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China Law Insight

Labor & Employment

How change of address affects employment relationship

Posted in Labor & Employment

By Xu Xiaodan and Qi Yiduo King & Wood Mallesons’ Commercial & Regulatory Group

Ixu_xiaodann a case in Guangdong Province, the Employee and the Company concluded a written employment contract on July 1, 2012, and agreed that the work location of the Employee is Guangdong Province. The first part of the contract reads “the domicile of the Company is: Second Floor, Building B, Chengnaner Road No.12, South District, Zhongshan”. On May 13, 2013, the Company posted a notice and notified the employees that it decided to change its registered place to “Third Floor, East Road No.2, East Town, Huoju Development Zone, Zhongshan” and the employees should work at the new address. On September 25, 2013, the Company officially changed its registered address upon the approval of the industrial and commercial administration department. However, the new address was far away from the residence of the Employee and that caused significant inconvenience to the Employee. The Employee considered relocation of the Company a change of his employment contract thus the Company should have obtained his consent. If the Company did not obtain his consent after consultation, the circumstance constituted “a significant change of the objective circumstances relied upon at the time of conclusion of the employment contract so that the employment contract could no longer be performed and the parties cannot reach an agreement on amending the employment contract”, so the Company should make severance payment to him.

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