Special Disclaimer: This article is an original work by Attorney Shao Shiwei. It represents only the personal views of the author and does not constitute legal consultation or legal advice on specific matters. For article reprints, legal consultations, or business exchanges, please add: sswls66
Based on the legal consultations received by Attorney Shao in recent years from newcomers to the crypto circle or new entrants to the workforce, they often have complex feelings regarding job opportunities in the Web3 industry. How can these feelings be described? Fear, dread, expectation, longing, helplessness, confusion... In short, there are all kinds of emotions.
They seem to vaguely feel that the business activities of their company might not be permitted by the state? But then again, their supervisors have stated that what they are doing is legal and compliant, so theycontinue working or resign immediatelystruggle intensely between these options. To alleviate this fear of the unknown, they choose to consult lawyers.
Not all Web3 jobs offer monthly incomes of 40,000 to 50,000 yuan or even higher. Some ordinary operational, customer service, or assistant positions may only yield an income of a few thousand yuan, which is no different from traditional industries. In other words, not all workers in the crypto circle are "seeking wealth amidst risk."
At the end of each consultation, after answering legal questions, I also provide them with some advice on career planning or professional development, and ask whether they would consider resigning if the company's business indeed carries risks. Most answers are: "I will wait and see, and withdraw once I notice something wrong!" OK, knowing the potential risk points means they will no longer fear blindly, which is a good outcome.
This series of articles will focus on issues of concern to workers in the crypto circle and will be updated irregularly.
Today, let us discuss the issue that concerns all workers:Wages.
01
Paying wages in tokens seems reasonable?
Since they are navigating the Web3 world, it seems normal for wages to be paid in virtual currency. Of course, not all Web3 companies pay employees solely in virtual currency. Some pay in RMB, some in mainstream stablecoins like USDT, some in project tokens, and others allow employees to choose the type of payment, including a combination of RMB and virtual currency.
So, are these forms of wage payment legal?According to the provisions below, paying wages in virtual currency violates legal regulations and should be deemed invalid.
Article 5 of the Interim Provisions on Payment of Wages: Wages shall be paid in legal tender and shall not be paid in kind or in securities in lieu of currency.
Article 16 of the Law of the People's Republic of China on the People's Bank of China: The legal tender of the People's Republic of China is the Renminbi.
Notice on Further Preventing and Disposing of Risks Related to Virtual Currency Trading and Speculation: Virtual currencies do not have the same legal status as legal tender. Bitcoin, Ethereum, Tether, and other virtual currencies do not have legal compensatory power and should not and cannot be circulated and used as currency in the market.
Whether the legal relationship is valid or invalid is a concern for legal professionals, butfor companies and employees, they are not concerned with whether the payment/receipt of virtual currency is invalid; they only care about whether they owe money to the other party or can receive money. After all, for people in the crypto circle, coins are equivalent to money.
Therefore, in practice, when both parties agree to use virtual currency as the method of wage payment, what types of labor arbitration disputes arise? How do courts rule?
02
Common Types of Disputes
1. Both parties agreed to pay USDT, but there is a dispute over whether wages were paid. How does the court rule?
The court determined that the company should pay a total of 30,000 yuan in wages to the worker for a certain month. The worker acknowledged receiving only 10,000 yuan in RMB. The company claimed that the remaining 20,000 yuan was paid in virtual currency, but the worker did not acknowledge that the virtual currency received constituted wages. Therefore, the court ruled that the companymust still make up the payment of20,000 yuan to the employee.
Court's Viewpoint:
Article 50 of the Labor Law of the People's Republic of China clearly stipulates that wages shall be paid monthly in monetary form to the workers themselves. Article 8 of the Regulations on Foreign Exchange Administration of the People's Republic of China stipulates that the circulation of foreign currencies is prohibited within the territory of the People's Republic of China, and settlement in foreign currencies is not allowed, except as otherwise provided by the state. In this case, Atom Chain Company's payment of wages in virtual currency violated legal provisions, and Zhang Yingchun explicitly denied that the aforementioned amounts were paid as wages. Therefore, this court does not accept Atom Chain Company's claim.1
2. The company promised to issue token rewards to employees but failed to do so. What can be done?
The company promised employee Xiao Cao 30,000 IOB tokens, equivalent to 600,000 yuan in RMB. However, it failed to deliver. Xiao Cao filed a lawsuit against the company, demanding payment of 600,000 yuan as the discounted value of the tokens. However,the court did not support the claim.。
Court's Viewpoint:
From the WeChat chat records provided by the defendant, the plaintiff's legal representative did indeed promise the defendant to give tokens to employees as rewards, but did not specify under what conditions the tokens could be redeemed. From the defendant's evidence, although the plaintiff paid tokens to other former employees, it did not actually redeem them for cash. Moreover, tokens are virtual currencies, and their value is uncertain. The token values stated in the table are, at best, estimates at that time. The defendant's request for the plaintiff to pay the discounted value of IOB tokens lacks basis, and this court does not support it.2
3. Can unpaid wages be claimed in the form of virtual currency?
No.
This should be easy to understand. Wages must be paid in fiat currency. Virtual currencies do not have legal compensatory power. If the fact of unpaid labor remuneration exists, even if, according to trading habits during the existence of the labor relationship, the company always paid in USDT and the employee accepted USDT without objection, when filing a lawsuit, the employee can only claim RMB. Similarly, the company cannot claim to pay the employee in virtual currency.3
03
Attorney Shao's Tips
The above cases and judgment results are for reference only and cannot be fully applied by analogy. The reasons are as follows:
Although such disputes are common in practice, due to certain practical reasons (such as management issues or concerns about criminal liability risks), few employees file lawsuits in court with publicly disclosed judgments. What we can see represents only the viewpoint of that particular court or judge. Without sufficient data support, it lacks universality;
China is not a case law country, and the facts of each individual case differ;
Regulations regarding virtual currencies are scattered across various notices and announcements, with no clear legislative provisions. Therefore, there are gaps in the application of law in labor dispute cases involving virtual currencies;
Even in ordinary labor dispute cases, different regions, different jurisdictions within the same region, and different judges within the same jurisdiction may have subjective views on factual findings and the application of law.
Therefore, for specific cases, it is advisable to consult a professional lawyer.
1(2019) Jing 0105 Min Chu No. 63366
2(2019) Hu 0101 Min Chu No. 16673
3(2022) Jing 03 Min Zhong No. 12380
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