Criticism of the newly implemented Labor Contract Law, especially open-ended contracts, is a result of misunderstanding, a senior legislator said on Tuesday.

"An open-ended labor contract is not an iron rice bowl," Xin Chunying, deputy director of the legislative affairs commission of the NPC Standing Committee, said.

"People can still be dismissed at any time if an employer has grounds to do so under the law," she said in a group interview.

"No one in government or legislature wants to reintroduce the iron rice bowl system."

Xin was referring to the former cradle-to-grave system of employment - the norm for urban workers under China's planned economy.

Many people are worrying that the Labor Contract Law, which requires firms to award open-ended contracts to staff with 10 years or more service, and those who have completed two fixed-term contracts, is an attempt to reintroduce the iron rice bowl system.

But Xin said those who have criticized the stipulation should take a closer look at the law.

It clearly states that employers can terminate open-ended contracts under at least 14 circumstances, including employees seriously violating company rules or regulations, or being incapable of doing their job, even after training.

It also allows employers to end contracts if they suffer serious economic problems or experience unforeseen circumstances that effectively invalidate the contracts they have with employees.

Xin said the new rule does not go against the concept of the market economy and will not lead to rigidity in the labor market.

"In many developed countries with established market economies, open-ended contracts are the norm," she said.

"It will help maintain a stable and balanced relationship between employers and employees."

In response to some voices the new law overprotects employees, Xin said it is natural that social laws, such as the Labor Contract Law, protect the rights of the weak.

"Labor laws in almost all countries in the world more or less reflect the will of the government (to protect the weak)," she said.

"And it's now time for us to share some of the economic growth achievements with the general public."

Zhang Shicheng, a legislator with the NPC Standing Committee's legislative affairs commission, said the new law needs to be fully implemented rather than amended at this stage.

"The law has been criticized just because it moves the cheese of the employers," he said.

"Strong employers and weak employees is still the most common state of affairs in the country."

(China Daily March 12, 2008)