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Foreigners set for social benefits
By Liang Yiwen |
01:18 UTC+8 September 10, 2011
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Print Edition
Print Edition
FOREIGNERS working in China will be able to enjoy the same social insurance benefits as Chinese nationals from October 15, according to a regulation issued by the Ministry of Human Resources and Social Security.
All expat workers will have the right to the five forms of social insurance: pensions, medical insurance, work injury insurance, unemployment insurance and maternity insurance.
Previously, they could be covered only by commercial insurance bought by themselves or employers.
Under the new regulation, all expat workers and their employers will have to pay the social premiums just as their Chinese counterparts do.
That's 11 percent of an employee's salary, and the employer contributes its share equivalent of 37 percent of his or her salary. But total deductions are capped at no more than three times those calculated on the average salary in a city.
Human resources experts said the new rule would improve social security for expats but also increase the burden on employers, which may result in a decrease in the number of foreign workers in the long term.
"The new regulation follows international practice as it grants foreigners the same social welfare and benefits as Chinese," said Wang Daben, an associate professor of East China Normal University's population research institute.
Employers must apply for social insurance for their foreign workers within 30 days of applying for their work permits. Only workers from countries that have signed social insurance agreements with China are exempt.
"The new regulation embodies equality," said Chris White, an American who has worked in the country for 10 years and is currently a senior director of a firm based in Shanghai.
"The measure makes me feel I'm no longer an outsider but a part of Shanghai," he said. "It will be very helpful to some young expats with low salaries ... but for most foreigners I think it's more symbolic."
He said few foreigners stay in the country until retirement age which means they could not get the pension.
He also said that many expats go to hospitals' VIP rooms rather than the public hospitals whose expenses will be covered by the medical insurance.
The regulation states that those who leave China before retirement age - 60 for men and 55 for women - can claim back their pension contributions. "The sum paid by employers goes to the social security pool," Wang said.
About 593,800 foreigners were working on Chinese mainland late last year.
All expat workers will have the right to the five forms of social insurance: pensions, medical insurance, work injury insurance, unemployment insurance and maternity insurance.
Previously, they could be covered only by commercial insurance bought by themselves or employers.
Under the new regulation, all expat workers and their employers will have to pay the social premiums just as their Chinese counterparts do.
That's 11 percent of an employee's salary, and the employer contributes its share equivalent of 37 percent of his or her salary. But total deductions are capped at no more than three times those calculated on the average salary in a city.
Human resources experts said the new rule would improve social security for expats but also increase the burden on employers, which may result in a decrease in the number of foreign workers in the long term.
"The new regulation follows international practice as it grants foreigners the same social welfare and benefits as Chinese," said Wang Daben, an associate professor of East China Normal University's population research institute.
Employers must apply for social insurance for their foreign workers within 30 days of applying for their work permits. Only workers from countries that have signed social insurance agreements with China are exempt.
"The new regulation embodies equality," said Chris White, an American who has worked in the country for 10 years and is currently a senior director of a firm based in Shanghai.
"The measure makes me feel I'm no longer an outsider but a part of Shanghai," he said. "It will be very helpful to some young expats with low salaries ... but for most foreigners I think it's more symbolic."
He said few foreigners stay in the country until retirement age which means they could not get the pension.
He also said that many expats go to hospitals' VIP rooms rather than the public hospitals whose expenses will be covered by the medical insurance.
The regulation states that those who leave China before retirement age - 60 for men and 55 for women - can claim back their pension contributions. "The sum paid by employers goes to the social security pool," Wang said.
About 593,800 foreigners were working on Chinese mainland late last year.
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