China court rules companies can’t replace employees with AI to cut costs

A Chinese court has ruled that companies cannot legally dismiss employees solely to replace them with cost-saving artificial intelligence tools, setting a clear boundary on how far firms can go in using automation to reduce labour costs. On April 30, the Hangzhou Intermediate People’s Court issued the ruling while hearing a dispute involving a senior tech worker, surnamed Zhou, who said his employer tried to demote him after introducing AI systems into its workflow. Zhou joined the company in November 2022 as a quality assurance supervisor, earning a monthly salary of about $3,500. His responsibilities included optimising AI-generated outputs and…