Ex-GSK China staff seek compensation for illegal dismissal

Wed Jul 16, 2014 11:58am EDT
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By Li Hui and Adam Jourdan

BEIJING/SHANGHAI (Reuters) - Three former Chinese employees of GlaxoSmithKline PLC GSK.L, which is embroiled in a long-running corruption probe in China, are seeking compensation for illegal dismissal from their jobs, a lawyer representing them told Reuters.

The plaintiffs are seeking two months' pay for each year of their employment from Britain's biggest drugmaker for dismissing them between April and May for expenses that were "not compliant with company regulation," Shanghai-based Liu Feng said.

They are also seeking reimbursement for unpaid expenses, the lawyer added. Some former sales staff at GSK were laid off with unpaid expenses, part of which were used to pay doctors and hospital staff with approval from their managers.

In some cases, the unpaid expenses were worth more than 200,000 yuan ($32,200), according to Liu.

The labor dispute arbitration committee in Shanghai's Huangpu district will hear the case on Thursday.

A similar labor arbitration case filed by a former GSK salesperson was heard in the central province of Henan in May. That plaintiff, who did not want to be named, said by telephone that the decision would be issued soon.

While any compensation GSK could end up paying will be relatively minor, it is another headache for the drugmaker and could further tarnish its reputation in the Chinese market.


A Chinese national flag is seen in front of a GlaxoSmithKline office building in Shanghai, July 12, 2013.  REUTERS/Aly Song