Oct 2011The China Social Security Law ("the SS Law") and its Implementation Measures which took effect on 1 July 2011 introduced a national framework with an aim to standardise and strengthen the social security scheme administered by local governments for Chinese employees as well as their employers in China. The Chinese social security scheme covers five types of social security contributions, namely pension, medical insurance, work-related injury insurance, unemployment insurance and maternity insurance. To follow international practice and protect the legitimate rights and interests of foreign employees working in China, the SS Law has stated that foreign employees should also participate in the social security scheme.
In June 2011, the Ministry of Human Resources and Social Security ("MHRSS") released the draft Provisional Measures on the Participation in the Social Security Scheme by Foreign Employees Working in China ("the Provisional Measures") for public consultation, which clarified the uncertainty brought about by the SS Law on how foreign employees would be affected. The draft Provisional Measures have stirred up widespread concerns on how foreign employees could in practice enjoy the social security benefits after making their contributions. Upon the public comments collected, the MHRSS finalised the Provisional Measures, which will take effect on 15 October 2011.
In this News Flash, we would share with you the key areas of the Chinese social security scheme relevant to foreign employees and our observations.
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