New govt rule impacting dynamics between ride-hailing platforms and drivers

DiDi et al. asked to take better care of workers

Before DiDi yesterday morning announced delisting from the New York Stock Exchange and preparation of listing on the Hong Kong Stock Exchange, eight Chinese ministries led by the Ministry of Transportation published on Tuesday, November 30 关于加强交通运输新业态从业人员权益保障工作的意见 Opinions on Strengthening the Protection of the Rights and Interests of Workers in New Forms of Transportation Business.

It’s not that the two events are related, but that the ride-hailing sector is certainly in the news - and the government regulation may have a longer impact on the entire sector, which is why this newsletter features a translation of the regulation and some brief observations. And this will be somewhat similar to the Guidelines on protecting the rights and interests of workers in new forms of employment, which Pekingnology published on August 23.

Before we go, it’s pretty clear that the Chinese authorities intend to promote the rights and interests of drivers in the Uber-like business. Whether drivers for Uber and DiDi shall be treated as formal employees or independent contractors is a question that decision-makers from California to China are grappling with.

What to call them is the first thing that caught your Pekingnologist’s attention: the Chinese word here is 从业人员, basically the people engaged in the profession which this newsletter puts as workers for the sake of brevity, rather than the traditional word 职工 employees which would denote a sense of the traditional employment.

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关于加强交通运输新业态从业人员权益保障工作的意见

Opinions on Strengthening the Protection of the Rights and Interests of Workers in New Forms of Transportation Business

为深入贯彻落实党中央、国务院决策部署，加强交通运输新业态从业人员权益保障工作，推动交通运输新业态规范健康持续高质量发展，更好服务广大人民群众，提出如下意见。
To implement the decisions and plans made by the Central Committee of the CPC and the State Council, better protect the rights and interests of workers engaged in new forms of the transportation business, promote the standardized, healthy, sustained, and high-quality development of new forms of the transportation business, and serve the people, the opinions hereunder are put forward.

总体要求
General requirements

以习近平新时代中国特色社会主义思想为指导，全面贯彻党的十九大和十九届二中、三中、四中、五中、六中全会精神，坚持稳中求进工作总基调，立足新发展阶段，完整、准确、全面贯彻新发展理念，服务构建新发展格局，坚持以人民为中心的发展思想，坚持系统观念，统筹发展和安全，紧紧围绕解决交通运输新业态从业人员最关心最直接最现实的权益保障问题，注重标本兼治，完善治理体系，着力规范交通运输新业态企业经营行为，维护公平竞争市场秩序，健全完善从业人员权益保障制度，营造良好从业就业环境，全力维护从业人员合法权益，促进交通运输新业态规范健康持续高质量发展。
Guided by the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, efforts should be made to fully implement the guiding principles of the 19th National Party Congress and the second, third, fourth, fifth and sixth plenary sessions of the 19th Central Committee, follow the general principle of pursuing progress while ensuring stability, ground our work in this new stage of development, apply the new development philosophy accurately and comprehensively, foster a new pattern of development, follow a people-centered development philosophy, apply systems thinking, and place equal emphasis on development and security.

Focusing on the most pressing and most immediate issues that concern the rights and interests of workers in new forms of transport business, we address both the symptoms and root causes, improve the governance system, put effort into regulating the operations of enterprises in new forms of transport business, maintain the market order for fair competition, establish a sound system for protecting the rights and interests of workers, create an environment conducive to the profession, protect legitimate rights and interests of workers, and promote the standardized, healthy, sustainable, and quality development of new forms of the transportation business.

主要任务
Main tasks  

完善平台和从业人员利益分配机制。各地相关部门要督促网络预约出租汽车（以下简称网约车）平台企业向驾驶员和乘客等相关方公告计价规则、收入分配规则，每次订单完成后，在驾驶员端应同时列明订单的乘客支付总金额、驾驶员劳动报酬，并显示乘客支付总金额减去驾驶员劳动报酬后与乘客支付总金额的比例（俗称“抽成”），保障驾驶员知情权和监督权。
Improve the mechanism for income distribution for platforms and workers. Relevant local government departments should urge and supervise online ride-hailing service (hereinafter referred to as online ride-hailing) platform companies to make rules of pricing and income distribution public to drivers, passengers, and other related parties.

After each order is fulfilled, the driver’s side (of the ride-hailing platform app) should display simultaneously the total amount paid by the passenger, the driver’s remuneration (from the order), and the ratio of their difference divided by the total amount paid by the passenger (commonly known as “commission rate”) in order to protect the driver’s right to know and oversee.

Note: From experience on the ground in China, the ride-hailing driver doesn’t typically know how much the passenger paid after the end of the ride. So this new rule, written in an excruciatingly detailed fashion, should force a change and increase transparency.

督促网约车平台企业加强与经营服务所在地工会组织、行业协会的沟通协商，合理设定抽成比例上限并在移动客户端和媒体上公开发布。督促网约车平台企业在确定和调整计价规则、收入分配规则等经营策略前，公开征求从业人员代表及工会组织、行业协会的意见，并提前一个月向社会公布。

We should urge and supervise online ride-hailing platform companies to strengthen communication with local trade union organizations and industry associations, set a reasonable upper limit on the commission rate and publish them on mobile apps and the media. We should urge and supervise online ride-hailing platform companies to publicly solicit the opinions of workers’ representatives, trade unions, and industry associations before determining and adjusting business strategy such as pricing rules and income distribution rules, and make them public to society one month in advance.

支持从业人员参加社会保险。完善社会保险经办服务，提高交通运输新业态从业人员参保和享受待遇的服务便捷性。强化网约车驾驶员职业伤害保障，鼓励网约车平台企业积极参加职业伤害保障试点，为网约车驾驶员在线服务期间劳动安全提供保障。督促网约车平台企业依法为符合劳动关系情形的网约车驾驶员参加社会保险，引导和支持不完全符合确立劳动关系情形的网约车驾驶员参加相应的社会保险。
We should support workers in taking part in social security. We will improve the work of social security agencies so that workers engaged in new forms of the transportation business enjoy convenience and accessibility to take part in social security and enjoy the benefits. We should strengthen the protection of online ride-hailing drivers against occupational injuries, encourage online ride-hailing platform companies to participate in pilot programs for protection against occupational injury, to ensure the work safety of online ride-hailing drivers during the service period. We should urge and supervise online ride-hailing platform companies to arrange social security for online ride-hailing drivers with whom their relationship fits employment according to law, and guide and support online ride-hailing drivers whose relationship with the platform companies do not fit employment take part in appropriate social security schemes.

Note:

1) This is not a book about China’s social security system but basically, some of the drivers would meet the threshold which effectively enables them to subscribe to social security schemes open to full employees, and some - obviously a larger share - wouldn’t and the government here is trying to facilitate their enrollment into some other schemes that provide less - but still some - benefits. The platform companies will have to contribute their share, per the requirement of the different schemes.

2) The pilot programs for protection against occupational injury, according to Xinhua in Chinese,

我国将在部分重点行业开展灵活就业人员职业伤害保障试点，探索用工企业购买商业保险、保险公司适当让利、政府加大支持的机制，为外卖员、快递员、网约车司机等提供与工伤保险待遇接近的保障。

is likely an insurance-like scheme where platform companies, insurance companies, and the government pool some money together to compensate for these flexible drivers’ injuries from work.

3) Note the mandatory public disclosure for a lot of information that would usually be considered sensitive to a business. And a sort of collective bargaining is required of the local chapters of All-China Federation of Trade Unions to balance with the management.

保障从业人员合理劳动报酬。相关行业主管部门、工会组织、行业协会等要持续关注行业运行情况及网约车驾驶员劳动报酬水平，并适时公开发布，引导驾驶员形成合理收入预期。各级工会组织要根据工作性质、劳动强度、工作任务、当地职工平均工资、市场经营状况等因素，与网约车平台企业、行业协会协商确定驾驶员劳动报酬计算规则和标准并向社会公布。督促网约车平台企业向提供正常劳动的网约车驾驶员支付不低于当地最低工资标准的劳动报酬。
Ensure fair work remuneration for workers. Competent administrative departments, trade unions, industry associations, etc. should keep abreast of the industry operations and the level of work remuneration for online ride-hailing drivers, and publish them at appropriate times to guide drivers to have reasonable expectations for income. Trade union organizations at all levels should discuss with online ride-hailing platform companies and industry associations to determine rules and standards for the calculation of drivers’ work remuneration based on the nature of work, labor intensity, tasks, loca average wages, operating conditions of the market, etc., and make them public to society. We will urge and supervise online ride-hailing platform companies to pay work remuneration not lower than the local minimum wage standard to online ride-hailing drivers who work in a regular fashion.

Note:

1) Translation of the last sentence is a bit tricky. Basically, the local minimum wage applies to drivers who work in a fashion that can be compared to a formal employee.

2) Again: note the mandatory public disclosure for a lot of information that would usually be considered sensitive to a business, and a sort of collective bargaining is required, mandating the local chapters of the All-China Federation of Trade Unions to balance with the management.

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保障从业人员获得合理休息。各地相关部门要督促网约车平台企业科学确定驾驶员工作时长和劳动强度，保障其有足够休息时间。督促网约车平台企业持续优化派单机制，提高车辆在线服务期间的运营效率，不得以冲单奖励等方式引诱驾驶员超时劳动。
Ensure reasonable arrangements for workers’ resting. Relevant government departments in all regions should urge and supervise online ride-hailing platform companies to scientifically determine the length of working hours and labor intensity of drivers, ensuring that drivers have sufficient time for rest. We should urge and supervise online ride-hailing platform companies to optimize the mechanism for allocating orders to improve the operational efficiency of vehicles during their in-service time, and it is not allowed to tempt drivers to work overtime through rewards for extra orders and so on.

Note: The experience on the ground is, at least in the early years, the platforms reward drivers for finishing many orders, and the rewards rose as they finish increasingly more. For example, one gets an extra 10 yuan for finishing 10 orders, but probably an extra 30 yuan for finishing 20 orders.

改善从业环境和工作条件。各地相关部门要优化审批流程，为符合准入条件的网约车平台企业、车辆和驾驶员办理许可提供便利。积极推进出租汽车综合服务区建设，在医院、居民集中居住区、重要商业区、综合交通枢纽等场所设置出租汽车临时停靠点，允许巡游出租汽车和网约车临时停靠，破解出租汽车驾驶员“就餐难、停车难、如厕难”等问题。督促网约车平台企业加强对从业人员职业技能、劳动安全、运营服务的教育培训；加强对用工合作单位的管理，不得以高额风险抵押金、保证金转嫁经营风险，不得将驾驶员服务计分与服务时长、派单机制等挂钩，不得变相违法阻碍驾驶员自由选择服务平台。
Improve the work environment and working conditions. Relevant government departments in all regions should optimize the approval process for the convienence of online ride-hailing platform enterprises, vehicles and drivers who meet the qualifications to access the market. Efforts should be made to establish comprehensive service areas for taxis and their ride-hailing peers, and temporary parking areas in hospitals, heavily residential areas, important commercial districts, comprehensive transport hubs, etc. Cruising taxis and online ride-hailing vehicles will be allowed to park temporarily for dining, parking, going to the toilet, etc.

We will urge and supervise online ride-hailing platform companies to step up the education and training for workers regarding vocational skills, labor safety, and services, and tighten the management of contractors. It is forbidden (for platform companies) to use high-value deposits or cash deposits to shift operational risks (to drivers). It is forbidden to link the assessment of drivers’ services to their servie hours, order allocation mechanism, etc. It’s forbidden to illegally obstruct the drivers’ free choice of platforms, or do so in a disguised manner.

Note: The last sentence brings to mind the SAMR’s anti-monopoly penalty against the practice of “Choose One from Two”. Chinese government rules appear to continuously emphasize that big platforms - whatever sector they are in - shall not use anti-competitive measures against the small guys’ freedom of choice in whom they do business with.

加强对从业人员的人文关怀。各地相关部门要密切关注交通运输新业态从业人员在工作、生活中遇到的困难和问题，广泛开展多种形式的送温暖等关心关爱驾驶员活动。鼓励交通运输新业态企业加强对从业人员的人文关怀，建立优秀从业人员奖励制度，提升从业人员行业归属感和职业荣誉感。
Provide better care for workers. Relevant government departments in all regions should pay close attention to the difficulties and problems faced by workers engaged in the new forms of the transportation business in their work and life, and provide assistance to drivers in various forms accordingly. Companies in new forms of the transportation business will be encouraged to provide better compassionate care for workers, and establish a reward system for outstanding workers to raise their sense of belonging and professional honor.

促进网约车平台企业合规发展。各地交通运输主管部门要督促网约车平台企业严格遵守法规规定，不得接入未获得网约车许可的驾驶员和车辆。督促网约车平台企业在驾驶员和车辆新注册时，应要求提供网约车驾驶员和车辆许可证件，对无法提供的不予注册，并提醒依法依规办理相应许可。严厉打击非法营运行为，鼓励运用信息化手段加强精准执法。
Promote the development based on compliance of online ride-hailing platform companies. Transportation authorities in all regions should urge and supervise online ride-hailing platform companies to abide by laws and regulations and not engage drivers and vehicles that have not obtained the permit for online ride-hailing services. We should urge and supervise online ride-hailing platform companies to require the provision of the permits of the drivers and the vehicles when registering new drivers and vehicles. Those who are unable to provide permits shall not be registered, and shall be notified to apply for corresponding permits in accordance with laws and regulations. We should crack down on illegal operations and it is encouraged to apply information technology-based means to strengthen law enforcement in a targeted manner.

维护公平竞争市场秩序。加强对交通运输新业态企业的事前事中事后全链条监管，强化交通运输新业态运行监测，及时预警垄断风险，加大反垄断、反不正当竞争监管执法力度。防范资本在交通运输新业态领域无序扩张，依法严厉查处低价倾销、“大数据杀熟”、诱导欺诈等违法违规行为。落实交通运输新业态企业主体责任，引导企业自觉开展公平竞争，鼓励企业主动向社会作出公平竞争信用承诺。
Maintain the market order for fair competition. We will strengthen the supervision of enterprises engaged in new forms of the transportation business across the board, step up efforts to monitor the operation of the new forms of the transportation business, give early warning of monopoly risks, and intensify supervision and law enforcement to deter monopoly and unfair competition.

We will prevent the disorderly expansion of capital in the field of new forms of the transportation business, and investigate and punish illegal activities such as dumping, big data-based price discrimination, and fraud in accordance with the law.

We will ensure enterprises engaged in the new forms of the transportation business shoulder their responsibility, guide the enterprises to enter into fair competition on their own initiative, and encourage enterprises to proactively make public commitment on fair competition and credibility.

Note: Didi is still off the app stores in China, and its rivals have not rested in expansion in the months.

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畅通投诉举报渠道。充分发挥12328交通运输服务监督电话、12315消费维权电话作用，及时处理从业人员和社会公众对管理部门乱收费、乱罚款、违规执法等投诉举报，并及时向社会公开处理情况，确保件件能解决、事事有回音。督促交通运输新业态企业建立首问负责制，及时受理并妥善处理从业人员和消费者投诉，不得敷衍推诿，切实保障从业人员和消费者合法权益。
We should ensure channels for complaints and whistleblowing. We should bring into full play the role of the supervision hotline 12328 for transportation service and hotline 12315 for the protection of consumer rights, handle complaints and whistleblowing cases, in a timely manner, from the workers and the general public regarding arbitrary charges, arbitrary fines, illicit law enforcement, etc. by the administrative departments, and make public the results of the handling of every compliant and case in a timely fashion.

We will urge and supervise enterprises engaged in the new forms of the transportation business to not pass the buck on complaints made by workers and consumers and accept and handle them on time, in an effort to safeguard the legitimate rights and interests of the workers and consumers.

强化工会组织保障作用。各地工会组织要将网约车驾驶员作为推动建会入会的重点群体，进一步拓宽入会渠道，最大限度吸收交通运输新业态从业人员加入工会组织，搭建从业人员与新业态企业交流沟通平台，探索建立从业人员与新业态企业平等协商机制。
Strengthen the supporting role of trade union organizations. Trade union organizations in all regions should regard online ride-hailing drivers as a key group for promoting the establishment of and admission to trade union organizations, open up the channels for joining the trade unions, admit the workers engaged in new forms of the transportation business to the trade unions to the greatest extent, build a platform of communication between the workers and the enterprises engaged in new business forms, and explore the establishment of a consultative mechanism on an equal basis between them.

保障措施
Supporting measures

完善协同联动机制。充分发挥交通运输新业态协同监管部际联席会议机制作用，进一步加强政策衔接和协同配合，及时协调解决交通运输新业态从业人员权益保障工作中遇到的各类问题。各地要参照交通运输新业态协同监管部际联席会议机制，于2021年底前在省级和地市级层面建立或完善多部门协同监管联席会议机制。
Improve the coordination mechanism. We will give full play to the role of the inter-ministerial joint meeting mechanism for coordination and supervision of new forms of the transportation business, promote the articulation and coordination of policies, and coordinate and solve the problems relating to the protection of the rights and interests of workers engaged in new forms of the transportation business in a timely fashion. Local authorities should establish or improve the joint meeting mechanism for multi-departmental coordination and supervision at the provincial and prefecture levels before the end of 2021, regarding the inter-ministerial joint meeting mechanism for coordination and supervision of new forms of the transportation business.

According to a 2018 notice from the General Office of the State Council, the inter-ministerial joint meeting mechanism for coordination and supervision of new forms of the transportation business involves 11 central ministry-level organs, with the Ministry of Transporation playing the leading role.

压实各方责任。各地要切实履行交通运输新业态从业人员权益保障属地管理责任，加强统筹协调，细化任务措施，抓好工作落实。压紧压实交通运输新业态企业在从业人员权益保障方面的主体责任，对交通运输新业态企业直接管理和由用工合作单位组织用工的各类从业人员，由交通运输新业态企业依法依规承担从业人员权益保障主体责任。督促交通运输新业态企业明确告知从业人员有关权利和义务及劳动保障相关法律政策，并为其落实提供便利，符合确立劳动关系情形的，应依法签订劳动合同。
Ensure that all parties fulfill responsibilities. Local authorities should earnestly fulfill the responsibility of protecting the rights and interests of workers engaged in new forms of the transportation business in places within their jurisdiction, strengthen holistic planning and coordination, release detailed tasks and measures, and ensure implementation.

We will work to ensure that enterprises engaged in the new forms of the transportation business fulfill the primary responsibility of protecting the rights and interests of workers. For the various types of workers who are directly managed by enterprises engaged in the new forms of the transportation business and organized by the cooperative parties, the enterprises engaged in the new forms of the transportation business should fulfill the primary responsibility of protecting their rights and interests of following laws and regulations.

We will urge and supervise enterprises engaged in new forms of the transportation business to expressly inform workers of the relevant rights and obligations as well as laws and policies relating to labor security, and facilitate their implementation. Labor contracts should be signed in accordance with the law if the employer establishes labor relations with the worker.

加强宣传引导。加强政策宣传解读，加大对交通运输新业态企业积极履行社会责任、关心关爱从业人员及从业人员先进事迹等正面信息的宣传力度。组织开展“最美出租汽车司机”宣传活动，讲好典型故事，弘扬行业正能量。

We should strengthen publicity and guidance. We should step up efforts to publicize and interpret policy, and increase the publicity of positive news such as the enterprises fulfilling their social responsibility, providing care for workers, and exemplary deeds by workers. We will organize the publicity event of “model taxi/(ride-hailing) driver”, tell typical stories well and build up positive energy in the industry.

Lastly, you are invited to read the Aug. 23 Pekingnology newsletter translating and explaining the 关于维护新就业形态劳动者劳动保障权益的指导意见 Guidelines on protecting the rights and interests of workers in new forms of employment, which covers more sectors.