Two rules concerning the adoption of employment contracts in public institutions, including hospitals, schools and the media in the city, and handling contract disputes by arbitration, became effective on January 10.

Under the planned economy, non-profit institutions did not hire workers. Instead, they received graduates allocated by the government, and employees normally stayed in one place until retirement. They held a job for life and earned the same salary as their peers, based on "share and slave" concept.

It was not until 1995 that Shanghai began to spread the "hiring system" among non-profit public institutions, based on "temporary rules." In 1999, public institutions were permitted to set different salaries in line with an employee's performance.

"The current hiring and salary system stimulates employees' enthusiasm for work, and boosts the development of those institutions," said Ding Zhenwen, deputy director of the bureau's rules and regulations department.

The new rules added more detailed information.

For instance, they stipulate that if an employee doesn't get approval from the employer before quitting a job, he or she has to wait for another six months before leaving, instead of the previous one month.

The new rules also stress the importance of annual assessment of employee's performance, which is demanded as a key reference for promotion, demotion or dismissal.

Those employees who fail the assessment could be reassigned or dismissed.

(eastday.com March 7, 2003)