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Overview
A human resources service company and a related HR service entity faced a labour dispute brought by an employee who had suffered a work-related injury and was later assessed as having a Grade 9 disability.
The employee claimed that the employment relationship had been unlawfully terminated and sought compensation for alleged wrongful termination, unpaid wages, statutory work injury benefits, and an employment separation certificate.
The dispute involved an important question frequently encountered in China employment litigation: where an employee has formally submitted a resignation, can the employee subsequently claim that the employer unlawfully terminated the employment relationship?
Representing the companies, Yu Yuting, Attorney at NEO-ARK Law Firm, focused on the circumstances of the employee's departure, the distinction between termination and voluntary resignation, and the allocation of statutory work injury liabilities between the companies involved.
The court ultimately found that the employee had resigned for personal reasons rather than being unlawfully dismissed. The employee's claims for wrongful termination compensation and subsequent wages were therefore rejected.
Case Snapshot
| Item | Details |
|---|---|
| Practice Area | Employment & Labour Law |
| Case Type | Employment and Work Injury Dispute |
| Jurisdiction | Shenzhen, China |
| Client | Human Resources Service Companies |
| Core Issues | Voluntary Resignation, Wrongful Termination, Work Injury Benefits, Employer Liability |
| Dispute Value | Approximately RMB 90,000 |
| Court | Shenzhen Longgang District People's Court |
| Key Outcome | Wrongful Termination and Subsequent Wage Claims Rejected |
| Lead Lawyer | Yu Yuting / Sun Jianhui |
| Law Firm | NEO-ARK Law Firm |
Client's Situation
1. Employment and Work Injury
The employee joined a Shenzhen human resources service company in May 2021 as a sales employee and entered into a written employment contract.
In July 2021, the employee was injured in a traffic accident while commuting to work.
The Shenzhen Human Resources and Social Security Bureau subsequently recognised the injury as a work-related injury. A labour capacity assessment later determined that the employee had a Grade 9 disability.
2. The Employee Subsequently Resigned
In January 2022, the employee signed a resignation application and stated that the resignation was for personal reasons.
The employee later took the position that the employer had unlawfully terminated the employment relationship.
This created a central factual and legal issue: whether the employment relationship ended through the employee's voluntary resignation or through an employer-initiated termination.
Legal Strategy
| Legal Issue | Legal Strategy |
|---|---|
| Nature of employment termination | Establish that the employee voluntarily resigned rather than being dismissed |
| Wrongful termination compensation | Challenge the legal basis for treating the resignation as an unlawful employer termination |
| Subsequent wage claim | Establish that wages could not be claimed on the basis of an employment relationship that had already ended through resignation |
| Work injury benefits | Distinguish different statutory work injury benefits and their respective payment mechanisms |
| Liability between companies | Clarify the respective legal responsibilities of A Company and B Company |
| Medical benefit | Distinguish the benefit subject to the social insurance procedure from claims properly determined in the employment litigation |
Outcome
The Shenzhen Longgang District People's Court confirmed that the employee had voluntarily resigned for personal reasons.
As a result, the court rejected the employee's claims for:
- Compensation for alleged wrongful termination;
- The claimed subsequent wages.
The court also determined that the one-off disability employment benefit was payable by B Company, with A Company bearing joint and several liability.
The claim for the one-off work injury medical benefit was not dealt with as a direct payment obligation in the case because it was subject to the applicable social insurance procedure.
Overall, the court's decision substantially limited the companies' exposure by rejecting the employee's principal claims concerning alleged unlawful termination and subsequent wages.
Why This Case Matters
Work injury disputes can become significantly more complicated when an employee later challenges the circumstances in which the employment relationship ended.
For employers and human resources service companies, it is important to distinguish between:
- A genuine employer-initiated termination;
- A voluntary resignation by the employee;
- Statutory work injury benefits;
- Benefits processed through social insurance;
- Liabilities arising between multiple companies involved in the employment arrangement.
This case illustrates that a recognised work injury does not, by itself, establish that an employer unlawfully terminated the employment relationship.
The circumstances and documentation surrounding the employee's departure remain critical to determining the nature of the termination and the resulting legal liabilities.
Frequently Asked Questions
Can an employee claim wrongful termination after submitting a resignation?
Not automatically.
If the court determines that the employee voluntarily resigned rather than being dismissed by the employer, a claim for statutory compensation for unlawful termination may not be supported.
Does a work injury automatically make an employer liable for wrongful termination?
No.
Work injury liability and termination liability are separate legal issues. The existence of a work injury does not by itself establish that the employer unlawfully terminated the employment relationship.
Can different companies be responsible for different work injury benefits?
Yes.
Where multiple companies are involved, the applicable employment relationship, work injury insurance arrangements and statutory responsibilities must be examined to determine which entity bears each obligation.
How should employers handle a resignation after a work injury?
Employers should carefully document the employee's resignation, the stated reason for departure, relevant employment records, and the handling of statutory work injury benefits.
The legal consequences depend on the specific circumstances and applicable law.
Key Takeaways
- A voluntary resignation can be decisive when defending a subsequent wrongful termination claim.
- Work injury status and unlawful termination are separate legal questions.
- Different work injury benefits may have different responsible parties and payment procedures.
- HR service companies should carefully document employee departures and work injury arrangements.
- Where multiple companies are involved, liability should be analysed separately rather than assumed to be joint.
About the Author
Yu Yuting
Partner | NEO-ARK Law Firm
Lawyer Yu focuses on foreign-related litigation, cross-border disputes, commercial matters, and legal services for overseas individuals and businesses in China.
Email: [email protected]
About NEO-ARK Law Firm
NEO-ARK Law Firm provides legal services in foreign-related litigation, commercial disputes, family law, and cross-border legal matters, assisting both international and domestic clients throughout China.
