When special working hours are not approved, what can an employer do under the standard system?

Comprehensive working hours and non-fixed working hours are special working hours systems of real importance to an employer's management of its workforce. Since the Notice on the Guidelines on the Rules for the Approval and Supervision of Special Working Hours Systems in Enterprises (Ren She Ting Han [2024] No. 175) was issued, however, the human resources and social security authorities in this Municipality have scrutinised applications more strictly. Most guard and cleaning posts are rostered for 12 hours a day or more and can no longer obtain approval, so only the standard system can be applied, and hours worked beyond eight a day must be paid as overtime — and may even exceed the statutory overtime limits. How, then, can working hours be arranged lawfully under the standard system?

The law provides expressly for no more than eight hours a day and no more than 40 hours a week (44 hours under the Labor Law), for at least one rest day a week, and for overtime of no more than three hours a day and 36 hours a month. Drawing on practice, I suggest the following approaches, for reference only and subject to local judicial practice.

First, shorten each shift and add staff. Where two people previously covered a shift, working one day on and one day off for 12 hours each, three people can work the same pattern in three shifts of eight hours each. That is lawful, but it raises labor costs. In practice disputes arise over shift changes, for example whether moving an employee from the day shift to the night shift requires consent. The mainstream view is that consent is required. In (2022) Hu 0120 Min Chu No. 21893 the court held that the claimant had worked the day shift for a long time and that the difference between day and night shifts has a considerable effect on work and rest, so where an employee refuses night work the employer should not simply require compliance but should discuss the matter and seek a moderate solution; here the claimant had expressly refused the change, no agreement was reached, and the defendant merely posted a work schedule without proposing a new arrangement; and the defendant offered no safeguards for the night shift and no reasonable answer on commuting time and distance, simply requiring compliance. The change was therefore unreasonable and the employer had not properly discharged its duty to consult.

Second, arrange weekly rest days flexibly. Under the standard system the weekly rest days may be fixed by the employer according to production and operational needs and need not fall on Saturday and Sunday, so the two rest days may be taken from Monday to Friday (work on those days being overtime), while Saturday and Sunday become normal working days rather than overtime.

A six-day week can be arranged flexibly: six days of 6.5 hours (39 hours a week), six days of seven hours (42 hours a week, with two hours of minor overtime), or five days of seven hours plus one day of five hours (40 hours a week). Flexible arrangement of this kind meets the employer's production and operational needs.

Fourth, adopt a piece-rate wage system. Employers that meet the conditions may lawfully set piece-rate quotas for employees paid by the piece. The piece-rate system is also subject to the standard system, but once the quota has been completed, additional time worked is not counted as overtime. The piece-rate quota should be set reasonably through a democratic management procedure.

Fifth, arrange time off in lieu for overtime on weekly rest days. With the employee's written consent the original 12-hour daily schedule may be retained, with the four extra hours made up by rest on the following or another day, and overtime pay where the hours cannot be made up. This applies only to lawful adjustment of overtime, and working four hours beyond the normal day still risks investigation by the labor inspection authorities and loss in litigation, because the three-hour cap is exceeded. Daily hours are therefore best kept to no more than 11, that is, within the three-hour overtime cap, with time off arranged properly. In (2017) Ning 05 Min Zhong No. 696 the court held that under Article 41 of the Labor Law of the People's Republic of China — under which an employer may, for production or operational reasons and after consultation with the trade union and the employees, extend working hours, generally by no more than one hour a day, or, where extension is necessary for special reasons and the employee's health is protected, by no more than three hours a day and 36 hours a month — the company's rule that guards work 12 hours a day breached that mandatory provision; the first instance had been right so to find, and the ground of appeal failed.

Sixth, arrange night shifts or standby duty on statutory long holidays according to actual operations. Standby duty differs from overtime: overtime is a continuation of normal work, whereas standby duty is usually arranged for security, fire safety or holiday cover on a special and temporary basis, is non-productive work performed outside normal hours, may generally be taken as rest at the workplace, and apart from patrols, records and reports allows the employee to use the duty room as he or she wishes. In (2019) Hu 0117 Min Chu No. 9958 the court held that where an employer arranges standby duty connected with the employee's own work but the employee may rest during it, the time is not treated as overtime. The defendant had arranged for the claimant to perform standby duties connected with her work at home after hours; the place of work was her home, and on her own account if she was showering or dealing with personal matters and did not see a customer's message, Mr Ma would handle it. The employer's requirements as to time were relatively loose and she could attend to personal matters, so the court could not support her claim for overtime pay.

In summary, the standard working hours rules are mandatory, but within them there is room for flexibility. An employer must choose a lawful and reasonable arrangement suited to its own operations, so as to reconcile the needs of the business with the organisation of working time, reduce labor disputes and foster a sound business environment.