A new job intention contract for university graduates will for the first time set a ceiling on financial penalties for breaching the deal, officials with the Shanghai Education Commission revealed.

The new contract, which will be used by local university graduates next year, will state clearly that students should be charged no more than their promised monthly income if they breach the contract.

As many university students begin looking for a job early in their final year, they must sign a contract with the companies they intend to work for before signing a formal working deal after they have graduated.

Currently, the unified contract doesn't set a ceiling on punishments for violating the deal.

Tian lei, the commission's university graduate employment official, said the change was made to reduce students' contract violation risk to the lowest level.

With the current version, some employers in the city will sloppily write a figure or vaguely say "salary will be paid in accordance with the country's regulation" when signing the job intention contract with students.

But they will set astonishingly high penalties in order to ensure the student works for the company after graduation.

(Shanghai Daily November 20, 2004)