China plans to include all foreign workers in its social security system starting from July, a senior social security official said.
“The move will ensure foreign employees in China enjoy the same social insurance benefits as Chinese nationals do,” Xu Yanjun, deputy director of social security center with the Ministry of Human Resources and Social Security, said at a news conference.
Target groups include foreign workers employed by Chinese and overseas-funded enterprises, social groups, law firms and foundations that register in China, as well as foreign workers assigned to China by overseas registered companies, he said.
“All foreign employees who work in China for longer than six months must be included in the social security system,” said Xu.
Foreign workers will be responsible for some of the premiums, but workers from countries that have signed social insurance agreements with China could avoid paying some of the fees, Xu said. So far, Germany and South Korea have signed such agreements.
The latest census in 2010 revealed that there were nearly 600,000 foreigners living in China.
Clare Pearson, a British national who moved to China five years ago and who now works at a Chinese magazine in Beijing, said she welcomes the Chinese government’s move to include foreign workers into the social security system.
“I think it’s a good move which could benefit foreigners like me who love to stay and work in this country,” she said.
“I don’t care about the monthly social insurance fees that I should pay because such a measure would make me feel that I’m no longer an outsider but a part of the country.”
The new Social Insurance Law specifies that all employees will have the right to basic endowment insurance, basic medical insurance, work injury insurance, unemployment insurance and maternity insurance.
Take endowment insurance, for example. In China, workers pay 8 percent of their wages and employers pay an amount equal to 20 percent of workers’ wages each month to workers’ pension accounts. Workers must contribute to the pension accounts for at least 15 years to collect a pension after retiring.
Workers and employers also collectively pay workers’ medical insurance and unemployment insurance but employers are responsible to pay for work injury insurance and maternity insurance.
“Any employer who refuses to fund that insurance for employees would incur a fine equal to one to three times the sum of workers’ due insurance fees,” said Xu.
Lu Xuejing, a social security expert at Capital University of Economics and Business, said although the government’s move will increase employers’ burdens, bosses should take the chance to realize that it is their responsibility to pay social security for everyone they employ, no matter where they are from.
“The move would help foreign workers enjoy social security benefits in China, especially laborers from developing Southeast Asian countries who could better deal with their medical treatment here,” she said.
But Lu said the move might make employers think more about the cost before hiring foreign workers and she predicted that if the law is strictly put into place there might be a fall in number of foreign employees in China.
For a foreign employee who is eligible to enjoy a pension but has left China, he or she should make arrangements with a Chinese embassy to continue to receive the pension. Chinese law also permits the balance of an individual’s pension account to be inherited by his or her offspring, Xu said.
China Daily Asia Weekly on June 03, 2011, page 09