Termination of a Chinese labor contracts based on wrongful information on the resume

The number of lying job candidates is very high, according to a US study from 2017 85 % of job candidates try to make their application enhance through untruthful dates and facts about their business career and education. Especially in China lying about the educational level in favor for a better occupational outlook is a big topic, that’s worth talking about.

Of course we like to hire people with impressive professional experience, a wide-ranging education and different skills. But what if those people with this perfect resume are lying?
If they are uncomfortable with his own skin, how would they act if they have made a mistake while working for you, would they try to cover it up too? What if the candidate has no experience at all, would he tell his employer that he is not able to do his job?
Clearly no employer wants to worry about what they can do labor-law related, if they hire a person and find out later that he or she was lying about their resume and is not suitable for this kind of position. Even if he does his job, but has no education at all, the agreed salary wouldn’t equal the employees Value. Besides that, the employer would never know if he or she could really trust this person.

So, before it comes to thoughts about termination, severance or contract adaption, there are some techniques to avoid this kind of situation and spot a lair:[1]

Using behavioral interviewing techniques. By asking detailed questions

  • about a candidate's work experience, for example, if a candidate claims to have
  • 10 years' experience as a team leader, the recruiter will ask for examples of how
  • the person has hired, trained, and even fired talent. The quality of the responses
  • will show if the experience is real.

Purchasing an online background check. “trust but verify”

  • So it’s also better to earn the trust, rather than be assumed trustworthy until proven otherwise.

Backdoor reference checks. Their goal is to speak to someone NOT

  • recommended to them by the candidate. The best way to talk to a reference is
  • to take notes during job interview and let the reference confirm the who, what, where.


But what if you hired someone now and found out later that this person lied about their educational stand, faked graduation certificates or job experience? There are different deliberations and legal consequences depending on the fact during which time the truth will be uncovered.

1. During the Probationary period

The probationary period can rage from one to maximum of six months, depending on the overall term of the contract due to Article 19 LCL and is allowed only one time for the same employee.

  • 1 month, if the contract’s term is three months to one year
  • 2 months, if the contract’s term is one to three years
  • 6 months, if the contract’s term is three or more years or not fixed

During this period an employer can unilateral dissolute the employment contract according to article 39 of LCL through termination due to fault or misconduct.

Before the probation period ends, if the employer can prove that the employee does not meet its recruitment requirements, due to the LCL the employer can unilaterally terminate the employee without having to pay statutory severance. Additional the employer has to state the grounds for the termination.

Due to the Beijing Higher People’s Court and the Beijing Employment and Labor Arbitration Commission, who issued the Answers to Questions on Application of Law in Trial of Labor Dispute Cases in 2017, some examples of being “unable to meet satisfied employment conditions” are[2]:

  • concealing or making up facts about basic information or documents which has an impact on the performance of the employment contract
  • This includes providing false academic certificates, ID certificates or other important certificates, or making materially false statements
  • about experience, skills, health conditions or other personal information.

So if the employer can establish a statuary ground, like one form above, the employer can unilaterally terminate the contract without giving prior notice or severance to the employee. After this probationary period has passed, termination of an employee in China usually requires good cause as well as a severance payment in most cases.

2. Termination after the probationary period

In China the legal process for terminating an employee is much more employee friendly than in other countries. Therefor if the probationary period is over the employer must provide legitimate grounds for a termination.

According to Article 39 LCL an employer can terminate an employment contract due to the following causes:

  • If the employee has violated the company’s rules or procedures.
  • If the employee has been committed dereliction of his duties or seeks private benefits, resulting in severe damage to the company’s interests.
  • If the employee has committed a crime.
  • If the employee has additionally established an employment relationship with another employer which materially affects completion of his tasks with the first employer or refuses to rectify the matter after the employer points out the problem.
  • If the employee has deceived, coerced, or taken advantage of the employer’s difficulties, to cause the employer to conclude an employment contract, or to make an amendment, contrary to the employer’s true intent.
  • If the labor contract is invalid due to reasons specified in Article 26 of the labor contract law

2.1. The next cause can be legal ground for an employee termination, for the special issue of wrongful statements on the resume.

If the company has been damages through the actions of the employee, the employer has to provide prove of the damage and that the employee was responsible for it. Additionally, the employer could support his claim, if he proves that the education/ knowledge/ experiences, which the employee stated during the hiring-process are not existing and that there is a correlation between that employee’s misdoing and his lack of skills. Optional the employer always has to think about the termination without cause too, for the case that there are not enough legal grounds for a termination with cause. For the termination without cause according to article 40 and 41, the employer has to give the employee a 30-day prior written notice or pay the employee the amount that he or she would have gotten during the notice period. He or she is also entitled to ask for statutory payment due to article 46. (= one average monthly salary for every year that the employee has worked for the employer).

2.2. Due to next cause, if the labor contract is built on wrongful information’s, provided from the employee, the contract can be invalid or partly invalid.

The employee shall provide objective information. The Article 3 of the LCL states that the employee shall meet the specified quality standers. Article 8 oft the LCL predicates “that the company has the right to know basic information about the employee which directly relates to the labor contract, and the laborer shall truthfully provide the information.”Conclusion from both articles are that the employment contracts shall comply with the principle of good faith. [3] An aspect of the principle of good faith is that both parties have the right to know with whom they are working and especially about the important information’s which are relevant for the company.

Therefore, if the employee quotes wrongful information’s on their resume or during the job interview and if that information was the decisive factor for the employment, this employment contract shall be invalid due to article 26 of LCL.

Article 26. A labor contract shall be invalid or partially invalid if: one party uses such means as fraud, coercion or taking advantage of the other party’s unfavorable position to sign the labor contract against his or her genuine will.

Furthermore, in accordance with Article 39 of LCL, the company can terminate the employment contract with the employee. To keep in mind, that the wrongful given information, which led to the employee termination must be absolutely necessary for the performance of the employment contract, otherwise it would be hard to uphold a lawful termination by the judicial authority. Despite the fact that the employee’s liability is the ground of the invalid contract and furthermore the ground of the termination, the company has to pay the employee remuneration for his working time before the termination remuneration. According to Artic 28 LCL the amount of remuneration shall be determined with reference to the remuneration of employees in the same or similar position with the company. In accordance with article 39 of LCL, when an employer terminates an employee for fault or misconduct, notice and severance are not required, and it takes immediate effect upon the employee’s receipt of a termination notice. Never less, keep in mind that the termination progress is clearly employee friendly. For the case the termination with cause is not going through in front of the judicial authority, it is highly recommended to plan also a lawful termination without cause due to Article 40 and 41.

3. Contract adaptation

3.1. As previously mentioned the employment contract can be terminated on grounds of deception by the employee.

Another possibility for the employer is to keep the employee, if he or she is a benefit for the company, even if he or she mad wrong statements on their application or during the selection process before. In this case the employee may not equal the amount of remuneration arranged in the labor contract. Therefore it would be advantageous to modify the provisions of their contract. The remuneration is an essential part of the employment contract and therefor a delicate matter to discuss. The best way to do that is through an accordance agreement between employer and employee due to article 35.

If an employee accepts or shows no objection to the pay cut consummation that is also a of successful consultation. It is often a common practice for the employer to obtain the employee’s signature on a written payroll modification or pay cut notification following the consultation. This notification services as additional written evidence of the employee’s consent on top of the contract.[4]

There is no law of a right for the employer to uniliteral make a pay cut to an employees salaries if he or she gave wrongful information about their skills or education.

Article 40.2 says that “a company may dissolve the employment by giving the laborer 30 days prior written notice, if the employee is proved incompetent and remains incompetent after training or adjustment of his position”;
This law also implicates that the employer can unilaterally change the employees position or salary, if the employee can’t make his job according to the employment contract. It is important that such a unilaterally payment cut has to be detailed regulated in the intern rules and policies, otherwise the cut wouldn’t be permissible.

3.2 As mentions before the labor contract can be invalid or party invalid.

In case only certain provisions of the labor contract are invalid due the article 27 LCL, which are not affection the validity of the remaining provisions, the remaining provisions shall remain valid. It’s highly advisable that the all amended provisions shall be recorded in written form, so that there will be no misunderstanding later one.


Regardless if it comes to remuneration reductions the Chinese labor law is highly protective of employee’s rights. So, it’s important that the employer knows the legal details. Starke assists you with all kind of labor matters and contract terminations. 


[1] https://www.lexology.com/library/detail.aspx?g=da0791a1-3e72-40d1-ba63-4...

[2] https://www.inc.com/jt-odonnell/staggering-85-of-job-applicants-lying-on...

[3] http://www.mondaq.com/china/x/375396/Contract+of+Employment/False+inform...

[4] http://www.china-briefing.com/news/2017/05/09/chinas-labor-law-salary-re...