China Law Insight : China Law Insight: China Commercial and Intellectual Property Lawyers and Attorneys, Full Service Law Firm: King & Wood

 According to the Decision, where the employer who is liable for work safety accidents (hereinafter the "liable employer") lies about or conceals the work safety accidents, it will be subject to a penalty of RMB 2 million; meanwhile, if the liable employer delays the rescue, or causes the accident enlargement, or interferes with the investigation, the liable employer will be fined RMB 3 million, and in serious cases where the means of the liable employer is abominable, such employer will be fined RMB 5 million.

 The Decision also provides that if the main person in charge of the liable employer, or any direct responsible person in charge or any other direct responsible person lies about or conceals the accident, or escapes after the accident happened, that person will be subject to a fine equivalent to his/her annual income of the last year.

King & Wood's Note: In reality, work safety accidents will usually cause casualties or economic damages; and sometimes the losses could be even worse if the rescue is delayed due to the liable employer' s lying or concealment of the accidents. To minimize the work safety accidents and protect employees' safety and health, the Decision raises the fine on the liable employer and its relevant persons in charge. 

By referring to regulations provided by the International Labor Organization Convention (the "ILO Convention"), the Draft Regulations increase the minimal maternity leave period from 90 days to 14 weeks. Furthermore, the Draft Regulations stipulate that female employees may have at least 2 weeks in maternity leave for miscarriages within four months of being pregnant; while female employees that miscarried after four months should have at least 6 weeks of maternity leave.

征求意见稿参照国际劳工组织公约的规定，将产假由90天增至14周。此外，征求意见稿细化了流产假期，规定：女职工怀孕未满4个月流产的，不少于2周的产假；怀孕满4个月流产的，不少于6周的产假。

1. Where an employer registered in the PRC hires a foreigner, both the employer and the foreigner are obligated to contribute to basic pension insurance, basic medical insurance, work-related injury insurance, unemployment insurance and maternity leave insurance (the “Required Contributions”).

2.  Where a foreigner enters into an employment contract with an overseas employer and is seconded to work in a branch or representative office registered in China (the “Domestic PRC Office”), the foreigner must also participate in the Required Contributions, and the Domestic PRC Office and the foreigner must pay insurance contributions in accordance with PRC law.

3. Where an entity registered in the PRC hires a foreigner, or accepts a foreigner seconded by his/her overseas employer, the entity registered in the PRC shall handle the social insurance registration for the foreigner within 30 days of obtaining a work permit.

4. As to a foreigner who participates in the PRC social insurance scheme, if he/she meets the required conditions, he/she will be entitled to social insurance benefits in accordance with PRC law.

5. Where a foreigner departs China before reaching the age eligible for receiving pension payments, his/her social insurance account will be kept, and his/her contribution years will continue to accumulate once the foreigner comes back to work in China in the future.  Alternatively, if the foreigner applies in writing to end his/her social insurance, the balance of his/her social insurance account may be paid to him/her in a lump sum.

6. Upon death, the balance of a foreigner’s social insurance account may be inherited.

7. A foreigner who receives monthly PRC social insurance benefits while outside China must submit a Certificate of Life to the social insurance agency that is responsible for paying him/her social insurance benefits.  This Certificate of Life must be submitted at least once a year, and needs to be issued by a PRC embassy or consulate, or notarized and certified by relevant authorities in the country where he/she resides and certified by a PRC embassy or consulate.

Where a foreigner enters into China legally, he/she may go directly to the social insurance agency to prove his/her life status, and a Certificate of Life mentioned in the above paragraph is not required.

8. Where a foreigner who participates in social insurance has a dispute with his/her employer or the Domestic PRC Office regarding social insurance, he/she may apply for mediation or arbitration or bring a lawsuit in accordance with PRC law.  Where the employer or the Domestic PRC Office infringes upon the foreigner’s right to social insurance, the foreigner may also request social insurance administrative departments or social insurance collection agencies to resolve the dispute in accordance with PRC law.

9. If a foreigner working in China is a citizen of a country that has entered into a bilateral or multilateral treaty regarding social insurance with China, his/her social insurance will be dealt with in accordance with that treaty.

10. Social insurance agencies will issue social security numbers for foreigners and distribute PRC social security cards to them in accordance with the Rules of Establishing Social Security Numbers for Foreigners.

1. 中国境内的用人单位雇佣外国人的，应当由该用人单位和外国人本人按照规定缴纳职工基本养老保险、职工基本医疗保险、工伤保险、失业保险和生育保险（下称“五险”）。

2. 与境外雇主订立雇佣合同后，被派遣到在中国境内的分支机构、代表机构（下称“境内工作单位”）工作的外国人，也应当依法参加五险，由境内工作单位和本人按照规定缴纳社会保险费。

3. 境内单位招用外国人的，或者接受境外雇主派遣到境内工作的外国人的，应当自办理就业证件之日起30日内为其办理社会保险登记。

4. 参加社会保险的外国人，符合条件的，依法享受社会保险待遇。

5. 外国人在达到规定的领取养老金年龄前离境的，其社会保险个人账户予以保留，再次来中国就业的，缴费年限累计计算；经本人书面申请终止社会保险关系的，也可以将其社会保险个人账户储存额一次性支付给本人。

6. 外国人死亡的，其社会保险个人账户余额可以依法继承。
7. 在中国境外享受按月领取中国社会保险待遇的外国人，应当至少每年向负责支付其待遇的社会保险经办机构提供一次由中国驻外使、领馆出具的生存证明，或者由居住国有关机构公证、认证并经中国驻外使、领馆认证的生存证明。
外国人合法入境的，可以到社会保险经办机构自行证明其生存状况，不需提供前款规定的生存证明。

8. 依法参加社会保险的外国人与用人单位或者境内工作单位因社会保险发生争议的，可以依法申请调解、仲裁、提起诉讼。用人单位或者境内工作单位侵害其社会保险权益的，外国人也可以要求社会保险行政部门或者社会保险费征收机构依法处理。

9. 具有与中国签订社会保险双边或者多边协议国家国籍的人员在中国境内就业的，其参加社会保险的办法按照协议规定办理。
     
10. 社会保险经办机构应当根据《外国人社会保障号码编制规则》，为外国人建 立社会保障号码，并发放中华人民共和国社会保障卡。
 

In this recent case, the court vacated a previous labor arbitration decision on the grounds that the Labor Contract Law (effective Jan. 1, 2008) did not apply retroactively to the case at hand. The plaintiff in this case started to work for a Beijing medical technology company in Nov. 2007 with a probation period that lasted until Jan. 2008. In Feb. 2008, he was terminated for incompetence. He filed for a labor arbitration and was awarded RMB 3600 compensation under the Labor Contract Law. The company requested the court vacate the decision. Upon review, the court determined that the arbitrator retroactively applied the Labor Contract Law on severance calculation and vacated the arbitrator's decision on that ground.

This is the first reported case of a court vacating a previous labor arbitration award. Once vacated, the case could not be submitted to arbitration for a second time and the only recourse is now to seek judicial remedies before the courts.

In light of recent labor employment legislation, this decision will become persuasive authority for similar employment disputes. Unlike other countries in terms of costs and processing time, to arbitrate an employment dispute in China requires no filing fee and a final decision will be obtained within a couple of months. Labor arbitration filings have tripled since the promulgation of the new Labor Contract Law. Previously, either party could appeal the arbitration decision to the court to have a completely new trial of both factual disputes and legal issues. Under the new Labor Mediation and Arbitration Law, as illustrated by this case, arbitration decisions will now have certain limitations as to judicial appeal/review. In the short term, it will effectively reduce the court's case load. In the long term, it will teach the public to have a more rational view of employment litigation. For practitioners, the amount in controversy now becomes an important factor in evaluating the overall procedural strategy, since certain small claims of employment disputes will have limited grounds to appeal arbitration decisions.