Labor Arbitration differs from regular commercial arbitration. Labor Arbitration refers to the arbitration for labor disputes by special arbitration commissions of labor disputes. In China, Labor Arbitration is a necessary and required procedure before a lawsuit for the same labor dispute can be brought before a court of law. The award made as a result of the Labor Arbitration is not final. One of the rationales underlying the regulation for Labor Arbitration is to promote the speedy and cost-effective resolution of labor disputes. Because labor disputes are highly specialized, it is recommended that professionals who are well versed in employment law and practice be hired.

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