Posted on China.com.cn, Oct. 22, 2008
An Interview with Mr. Michael Diaz: Enterprises should Adapt Actively to Labor Law of PRC.
“The Third Annual Conference on Dispute Avoidance and Resolution” was held in Beijing through October 13, 2008 to October 14, 2008. During the meeting the journalist interviewed Mr. Michael Diaz, a partner of Diaz Reus Law Firm headquartered in America. Mr. Diaz talked about his personal opinions as to how enterprises should cope with risks and how lawyers should serve enterprises.
Q: Diaz Reus is an international law firm that provide full service, and it has its offices in America, Latin America, Europe, Asia and the Middle East. I want to know if Diaz Reus has any plans of opening representative office in China in the future?
Michael Diaz (M for abbreviation): Yes, we are now planning to open offices in China. Although, the license for Shanghai office is pending, and I think, we will get our license soon.
Q: I have read the introduction to Diaz Reus’s service range. You provide extensive legal services, including a great number of foreign-related services, for your clients, which means that you have to deal with clients and governments from lots of different countries. What do you think is the greatest challenge for a law firm to expand its businesses in another country?
M: The greatest challenge, I think, is to know the local laws. The local government will have lots of restrictions to foreign-invested firms, such as the range of services. Therefore, we want cooperation with local law firms. We don’t want to compete with them. It will be easier for us to do our businesses if there are local lawyers who are willing to help us dealing with problems we met. Besides, we can have a good understanding of local laws through dealing with cases.
Q: The Chinese government enacted the new Labor Law of the People’s Republic of China at the beginning of this year, which has aroused extensive discussion in the society. Particularly some of the enterprises responded in an intense way. But now the situation seems to have been getting better. As a lawyer, what do you think of this law?
M: I think it is a very good law and I don’t think it will bring adverse effects to enterprises.
Q: Since the implementation of the Labor Law, the disputes between enterprises and laborers have been accelerating. Some enterprises think that this law shows partiality for the laborers and increases the cost of enterprises. But still more people believe that enterprises were profit-centered and ignored the lawful interests of workers before. The publishing of this law not only explicitly make clear the rights and interests of workers but also enhance the awareness of them to protect their lawful interests. Therefore it’s normal that disputes increase. The disputes between employers and employees will gradually decrease as the enterprises learn more about the Law of Labor’s. What’s your opinion?
M: China has become increasingly important in its financial status around the world with its economic development. The government therefore begins to enhance its protection of the employees and the enterprises must try to adapt to this law. Employees are the essential part of enterprises. Without labor force, there would be no profits of the enterprises.
Q: Now lots of big companies can’t decide whether they should set up their own legal department inside the company or they should depend completely on professional law firms. What do you think is the most suitable way for enterprises?
M: This is a good question. It is difficult, and almost impossible, for the legal consultant of a big company to deal with all the legal problems in an adequate way. When there are some complicated legal problems, it would be a good choice for the legal consultant to deal with a quarter or one half of the problems themselves and then seek help from professional law firms for the rest of the work. In this way they can get professional and top-quality services; besides, they’ll be able to have the time and energy to reconsider the whole event. Moreover, the company can reduce its expenses by seeking help from professional law firms for some of its businesses.
Q: Do you have any good methods to help company reduce the number of its legal disputes?
M: First we will try to deeply understand the operating situation of the company in a bid to find out in which respects will a legal disputes most probably occur. Then we will draw up relevant rules and regulations to avoid or reduce the disputes. It will be difficult to let those leaders do by the laws if they are devoid of legal awareness. At this time you should tell him some of the cases in which great disputes happen because of the company’s lack of attention to law. If you explain to them the advantages of doing by the law and the disadvantages of ignoring the law, they will agree with you and accept your suggestions.