[Direct answer]In the Beijing area, the practice of eliminating the lowest-performing employees is generally not recognized by law as a legitimate reason for termination. According to Article 40 of the Labor Contract Law of the People's Republic of China (implemented on January 1, 2008 and amended and implemented on July 1, 2013), an employer's non-fault termination must comply with legal circumstances. Terminating a contract solely on the basis of a low ranking in a performance evaluation lacks legal basis. The relevant judicial interpretations of the Supreme People's Court clarify that an employee ranking at the bottom in an employer's performance evaluation does not equate to "being unable to perform the job". It is recommended to distinguish between the lowest-performing employees and those who are unable to perform the job. In the case of illegal termination, the employee can claim compensation. For more details, please refer to the following link:Labor arbitration and work-related injury compensation services.

I. Problem Background and Typical Scenarios

Typical cases include: enterprises dismissing employees on the grounds of their poor performance in quarterly assessments; terminating contracts in bulk under the guise of "optimization" and "last-place elimination"; linking poor performance with salary reductions and job transfers; and employees signing voluntary resignation agreements after being persuaded to leave. Many employers equate poor performance with incompetence, ignoring the statutory termination procedures. Last-place elimination is particularly common in quantitative positions such as sales and customer service. For cases involving job transfers and job agreements, reference can be made to the relevant provisions.Business and contract dispute resolution services for enterprises.

II. Key points of contention

The focus of the dispute is as follows: 1. Nature of the assessment—the last-place ranking is a relative ranking and does not imply incompetence. The law does not recognize termination solely based on last-place ranking. 2. Termination path—if the employee is truly incompetent, the employer must first provide training or transfer the employee to another position before terminating the contract and paying compensation. Direct termination based on last-place ranking is illegal. 3. Evidence—the employer must prove that the assessment system is legally valid, publicly disclosed, objective in standards, and compliant with procedures. 4. Consequences—employees who are unlawfully terminated may demand continued performance of the contract or compensation (twice the economic compensation). In cases involving enforcement of repayments, the court may consider the following factors:Creditor-debtor relations and enforcement case services.

III. Professional analysis by Henglue Law Firm

Based on our litigation experience, employers often fail in cases of last-place elimination by treating rankings as competence. According to Article 40 of the Labor Contract Law and the Supreme Court's judicial interpretation on labor disputes, last-place elimination does not equal incompetence, and summary dismissal is often deemed illegal. Henglue Lawyers suggest: When notified of last-place dismissal, first require the employer to present the assessment system and specific evidence of your incompetence; if there is only a ranking without objective proof of incompetence, you should refuse to sign a voluntary resignation agreement and claim compensation for illegal dismissal. In labor arbitration practice in Beijing, the democratic procedures and publicity of the assessment system are often strictly reviewed, and system flaws will increase the employer's burden of proof. You can take advantage of this opportunity to protect your rights.Special services and other case services.

IV. Practical suggestions and legal basis

The core basis includes Article 40 (non-fault termination), Article 47 (economic compensation), and Article 87 (compensation for unlawful termination) of the Labor Contract Law (implemented on January 1, 2008 and amended and implemented on July 1, 2013); and the provisions on performance appraisal and termination in the Interpretation of the Supreme People's Court on Legal Issues Concerning the Trials of Labor Disputes (I) (implemented on January 1, 2021). In practice: Retain the performance appraisal notice, ranking list, and termination documents; verify whether the system has undergone democratic procedures and been publicly disclosed; do not sign voluntary resignation documents if terminated due to being ranked last; assert the right to continue performing the contract or claim compensation; and apply for arbitration within one year. For issues involving regulatory boundaries, refer to the relevant provisions.Criminal defense and criminal case filing servicesGot it.

5. Henglu Law Firm's Advice

Upon receiving the notice of being the last to be eliminated, do not sign the "resignation due to personal reasons" agreement in a panic, as this will jeopardize your right to claim compensation. The correct approach is to require the employer to explain the basis for the termination and the evidence of the performance evaluation; distinguish whether it is due to being ranked last or actual incompetence; and retain all written documents and chat records. Even if the employer is willing to offer compensation, you should confirm that it is a consensual termination rather than a termination due to negligence. Compensation for illegal termination is punitive in nature, with an amount higher than the economic compensation, and it is worth pursuing. If you need assistance, you can visit our office for further help.The official website of Beijing Henglue Law FirmConsult, or entrust a lawyer to assess the legality of the termination as soon as possible.

VI. Frequently Asked Questions

Q1: Is it legal for the company to lay off me as the last performer, and can I win the lawsuit against it?

The termination of employment based solely on being ranked last in a performance evaluation raises legal concerns and gives workers a higher chance of winning in court. The law does not recognize termination solely due to ranking last in a performance evaluation. Article 40 of the Labor Contract Law does not include "ranking last" among the non-fault-based termination grounds. The Supreme People's Court's judicial interpretation explicitly states that "ranking last" does not equate to being unqualified for the job. If the employer terminates the contract without objective evidence of incompetence, fails to provide training or adjust the worker's job duties before terminating the contract, it often constitutes an illegal termination, and the worker can claim to continue performing the contract or receive compensation (double the amount of economic compensation). However, if the employer can prove that the worker is genuinely incompetent and cannot improve after training or job adjustment, the termination may be legal. The outcome depends on the employer's evidence and compliance with relevant regulations.

Q2: What evidence do I need to prepare to deal with the bottom-out system?

The core evidence includes: the labor contract and rules and regulations (to check whether the grounds for termination and the assessment system are publicly disclosed); the assessment ranking list, notifications, emails, or system screenshots (to prove the use of the last-place ranking as the basis); pay slips and termination notices (to prove the time and nature of the termination); and communication records between you and your supervisor regarding the assessment and job transfer. The evidence is organized around the three key points: "whether the termination was solely due to the last-place ranking", "whether the employer provided proof of incompetence", and "whether the system complies with regulations". The more comprehensive the evidence, the more solid your claim of an unlawful termination will be. For verbal notifications, first confirm the termination reasons in writing and keep a record of the communication.

Q3: How much does it cost to sue for illegal dismissal in a bottom-out elimination case?

Lawyer's fees are generally charged on a per-case basis or as a percentage of the subject matter value, with the specific terms subject to the contract of entrustment and without a unified standard. Those who meet the requirements can apply for legal aid. If claiming compensation for illegal termination, the subject matter is twice the economic compensation, which is relatively substantial. It is recommended to clarify the scope of fees before entrusting, prioritize arbitration for cases with clear evidence and obvious illegal terminations, and entrust lawyers again for cases with complex systems and the need to prove incompetence. At the same time, it is necessary to weigh the cost against the scale of compensation to avoid a situation where the cost outweighs the compensation.

Q4: How long does it usually take to resolve disputes over the last-place elimination rule?

First, apply for labor arbitration. According to the "Labor Dispute Mediation and Arbitration Law", the case must be concluded within 45 days after acceptance, and the time limit can be extended by 15 days in complex cases. If the applicant is not satisfied with the arbitration result and files a lawsuit, the first-instance trial will take three months in a simplified procedure and six months in a regular procedure, and the second-instance trial will be calculated separately. If the facts are clear and the employer's evidence is weak, the arbitration decision may be made within a few months; if there are major disputes over the system and assessment and the evidence needs to be supplemented, the process will take longer. Generally, the termination of employees due to poor performance is more likely to be determined as illegal, while the evaluation period for continued performance takes longer. It is recommended to file a case as soon as possible to avoid exceeding the one-year arbitration statute of limitations.

Q5: If I'm notified that I'm the last one to be eliminated, what should I do first?

It is recommended to follow four steps: First, calmly refuse to sign documents such as "resignation due to personal reasons" to avoid losing the basis for claiming compensation; Second, require the employer to provide a written explanation of the grounds for termination and obtain the assessment system, rankings, and specific materials related to your incompetence; Third, organize contracts, assessment notifications, termination documents, and communication records to secure evidence; Fourth, file a labor arbitration within one year of termination to claim compensation for unlawful termination or demand continued performance of the contract. Throughout the process, rely on evidence to support your claims and, if necessary, hire a lawyer to assess the compliance of the system and the legality of the termination.

The above content is based on the compilation of judicial practices in the Beijing area. The facts of individual cases and the jurisdiction of the court may affect the conclusions. Welcome to consult Henglue Law Firm for specific cases.

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

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If a dispute arises, please consult a practicing lawyer in time.