Research On The Liquidated Damages System Of Labor Contract In China

In practice, the liquidated damages of labor contract dispute frequently. Employers usually restrict the mobility of workers by setting excessive liquidated damages of labor contract. Consequently, workers' freedom of choice is infringed, reasonable and orderly labor flow is restricted. These results are not conducive to economic development and the harmonious and stable society. Before "Labor Contract Law" enacted, views for the liquidated damages of labor contract are different between the theory and practice communities sectors, national legislation and local legislation, reflected in the following three theories: freedom, restriction and forbiddance. Finally, "Labor Contract Law", which is started to implement on 1 January, 2008, supports the theory of restricting the liquidated damages of labor contract. What extent should the liquidated damages of labor contract be restricted to? What standards should be used? What is the nature of the liquidated damages? How to determine the scope of the liquidated damages? However, this act doesn't answer these questions. Beginning with the conception of the liquidated damages of labor contract, with the methods of comparative analysis, historical analysis, value analysis and other research methods, the author tries to answer these questions and put forward her views and suggestions on the base of analyzing and demonstrating the liquidated damages system of labor contract.This paper consists of three parts. The first part is the summary of this paper. In this part, the author defines the conception of the liquidated damages of labor contract, introduces the main theories in the theory circle about the liquidated damages of labor contract, and presents the legislation related in China. The second part deeply analyzes the basic theory of the liquidated damages of labor contract. In this part, starting from the nature of social law, the author dialectically analyzes the justification of restriction on the liquidated damages of labor contract. On this basic, the author analyzes the basic theory of the liquidated damages system of labor contract, such as its nature, object and scope of application, amount of damages. The third part appraises the liquidated damages system of labor contract in China. In this part, the author points out that the existence of excessive liquidated damages in great quantity is rooted in the disadvantages of the labor contract duration system, and puts forward the idea that binary rules system should be applied in the liquidated damages system of labor contract. The binary rules system is applicable for both employers and employees. In a labor dispute, if the employees should bear the liquidated damages, "Labor Contract Law", which embodies the idea of social law, would be applied. In order to protect the employees, the liquidated damages should be used for compensation only, and should be used in cases stipulated definitely in law, and should be limited in amount. On the other hand, if the employers should bear the liquidated damages, "Contract Law", which embodies the idea of private law, would be applied. Employers would be treated as a party in a regular civil contract. The liquidated damages would be used for compensation or punishment, and would be used as long as the two parties have reached an agreement, and the amount is not limited. On the base of the binary rules system, the author puts forward a number of suggestions, with a view to improve the liquidated damages system of labor contract.