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According to court findings, the incident took place in February 2025 at the company’s warehouse, where the manager, surnamed Zhu, kissed a colleague without her consent. The woman immediately reported the incident to police, Sina News reported.

Public security authorities later placed Zhu in five days of administrative detention for molesting another person, a public-order offense under Chinese law. He was not charged with a criminal offense, according to Dahe News.

Zhu had signed a labor contract running from Oct. 1, 2023, to Sept. 30, 2026. The company’s internal employee rules state that workers who receive administrative punishment or administrative detention may be deemed to have committed serious misconduct, allowing the employer to terminate the labor contract without compensation.

On May 12, 2025, the company met with Zhu, who acknowledged the detention and said he would accept the firm’s decision. The company then issued a notice terminating his contract, effective May 15, 2025.

Zhu later filed for labor arbitration and then sued the company, seeking more than 168,000 yuan (US$24,156) in compensation. He argued that under China’s Labor Contract Law, an employer can only dismiss a worker without compensation if the employee is held criminally liable, which he was not.

Both the trial court and the appellate court rejected his claim. The appeals court ruled that criminal liability is a sufficient but not necessary condition for termination, and that company rules allowing dismissal following public security administrative punishment were reasonable, lawful and properly disclosed to employees.

The court ultimately upheld the dismissal and rejected Zhu’s compensation claim in full.