New Ruling says companies cannot automatically fire you for AI taking your job

As AI keeps expanding into more jobs, a big question is on a lot of people’s minds—can your company just fire you if a machine can do your work? A recent labor case out of Beijing suggests the answer isn’t always yes.

In a 2025 case released by the Beijing Municipal Bureau of Human Resources and Social Security, a longtime tech worker surnamed Liu reportedly challenged his dismissal after his job was replaced by AI. Liu had been handling manual data collection for mapping, but in early 2024, the company reportedly switched to an AI-powered system that made his department obsolete. By the end of the year, he was let go. The company said there had been a “major change in objective circumstances,” which they claimed allowed them to legally end his contract.

Liu didn’t buy that and took the case to arbitration.

The key legal question was whether replacing Liu’s job with AI counted as a “major change in objective circumstances” under China’s Labor Contract Law, which lets employers terminate contracts under certain extreme conditions.

The arbitration committee explained that this clause typically applies to events like natural disasters or mandatory regulatory changes—things beyond a company’s control. But the decision to bring in AI was a business move, not an unpredictable crisis. The committee ruled the company’s choice was about staying competitive and essentially pushed the risk of tech change onto the employee.

That, they said, was illegal.

The ruling not only restored Liu’s rights but also sent a clear message to employers. If you’re adopting AI, you can’t just use that as an excuse to fire people without following proper legal steps. Companies should try to reassign workers, retrain them, or revise contracts first.

The case sets a key precedent in how labor laws apply to job loss in the age of automation, offering a little peace of mind for employees wondering what happens when AI steps in.