As we all know, the period of medical treatment has always been the hardest hit area for enterprise’s employment management. Especially when dealing with labor relation issues in such period, it is even more difficult for an HR.

The article 42 of Labor Contract Law stipulates that:” An employer shall not dissolve the labor contract under Articles 40 and 41 of this Law if any of its employee under one of the following circumstances: (3). has contracted an illness or sustained a non-work-related injury, and the prescribed period of medical treatment has not expired;”

I believe that readers who are familiar with the labor law have the same understanding of the above provisions as I do: except for the dismissal of disciplinary action and the termination through negotiation, the employer shall not unilaterally terminate the labor contract of the employee during the period of medical treatment.

As usual, here is a case background for appetizer:

Chen joined a software development company in Guangzhou in May, 2005, working as a game developer for nearly 14 years. Due to the high-intensity work of a programmer, Chen finally became bald in March, 2018 and was diagnosed afterwards in April with depression that demanded a leave of absence for two months. Tragically, the company decided to cancel the game development business in May and dissolve the department due to its perennial losses. Most of the employees in this department were transferred to other departments such as software or website development, while those who were not transferred terminated their labor contracts with the company. (Note that in practice, there may be cases where programmers in different development departments are of the same job type. In order to avoid the example errors, in this case, we preset the programmers of different development departments belong to different job type. Sorry, no rebuttal allowed here. )

In June, 2018, Chen returned to the company after his sick leave. Out of his love for game development, he refused to be transferred to other departments and claimed that he suffered from depression in the process of negotiation. In the following six months, Chen intermittently applied for sick leave by providing the medical proof  of depression, gallbladder polyp, arthropathy and doctor’s advice. Until 12^th December, Chen had not applied for sick leave anymore, and the company once again proposed to adjust his position to other departments. Chen refused and declared, “I am in the period of medical treatment, company need to take care of me.” On 14^th December, after consulting the trade union, the company terminated Chen’s labor contract in accordance with the provisions of Article 40, paragraph 3 of the Labor Contract Law. Chen applied for sick leave again on 15^th December, and filed a labor arbitration on the 16th, requesting the adjudication of company illegally terminating the labor contract and requesting to continue to perform his labor contract. 

[Choose the answer which you believe it is correct]

A:[Legal] Chen did not apply for sick leave on 14^th December, 2018. He is not an employee who is in a medical treatment period. At this time, due to the dissolution of Chen’s department, the original labor contract was objectively unable to continue to perform. The company did not manage to reach an agreement on changing labor contract with Chen, it is legal then to terminate the labor contract unilaterally. (N+1)

B: [Illegal] Chen has a working life of 14 years. He therefore is entitled to accumulated 12-month sick leave within medical treatment period of 18 months (according to law, different working lives are entitled to different periods). It is well known, depression is difficult to cure in short term, with intermittent and repeated characteristics. Although Chen did not apply for sick leave from 12^th to 14^th December, 2018, he did not actually recover and applied for sick leave again on the 15th, which was legally within the medical period. The decision of company to terminate unilaterally is illegal (2N or continue to perform the labor contract). 

PW & Partners’ Opinion

Apparently, the focus of this dispute is whether Chen was in the “prescribed medical period” when the company terminated his labor contract. PW & Partners believe that from 12th to 14th December, 2018, Chen did not apply for sick leave and returned to work, which should not be considered as within the “prescribed medical period”. The decision of company to terminate labor contract is legal.

First of all, the view of the option "B. illegal dismissal" is: from the date of Chen’s illness, he had started his medical treatment period of up to 18 months. He should be staying in the prescribed medical period, unless one of the following conditions appears:

1. Recover from illness

2. The duration of accumulated sick leave has been up to 12 months 

This view is a kind of expanded interpretation of the prescribed period of medical treatment. Article 2 of Provision of Medical Treatment Period Enjoyed by Employees for Illness or Non-Work-Related Injury issued by the former Ministry of Labor stipulated that “medical treatment period refers to the time limit when an employee stops working and rests due to illness or non-work-related injury, the employer cannot terminate the labor contract with this employee.”

[Here’s the point!] It can be seen that the medical treatment period demands  the following essential prerequisites:

1. Illness or non-work-related injury

2. Stop working to cure and take a rest [The crucial point!]

Back to the case: Chen is entitled to 12-month sick leave within medical treatment period of 18 months from the date of illness. “18 months” means “the period during which the medical treatment period can be filed”, “accumulated 12-month sick leave” means “the upper limit of the medical treatment period”. Therefore, only when it is in the prescribed “period” and the sick leave does not exceed the “upper limit” can sick leave mean “medical treatment period” legally. In this case, from 12th to 14th December, 2018, Chen did not apply for sick leave and returned to work, which should not be considered as within the “prescribed medical period”. The decision of the company to terminate his labor contract is legal. 

[Epilogue] This issue is mainly to share a point that is likely to be ignored or misunderstood in practice. Any further thoughts or comments are welcome! [It is the longest article ever, many thanks to the translator.]