Economy
Foreign workers to get equal social insurance benefits
By Wang Qian (China Daily)
Updated: 2010-10-30 09:12
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BEIJING - Foreign employees in China will be entitled to the same social insurance benefits as Chinese nationals after the top legislature adopted a law on Thursday that is being seen as a major sign of the country's wider economic and social openness.
The Social Insurance Law, which was adopted by the Standing Committee of the National People's Congress (NPC), will take effect in July 2011.
"China's economy and society are opening up more and more. Such a regulation follows international practice and gives equal national treatment to foreigners working in the country," Hu Xiaoyi, vice-minister for human resources and social security, said during a news conference held by the NPC Standing Committee on Thursday.
The law specifies that all citizens have a right to five forms of insurance: basic endowment insurance, basic medical insurance, worker injury insurance, unemployment insurance and maternity insurance.
The five forms of insurance, paid for by individuals, employers and the government, will accumulate trillions of yuan in deposits.
China plans to spend 5.74 trillion yuan ($857.89 billion) by 2020 on an all-round social welfare system to improve people's livelihoods, according to the China Development Research Foundation, a government think tank.
Provisions relating to social insurance for foreigners working in China are also included in the new law.
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The law says that companies will pay worker injury insurance for employees at a rate to be decided by the State Council, or the cabinet, depending on how dangerous their jobs are.
Employees who get injured physically or mentally because of work will receive employment injury insurance, according to the law.
The law overcomes many of the obstacles under the old regulations, which had an effect on the movement of the migrant population. For example, it says that a new medical payment system should be established to allow medical insurance to be paid into one place and drawn upon in another.
But the law does not say how many insurance types will be available to foreign workers, compulsorily or optionally.
Currently, most foreign workers in China can enjoy worker injury insurance and basic medical insurance in big cities such as Beijing and Shanghai, said Cui Yana, a Shanghai-based lawyer specializing in labor disputes.
But insiders told China Daily that most businesses and State-owned companies in Beijing do not pay any kind of insurance for their foreign employees. They choose instead to reimburse employees for such things as medical bills, because that costs less every year.