Overview
- The Hangzhou Intermediate People’s Court ordered a tech firm to pay 260,000 yuan to an employee identified as Zhou after ruling his AI-linked dismissal unlawful.
- Zhou was told to accept a demotion with a 40% pay cut after his quality assurance role was automated, refused the downgrade, and was then fired.
- An arbitration panel backed Zhou, a district court upheld that finding, and the appellate court affirmed the outcome and compensation.
- Judges said companies cannot terminate or cut pay solely because tasks are automated, framing AI adoption as a foreseeable, voluntary decision rather than a legal basis to end contracts.
- The case follows a similar ruling involving a mapping company and comes as officials stress labor stability, with state media and legal experts saying employers should consider reassignment, retraining, and documented restructuring before cutting staff.