China's New Workplace Safety Law Takes Effect

China’s revised Workplace Safety Law, which imposes significantly harsher penalties on offenders, took effect Dec. 1, 2014.

Companies involved in serious workplace accidents will be fined up to 20 million yuan ($3.25 million U.S.), and managers found to have failed in their duty to ensure safety will be levied fines between 30 percent and 80 percent of their annual income, under the new law.

The penalty cap is a significant increase from the previous statute, under which managers faced fines between 20,000-200,000 yuan and companies no more than 100,000 yuan.

The new law also calls for managers responsible for “serious” and “extremely serious” accidents to be banned from comparable positions within the same industry.

Serious accidents are defined as those causing 10 to 30 deaths, 50 to 100 serious injuries, or direct economic losses of between 50 and 100 million yuan.

Extremely serious accidents are those that cause the deaths of more than 30 people, seriously injure 100 or more people, or result in over 100 million yuan in direct economic losses.

“The Workplace Safety Law, which took effect in 2002, has helped reduce malpractice, but many problems still need to be addressed,” said Yang Dongliang, director of the State Administration of Work Safety, in a statement. Specifically, government regulations and standards are not being properly implemented at the local level, he said.

The administration investigated 44 serious workplace accidents and prosecuted about 300 people for violating workplace safety laws in 2013. Light punishment and lack of supervision are believed to be among the major reasons for the negligence behind frequent accidents, according to the agency.

The new law also enhances the supervisory power of occupational safety watchdogs and local governments, especially those at township level. Most of China’s occupational accidents occur at small businesses in rural areas, according to the agency.

Additional reforms include:

• Increased fines for failing to provide safety training for employees and not abating hazards after being notified of them.
• Allowing government regulators to blacklist large companies that may not be deterred by fines.
• Allowing regulators to force factories to suspend operation by cutting off their power supply, if their workplace is considered highly unsafe and likely to cause accidents.

Roy Maurer is an online editor/manager for SHRM.

Follow him at @SHRMRoy

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