Wednesday, 13-05-26
Across Asia, governments and courts are addressing how artificial intelligence should be used in workforce restructuring. The focus is on managing AI-driven changes while protecting employees’ rights under labour laws.
The discussions highlight how far companies can go in replacing workers with AI systems during business transformation.
China Courts Rule AI Cannot Justify Employee Termination
In China, courts have ruled that companies cannot dismiss employees simply because artificial intelligence can perform their jobs at a lower cost.
The case involved a tech worker surnamed Zhou, who worked in quality assurance. His company attempted to reassign him and reduce his salary from 25,000 yuan (about US$3,655) to 15,000 yuan before ultimately terminating him after he rejected the change.
The Hangzhou Intermediate People’s Court ruled the dismissal illegal and ordered compensation. The decision was later upheld on appeal.
The court stated that replacing workers due to AI efficiency does not fall under legally permitted grounds for termination, such as business closure or poor management.
Legal Limits on AI-Driven Restructuring in China
The court further ruled that AI adoption is considered a voluntary business decision, not an unforeseeable external event.
It stated that the company’s restructuring did not meet the legal threshold of an “objective major change” that would make a labour contract impossible to fulfil.
Under Chinese labour law, such major changes must involve uncontrollable events like natural disasters or policy shifts. Courts clarified that AI adoption is a predictable business strategy.
In a separate case, a data worker surnamed Liu was dismissed after his company fully automated its mapping operations. Authorities ruled the termination unlawful, stating that the company’s decision to automate was deliberate and not an unpredictable circumstance.
The rulings reinforced that companies must negotiate with employees, consider retraining, or provide reasonable reassignment before termination.
Singapore Debates “No Jobless Growth” in AI Transition
In Singapore, Parliament debated a motion on “no jobless growth” amid AI-driven disruption. The motion was supported unanimously after a seven-hour debate.
Minister for Manpower Tan See Leng said the government will review proposals to improve the SkillsFuture Jobseeker Support scheme, which provides temporary financial and job search support of up to S$6,000 over six months for eligible retrenched workers.
Lawmakers raised concerns that professionals, managers, and executives may also face job displacement from AI and require stronger transition support.
Government Response: Support, Training, and Workforce Adjustment
The Singapore government said AI transformation must be inclusive and actively managed.
Minister Tan said some jobs will be replaced as work processes change due to AI, but workers will be supported through the transition.
He also stated that Singaporeans will not be “passive passengers” but “co-pilots” in the AI transition.
The government highlighted ongoing measures such as training programs, job redesign support, and workforce transformation initiatives.
These include funding schemes for companies, support for retraining, and initiatives under the Tripartite Jobs Council. More than 3,800 Company Training Committees have been formed since 2019, benefiting over 300,000 workers.
Additional efforts include expanding AI-related training, improving workforce readiness tools, and strengthening employment support systems for affected workers.
This article is a summary of two original articles. The full versions can be read at the following links:
https://finance.yahoo.com/sectors/technology/articles/ai-termination-ban-why-chinese-184031008.html
PHOTO: FREEPIK
This article was created with AI assistance.
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