formalities for sick leave. When an employee is absent from work due to illness without asking for sick leave or asking for sick leave in a timely manner, it can exert negative effect on the employer’s normal operation. However, since there exists the fact that the employee is sick and deserves sick leave, according to the principle of inclined protection for employees, most judgments are made under the consideration that it is reasonable to alleviate or even discharge the obligation to complete sick leave formalities for employees. Accordingly, if employers take severe disciplinary actions against employees or even fire employees only for this reason, there can be higher risk of losing the case if labor disputes occur. 

For instance, in Song v. Company B[2] , Song called Wang, his supervisor, to inform the injury and hospitalization after Song was involved in a traffic accident, but Song failed to complete the formalities for sick leave. Company B unilaterally terminated the employment relationship with Song on the grounds of continuous absence from work. The court held that Song had notified the company of the accident, and thus Song was not absent for no reason. Moreover, it was during medical treatment period, which did not constitute serious violation of internal regulations. Therefore, the court found that Company B’s termination was illegal.

When sick leave ends

As to employees taking sick leave, employers shall pay them sick leave salaries according to relevant laws and regulations. In other words, when employees are taking sick leave, employers not only have to arrange other employees to fill in vacancies of labor force, but also need to bear the cost of employment during employees’ sick leave, which embodies the inclined protection for employees. However, if the employee needs to undergo treatment for a long time and cannot return to work, is the employer required to pay sick leave salaries until the employee retires? The answer is negative because rights and obligations are limited.

According to Provisions on Medical Treatment Period for Sick Employees or Employees with Non-Work-Related Injuries, employees asking for sick leave are subject to the limitation of medical treatment period. If medical treatment period expires, the employer has the right to disapprove sick leave application and treat it as personal leave. Besides, according to Article 41 of Labor Contract Law, “under any of the following circumstances, the employer may rescind the labor contract by giving the worker a written notice 30 days in advance or by making an additional payment of one month's wage to the worker: (1) where the worker suffers from an illness or a non-work-related injury and is unable to undertake the original job duties or other job duties arranged by the employer following completion of the stipulated medical treatment period . . .” Under such condition, the employer is entitled to unilateral termination of employment contract. However, who is eligible to decide what constitutes being unable to undertake the original job duties or other job duties arranged by the employer? According to Article 6 and Article 7 of Provisions on Medical Treatment Period for Sick Employees or Employees with Non-Work-Related Injuries, labor evaluation committee should evaluate the employment capacity with reference to evaluation standard for degree of work-related injuries and occupational disability. Otherwise, employers will be subject to higher risk of losing the case if labor disputes occur.

For instance, in Guo v. Company C [3], the company sent a letter to Guo on February 25th, 2011, requiring Guo to cooperate in employment capacity evaluation within 7 days due to expiration of medical treatment period, but Guo failed to cooperate within 7 days. Thus, the company sent notification on termination of employment contract. The court held that Company C failed to prove that it served Guo with the letter, and 7 days were too short to undergo employment capacity evaluation, so Company C terminated the employment contract illegally. 

Such a case leads to a difficult issue for employers, which is what if the employee refuses to cooperate in employment capacity evaluation. In practice, it is critical for employers to provide evidence proving such a fact. If the employee does refuse to cooperate, the employer is entitled to unilateral termination. For instance, in Wei v. Company D [4], Company D sent position transfer notice to Wei, whose medical treatment period expired, but Wei failed to return to work. The company then sent written document requiring return, but Wei failed to return again. The company required Wei to cooperate in employment capacity evaluation in writing, but Wei failed to cooperate. Finally, the company sent written notice on termination of employment contract, and served by publication on newspaper. The court held that Company D terminated the employment contract lawfully.


[1]Case Citation: (2013)Er Zhong Min Zhong Zi No. 07324.

[2]Case Citation: (2014) Sui Zhong Fa Min Yi Zhong Zi No. 7161.

[3] Case Citation: (2014) Er Zhong Min Zhong Zi No. 09208.

[4]Case Citation: (2018) Jing 01 Min Zhong No. 1735.

A Guide to Doing Business in China

We explore the key issues being considered by clients looking to unlock investment opportunities in the People’s Republic of China.

Doing Business in China
Share on LinkedIn Share on Facebook Share on Twitter Share on Google+
    You might also be interested in

    Jack, a US national, is a middle-level manager of a foreign-funded hotel management company and used to work in Tianjin.

    12 August 2019

    On May 31, 2018, the regulations of Guangdong Province on population and Family Planning (hereinafter referred to as "the Regulations") were further amended.

    16 April 2019

    On April 24, 2017, Beijing Higher People's Court and Beijing Labor and Personnel Dispute Arbitration Commission jointly issued the Answer on the Legal Application of Labor Dispute Cases (hereafter...

    16 April 2019

    This article was written byJunlu Jiang(Partner) and Chenkun Li(Associate assistant). Jiang Chai is an online taxi driver. He became a staff member of Beijing Changxing Traffic Co., Ltd. (hereinafter...

    24 May 2018

    You may also be interested in...

    Legal services for your business

    This site uses cookies to enhance your experience and to help us improve the site. Please see our Privacy Policy for further information. If you continue without changing your settings, we will assume that you are happy to receive these cookies. You can change your cookie settings at any time.

    For more information on which cookies we use then please refer to our Cookie Policy.