Legal Research Of The Labor Service Contribution

Labor service plays a vital role in creating wealth for enterprises, especially for science and technology intensive businesses in the age that knowledge economy is developing rapidly. The issue of how to motivate employees and enhance enterprise Cohesiveness attracts much attention. Turning employees into company shareholders is the best motivation mode, which entitles employees rights accordingly under the premise of undertaking obligations and responsibilities. Labor service contribution means that investors invest in the company in form of labor service and obtain shareholders' qualification, stock ownership and profits.The pursuit of profits is the nature of companies, while labor service contribution helps the accomplishment of labor capital management and the optimization of administrative structure under the conception that efficiency is given precedence. In practice, the problems of performance shares, the joint stock cooperative system and esop(employee stock ownership plan) indicate employees'requirement for stock right and also the necessity of labor service contribution system. Therefore, the issues of its feasibility and how to apply it to practice effectively must be addressed properly in the first place.The current Company Law regulates methods of investment using examples and generalizations. Besides, it also prescribes two abstract standards "can be appraised by currency" and "can be transferred by law" as requirements for non-currency investment, which replaces previous inflexible regulations and brings new development for labor service contribution. However, as a new method of investment, it has its unique characteristics regarding the assessment and fulfillment of investment,the exercise of equity, the responsibility mechanism and the disputes settlement mechanism, which require specific systems accordingly in practice, for example: making the labor service contribution shareholders independent, integrating assessments from outside organizations and shareholders, assessing its responsibilities in terms of both formal and practical criterion separately, labor service contribution's voting trust system and shareholders' investment responsibilities etc. In other words, the labor service contribution system can exert its advantages and avoid its drawbacks so as to meet the internal demand of economic development.Therefore, the author suggests that legislators should consider legislating labor service contribution and revising the restricted regulations in Corporation Registration Management Rules, then the renovations in system can be in conjunction with the economic progress.