Overview
- A Hangzhou intermediate court found a fintech firm’s dismissal of a 35-year-old employee unlawful and ordered more than 260,000 yuan in compensation.
- The worker, surnamed Zhou, oversaw checks on AI-generated answers, refused a demotion with a steep pay cut after the firm adopted AI tools, and then won at arbitration, trial, and appeal.
- Judges said replacing a person to cut costs does not meet the legal test of a “material change in objective circumstances,” so it does not justify ending a labor contract.
- The court said companies may use AI to boost efficiency but cannot cut pay or cancel contracts in the name of technological change.
- State media highlighted the decision after the State Council shared it, and an earlier 2024 Guangzhou case reached the same conclusion, pointing employers toward reassignment, training, and real negotiation when rolling out AI.