• Thu
  • Dec 25, 2014
  • Updated: 10:20am

Draft guidelines push employers on insurance

PUBLISHED : Thursday, 17 November, 2011, 12:00am
UPDATED : Thursday, 17 November, 2011, 12:00am
 

Draft guidelines on social insurance reiterate that employers on the mainland must buy five types of insurance for workers, including compensation for those injured on the job, and medical benefits for pregnancy.

The previous social insurance guidelines, from 1999, list only pension, medical and unemployment as the three categories of social insurance to which employers must contribute. Government regulations passed since then have said that social insurance for workers' injuries and for pregnancy are also compulsory - but their enforcement has been poor in less-developed regions of the country, and the regulations are often overlooked.

The draft Social Insurance Collection Guidelines released yesterday for public consultation state clearly that employers must buy all five categories, or face severe consequences such as having their bank accounts frozen and money transferred to social insurance departments.

The draft is meant to provide more details on implementing the new Social Insurance Law that came into effect in July, and to strengthen enforcement of such payments, according to labour law experts.

Current reality is that compliance varies depending on region, type of worker and type of insurance.

In first- and second-tier cities, the majority of employers were already paying all five forms of insurance, especially non-mainland companies, which were normally more law-abiding, several law experts said. But even in these more developed regions, employers in some industries, such as construction, still might not pay in full; or in cases where migrant workers were concerned, there might not even be a contract.

Payment of insurance for pregnancy has been particularly poor. According to figures provided in March by the vice-president of the All-China Women's Federation, Hong Tianhui , only about two million workers enjoyed this insurance, while there were 16 million births in the year. The insurance is meant to benefit pregnant workers, or those whose wives are unemployed.

Some people have said online that the two types of insurance increase costs and make operations for small and medium-sized enterprises even more difficult, but lawyers disagree. 'The main point of these guidelines is not the addition of the two types of insurance as compulsory, because this is already what the current law requires,' said Ge Lei of Yingke Law Firm in Beijing. 'What's important is that now the guidelines give social insurance departments more tools to enforce payments.'

Lawyer Liang Yansong said social insurance departments had to go through procedures to confiscate a defaulting employer's money from a bank account, but the new guidelines stated that the court had a duty to co-operate. 'In the end these types of insurance ... help save money for employers,' Liang said.

Share

For unlimited access to:

SCMP.com SCMP Tablet Edition SCMP Mobile Edition 10-year news archive
 
 

 

 
 
 
 
 

Login

SCMP.com Account

or