A draft law on labor contract was passed Friday during an executive meeting of the State Council presided over by Premier Wen Jiabao.

The meeting said that the labor contract system set up in July 1994 played an important role in promoting the harmonious relationship between employees and employers.

As China's market economy develops, new problems are cropping up in the implementation of the labor contract system.

A special law on a labor contract system under the condition of the socialist market economy is being drafted.

According to the meeting, the draft law would be delivered to the Standing Committee of the National People's Congress for deliberation after some modifications.

The meeting also analyzed social and economic development up to now this year and studied the economic work next year according to the proposal on the 11th Five-Year Program passed earlier this month at the fifth plenary session of the 16th Central Committee of the Communist Party of China.

(Xinhua News Agency October 29, 2005)