On 21 November 2012, the Ministry of Human Resources and Social Security issued for public comment draft regulations on maternity insurance. No indication was given as to when the ministry plans to issue the finalised regulations.
Under the draft regulations, companies should make maternity insurance contributions for all of their employees, and the contribution rate generally should not exceed 0.5%. Currently, the contribution rate in many jurisdictions is higher than 0.5% – for instance, in Shanghai and Beijing it is 0.8% – so if the draft regulations are passed in their current form, contribution costs should decrease in those cities.
As for the maternity allowance paid to an employee during her maternity leave, the draft regulations provide that the period during which the employee receives a maternity allowance should be in line with the extended maternity leave period in the recently amended Female Employee Special Protection Regulations; currently, many cities only pay out the allowance for 90 days, in line with the old maternity leave regulations. The draft regulations also reiterate that the maternity allowance should be calculated based on the company’s average monthly salary, in line with the Social Insurance Law; some cities currently still calculate the allowance based on an employee’s average monthly wage.
Business Law Digest is compiled with the assistance of Baker & McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker & McKenzie by e-mail at: Zhang Danian (Shanghai) [email protected]