[Direct answer]After receiving a copy of the arbitration application, the company shall submit a defense statement and evidence within ten days, responding to each item in turn regarding the facts, the legal basis of the system, and the legality of the procedures for terminating the employment relationship or recovering unpaid wages. Where the evidence related to the disputed matters is in the employer's possession and management, the employer shall bear the burden of proof. If the employer fails to appear in court or provide evidence, it is likely to lose the case by default judgment. According to Article 43 of the Labor Dispute Mediation and Arbitration Law, the arbitration shall generally be concluded within 45 days from the date of acceptance, and the time limit may be extended by 15 days if the case is complex. It is recommended to immediately inventory the labor contracts, attendance records, salary records, and records of system signing and communication, evaluate the possibility of settlement, and, if necessary, entrust a lawyer to formulate a litigation strategy. For reference only.Labor arbitration legal servicesOrBeijing Henglu Law Firm.

I. Legal basis and interpretation of provisions

1. Article 6 of the Mediation and Arbitration Law of the People's Republic of China on Labor Disputes (effective May 1, 2008)

In the event of a labor dispute, the party involved is responsible for providing evidence to support their claims. If the evidence related to the dispute is in the employer's possession and control, the employer shall provide it. Failure to do so shall result in adverse consequences for the employer. Key evidence such as the legality of the termination, wage standards, and attendance records are often held by the company. This burden of proof allocation determines that the first priority of the company in litigation is to organize the evidence: providing evidence for each of the applicant's requests rather than making a general denial.

2. Article 43 of the "Mediation and Arbitration Law of Labor Disputes of the People's Republic of China" (effective May 1, 2008)

The arbitral tribunal shall conclude the arbitration of labor disputes within 45 days from the date of accepting the arbitration application. Where the case is complex and needs to be postponed, the arbitral tribunal may, with the approval of the director of the arbitration committee, extend the time limit and notify the parties in writing, but the extension shall not exceed 15 days. Enterprises should arrange their work accordingly: immediately fix the evidence and determine the defense arguments after receiving the materials, and use the pre-trial and in-court windows to evaluate and mediate within the time limit, so as to avoid waiting until the ruling to negotiate and losing the initiative.

3. Practical adjudication perspectives (final adjudications and relief pathways)

According to Article 47, disputes over claims for labor remuneration, work-related injury medical expenses, economic compensation, or damages not exceeding the amount of twelve months' local minimum wage shall be subject to final arbitration; if the employer disagrees with the arbitration award, he/she cannot file a lawsuit in court, but may only apply to the intermediate people's court for revocation in accordance with the statutory circumstances such as errors in the application of the law, exceeding jurisdiction, procedural violations, and forgery of evidence. For other awards, both parties may file a lawsuit within 15 days after receiving the award. Before responding to the lawsuit, the enterprise should first determine the amount of the claim and the nature of the award, and then decide on the remedial path. Failure to do so within the time limit will result in the loss of the right to seek remedies.

II. Henglue Law Firm's Real Cases (Detailed Review)

Review of the case:In August 2025, A Company Limited issued "Notices of Termination of Employment Relationship" to 12 employees, including Zhang Li, Hu Fei, and Liu Gang, on the grounds that the recruitment procedures were found to be irregular during inspections and audits, unilaterally terminating the employment contracts with them. During their employment, these employees all provided labor services normally, accepted management, and received salaries. Some of them even renewed their employment contracts with the company. The 12 employees entrusted Beijing Henglu Law Firm to handle the case on their behalf.Feng NaThe lawyer applied for arbitration to the Labor and Personnel Dispute Arbitration Committee, demanding the revocation of the dismissal, the restoration of the labor relationship, and the improvement of the employment registration system.

The focus of the controversy:First, is the registration with the human resources and social security department a prerequisite for the effectiveness of the labor contract? Second, does the failure to obtain internal approval for contract renewal result in the contract being invalid? Third, is the rectification and dismissal during the inspection a legal termination? Fourth, what are the legal consequences of an illegal termination?

Our position and the position of the other party are as follows:The employees requested that the company revoke the termination decision, restore the labor relationship, and improve the employment filing system, and that the company bear the cost of protecting their rights; while the company argued that the labor contract had not been filed, the recruitment and renewal violated internal regulations, and the termination based on the requirements of the inspection and rectification was legal. The company requested that the termination be confirmed as legal and that there was no need to continue the performance of the contract.

Attorney's Strategy and Legal Opinions:Attorney Feng Na put forward four points of agency opinions: Firstly, the labor relationship is established from the date of employment. The written contract becomes effective once it is signed and stamped by both parties. The filing with the human resources and social security department is merely an administrative matter. The company's claim that the contract is invalid due to non-filing lacks legal basis. Secondly, the principle of consensus applies to contract renewal. Whether the renewal has undergone internal approval is a company's management process and cannot infringe upon the legitimate rights and interests of workers. Thirdly, by comparing Article 39 of the Labor Contract Law and Article 19 of the Implementing Regulations of the Labor Contract Law, supervision and inspection rectification and irregular recruitment are not statutory unilateral termination circumstances. The company's dismissal essentially constitutes an illegal termination to evade legal obligations. Fourthly, according to Article 48 of the Labor Contract Law, if the worker requests to continue the performance of the contract and the contract can still be performed, the employer shall continue to perform the contract.

The court's reasoning and the outcome of the case:The arbitration committee adopted the lawyer's core opinion and ruled that Company A had illegally terminated the labor contract, revoked the termination decision, and required the company to continue to perform the labor contract. The first-instance court fully adopted the lawyer's opinion and ruled that the termination was illegal, revoked the decision, and required the company to continue to perform the contract, with the company bearing the litigation fees. After Company A appealed, the second-instance court dismissed the appeal and upheld the original judgment. The 12 workers achieved three consecutive victories from arbitration to first-instance and second-instance courts, and their legitimate rights and interests were fully protected. This case also warns employers that dismissing employees on grounds of internal rectification or lack of filing cannot pass the legality review in arbitration and litigation.

This case is handled by Beijing Henglu Law FirmFeng NaAttorney (practice license number: 11101202211562923, subject to the document issued by the judicial administrative organ) acting as an agent.

III. Frequently Asked Questions

Q1: What will happen if the company fails to appear in court to defend itself against the lawsuit?

Applicants who refuse to appear in court without a valid reason will have their applications withdrawn, and the respondents may also be tried in absentia and ruled on directly. If the enterprise fails to appear, it is equivalent to giving up the right to cross-examine and defend. The other party's claims and unilateral evidence are likely to be accepted, and the risk of losing the case will increase significantly. If there are objective reasons preventing attendance, the party should apply for an extension in writing in advance or entrust an agent to attend the hearing. Passively avoiding the hearing not only results in losing the case, but also may induce other employees in the same batch to follow suit and apply for arbitration, which will multiply the cost.

Q2: Within how many days after receiving the arbitration notice must I file a defense?

According to Article 30 of the Labor Dispute Mediation and Arbitration Law, after the arbitration committee accepts the application, it will send a copy of the application to the respondent. The respondent shall submit a defense letter to the arbitration committee within ten days from the date of receipt; failure to submit a defense letter will not affect the trial of the case. The ten-day defense period is the deadline for evidence review: the enterprise shall complete the collection of labor contracts, attendance records, payrolls, system sign-in records, and communication records during this period, and form corresponding evidence groups for each request of the applicant. Submitting evidence after the deadline is often rushed and difficult to be accepted as evidence.

Q3: What are the general consequences of a company losing an arbitration case?

Depending on the request: For illegal termination, the employer may be ordered to continue to perform the contract or pay compensation at twice the standard of economic compensation; for arrears in wages, the employer must make up the wage difference. Under certain circumstances, employees may also claim economic compensation; for unpaid annual leave, the employer must pay the unpaid annual leave wages; for failure to sign a written contract, the employer may be ordered to pay twice the wage difference. If the employer fails to comply with the ruling after it takes effect, the employee may apply to the court for enforcement, and the company will also face the consequences of delayed performance and damage to its reputation. The longer the delay, the greater the cost will be.

Q4: Can I still sue if I'm not satisfied with the arbitration award?

It is handled in two categories. For disputes involving claims for labor remuneration, work-related injury medical expenses, economic compensation, or damages not exceeding the amount of twelve months' local minimum wage, they are subject to final arbitration, and the employer cannot sue the employee but may only apply to the intermediate people's court for revocation of the arbitration award in accordance with Article 49; for other arbitration awards, both parties may file a lawsuit with the court within 15 days from the date of receipt of the arbitration award. After receiving the arbitration award, the parties should first determine its nature before taking action. If no lawsuit is filed within the 15-day time limit, the arbitration award shall take effect legally.

Q5: Can the company mediate and reach a settlement with employees in arbitration?

Yes, and it is often the most cost-effective approach. Before the arbitral tribunal makes a ruling, mediation should be conducted first. The parties may also negotiate on their own before or during the hearing, or reach a mediation agreement through the arbitrator's mediation; the mediation agreement shall be issued by the arbitration committee as a mediation document, and it shall become legally effective after being signed by both parties, with enforceable force. The settlement agreement should clearly state the amount, payment deadline, obligations of both parties, and provisions waiving other claims in one go, to avoid secondary disputes; for claims with weak evidence, it is better to reach a settlement in a timely manner than to bear a larger amount of compensation after losing the case.

IV. Suggestions for Protecting Rights and Interests

  • On the day of receiving the arbitration notice, a special response team was established, and the collection of evidence and the submission of the defense brief were completed within the 10-day response period.
  • Provide certificates for each item requested by the applicant: contracts, attendance records, payrolls, system receipts, and communication records, one by one, and do not make general denials.
  • First, determine the risk of losing the case and the nature of the claim amount, evaluate the mediation window, and use mediation to lock in costs to avoid having to fight all the way to the end.
  • It is essential to appear in court to respond to the lawsuit. Absence from court is equivalent to waiving the right to defend oneself. If you are truly unable to attend the hearing, you should apply for a postponement in advance or appoint a legal representative to attend on your behalf.
  • Within 15 days after receiving the ruling, determine whether it is final and file a lawsuit or apply for revocation in a timely manner. Failure to do so within the time limit will result in the loss of rights. For group cases, it is recommended to entrust a lawyer to handle them collectively.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Labor arbitration legal services·Attorney Feng Na·Beijing Henglu Law Firm