Rongsheng Petrochemical Ordered to Rectify Over Worker Director's Missing Labor Contract; Yu Fengdi Resigns in

On August 13, Rongsheng Petrochemical announced that it had received a decision from the Zhejiang Securities Regulatory Bureau on August 12 ordering the company to take corrective measures. The decision stated that the company's current worker director, Yu Fengdi, has no labor relationship with the listed company and therefore does not meet the qualifications for a worker director. On the same day, Yu Fengdi submitted a written resignation, stepping down as worker director, citing "rectification needs" as the reason. This marks the first case in A-share history in which a company has been penalized by regulators because a worker director had not established a labor relationship with the listed company.

Tracing Yu Fengdi's appointment process, on May 16, 2025, Rongsheng Petrochemical convened a workers' congress and elected Yu Fengdi as worker director of the seventh board of directors. The resume disclosed at the time showed that Yu Fengdi had received the title of Hangzhou Model Worker and had served as a technician in the production technology department of Shaoxing County No. 1 Polyester Factory, head of the production technology department of Shaoxing No. 1 Chemical Fiber Factory, and manager of the false-twist department and assistant to the general manager of Rongsheng Chemical Fiber Group. At the time of her election, her primary role was vice president of Zhejiang Rongsheng Holdings Group, the controlling shareholder. At the first meeting of the seventh board of directors held on May 16, 2025, Yu Fengdi was not only elected as a director but also joined the nomination committee and the remuneration and assessment committee.

The August 13 announcement showed that, in accordance with relevant provisions of the Securities Law, the Zhejiang Securities Regulatory Bureau decided to impose corrective supervisory measures on Rongsheng Petrochemical and record the matter in the securities and futures market integrity files. Rongsheng Petrochemical promptly made personnel adjustments. On August 13, the company also announced that it had received Yu Fengdi's written resignation on August 12, with the reason clearly stated as "due to rectification needs." Yu Fengdi planned to resign as worker director of the seventh board of directors and would hold no further positions at the company after her resignation.

From a legal perspective, a worker director differs from a shareholder-appointed director or an independent director in that the prerequisite for the role is being a current employee of the company, which requires establishing a valid labor relationship with the listed company. A written labor contract is the most direct and standardized evidence of such a relationship. Verification of a worker's labor contract is a necessary step in the process of establishing a worker director at a listed company. Yu Fengdi was found not to have signed a labor contract with the company more than a year after being elected worker director, making this the first such case in A-share regulatory enforcement. As of August 13, Rongsheng Petrochemical's share price stood at RMB 12.70, with a total market value of approximately RMB 126.9 billion.