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NEWS ALERT: Wuhan Coronavirus and its impact on employers

Amid the outbreak of the Wuhan coronavirus, China´s central government implemented immediate emergency measures to gain control over its spread, including the extension of the Chinese New Year holiday period.

On 26th January 2020, the State Council of the PRC announced that the Chinese New Year holidays would be extended to 2nd February 2020, following which local governments of Shanghai, Guangdong Province, Zhejiang province and other cities, inter alia Nanjing, Suzhou, and Wuxi on basis of the Law of the PRC on the Prevention and Control of Infectious Diseases issued notices to suspend work until either 8th or 9th February 2020 respectively. Enterprises under the jurisdiction of those provinces, municipalities and cities are required to comply with the notices on work suspension, except for enterprises engaged in public services. In Shanghai and Nanjing, a specific prior approval granted by the respective competent local epidemic prevention and control offices must be applied for and obtained, in the event an enterprise, for special reasons, needs to resume work earlier.

During the extended holiday period, enterprises are required to pay salaries to their employees without deductions and are not allowed to arrange for their employees to take paid annual leave. Consequently, for employees who applied for annual leave during the extended holidays, such annual leave days shall be credited towards the employees´ annual leave entitlement.

According to the Shanghai Municipal Human Resources and Social Security Bureau, the suspension of work shall be regarded as "days off", however, an employer may arrange for its employees to work from home, provided that the employer arranges for its employees to take deferred days off-in-lieu or pays overtime salaries at the rate of 200% of the normal daily salaries. It should be noted that other cities may provide for a different compensation scheme.

Employees suspected of having contracted the Wuhan virus and therefore, are quarantined for observation are to be paid full salary during the isolation and observation period. Once confirmed having contracted the virus, affected employees´ salary entitlement shall be subject to the Provisions on medical treatment period of sick or non-work-related injuries of employees.

Employers are prohibited from terminating employees affected for convenience during the period of observation and medical treatment.   

Disclaimer: This article has been prepared for general reference purposes only and should not be relied on as legal advice or regarded as a substitute for detailed advice in individual cases. Professional advice appropriate to a specific situation should always be sought. 

Contact person
Raymond Kok, Shanghai