Union warns firms over mass layoffs

China's top labor union, the All-China Federation of Trade Unions (ACFTU), released a circular criticizing companies such as Huawei and Wal-Mart for forcing long-time employees to resign, Xinhua Net reported (in Chinese). The ACFTU said such practices violate current labor regulations as well as the new labor contract law, which goes into effect on January 1, and that cases causing significant social consequences will be "strictly punished." Huawei, a domestic telecom equipment maker, has required thousands of employees who had worked in the company for more than seven years to resign with compensation and re-apply for their jobs as freshmen, while Wal-Mart has fired over 100 employees in China, citing economic reasons. The layoffs were seen as moves reduce labor costs and avoid risks associated with the coming labor law.