Regulation of Shenzhen Economic Zone on Social Endowment Insurance for Employees of Enterprises

· Area of Law： Insurance Personnel Trade Unions

· Level of Authority： Regulations of Special Economic Zones

· Date issued：07-26-2006

· Effective Date：01-01-1999

· Status： Effective

· Issuing Authority： Guangdong Province

Regulation of Shenzhen Economic Zone on Social Endowment Insurance for Employees of Enterprises
(Adopted during the 27th Session of the Standing Committee of the 2nd Shenzhen Municipal People's Congress on October 27, 1998, revised for the first time according to the Decision on Amending the Regulation of Shenzhen Special Economic Zone on Social Endowment Insurance for Employees of Enterprises at the 3rd Session of the Standing Committee of the 3rd Shenzhen Municipal People's Congress on December 22, 2000, and revised for the second time according to the Decision on Amending the Regulation of Shenzhen Special Economic Zone on Social Endowment Insurance for Employees of Enterprises at the 7th Session of the Standing Committee of the 4th Shenzhen Municipal People's Congress on July 26, 2006)
Chapter I General Provisions
Article 1 With a view to guaranteeing the basic living needs of employees of enterprises after retirement, this Regulation is formulated in accordance with the relevant laws and regulations, and by taking into consideration the actual circumstances of Shenzhen Special Economic Zone (hereinafter referred to as the SEZ).
Article 2 Shenzhen Special Economic Zone adopts the social endowment insurance system. The social endowment insurance as mentioned in this Regulation includes the basic endowment insurance, local supplemental endowment insurance, enterprise annuities and other multi-layer endowment insurance.
The Municipal People's Government (hereinafter referred to as the Municipal Government) shall establish the basic endowment insurance and local supplemental endowment insurance. It shall encourage and support enterprises and their employees to buy the endowment insurance in the forms of enterprise annuities and personal savings.
Article 3 The term “basic endowment insurance” as mentioned in this Regulation shall apply to enterprises (including public institutions administrated as enterprises, and private non-enterprise entities, the same below) in the SEZ and their employees.
The term “local supplementary endowment insurance” as mentioned in this Regulation shall apply to enterprises in the SEZ and their employees who are permanent residents in this Municipality who shall buy basic endowment insurance and local supplementary endowment insurance according to this Regulation.
The enterprises and their employees shall, under this Regulation, buy the basic endowment insurance and local supplemental endowment insurance.
Article 4 The social endowment insurance shall follow the principles of combining fairness with efficiency, making the rights correspond to the obligations and making the guarantee level suitable for the level of development of social productivity.
Article 5 The basic endowment insurance shall be managed by combining the social mutual aid with the individual account.
Article 6 The municipal labor and social security administrative department (hereinafter referred to as the municipal labor and social security department) shall be responsible for the social endowment insurance for employees of enterprises.
The relevant departments of the Municipal Government shall, under their respective functions, help the municipal labor and social security department in the endowment insurance work.
The municipal social insurance agency shall be responsible for the concrete social insurance affairs relating to the basic endowment insurance and local supplemental endowment insurance.
The sub-district offices shall be responsible for the socialization management services for the retirees within their respective jurisdiction.
Chapter II Collection of Endowment Insurance Premium
Article 7 The basic endowment insurance fund shall be derived from the basic endowment insurance premiums and their interests, late fee for the basic endowment insurance premium, proceeds from lawful operation of the basic endowment insurance fund, fiscal subsidies and other revenues.
The local supplemental endowment insurance fund shall be derived from the local supplemental endowment insurance premium and its interest, late fee for the local supplemental endowment insurance premium, proceeds from lawful operation of the local supplemental endowment insurance fund, fiscal subsidies and other revenues.
Article 8 The social endowment insurance premium shall be based on the total amount of the monthly wage of each employee (hereinafter referred to as the wage base). However, if the total amount of the monthly wage of an employee exceeds the average monthly wage of the in-service employees of this Municipality of the previous year by 300%, the excessive part shall be excluded in the calculation of social endowment insurance premium. If the total amount of the monthly wage of employee who is a permanent resident in this Municipality is lower than the average monthly wage of the in-service employees of this Municipality of the previous year by 60%, the basic endowment insurance premium shall be calculated at 60% of the average monthly wage of the in-service employees of this Municipality of the previous year. The wage base for the calculation of the basic endowment insurance premium of an employee who is not a permanent resident of this Municipality shall not be lower than the minimum monthly wage in this Municipality.
Article 9 The payments for basic endowment insurance premium shall be made at 18% of the wage base of an employee, of which the employee himself shall pay 8% of the wage base and the enterprise shall pay 10% of the wage base.
The payment for local supplemental endowment insurance premium shall be made by the enterprise at 1 % of the wage base.
Article 10 All enterprises and employees shall pay the endowment insurance premium to the municipal social insurance agency on a monthly basis, of which the part to be paid by the employees themselves shall be withheld by the enterprises.
Article 11 The social endowment insurance premium shall be collected by a bank upon entrustment of an enterprise.
Article 12 The municipal social insurance agency shall include the basic endowment insurance premiums paid by enterprises and employees in the personal accounts and the mutual aid fund at the following rates, respectively:
(1) 8% of the wage base shall be put into the personal accounts of the employees;
(2)The rest shall be put into the mutual aid fund.
Article 13 For an employee who was transferred into this Municipality before July 31, 1992, his consecutive length of service prior to July 31, 1992 (except for the years in which he has not bought endowment insurance under the provisions of the Municipal Government) shall be regard as the payment years.
Article 14 Any employee, who was transferred to this Municipality after August 1, 1992, will no longer make up any payment to the mutual aid fund or to his personal account.
For an employee who was transferred to this Municipality during the period from August 1, 1992 to June 30, 1996, if he has made up a payment to the mutual aid fund, the said payment shall be shifted to his personal account.
Article 15 For an employee who was transferred to this Municipality after July 1, 1996, if he is beyond the limit of the Municipal Government on the age of worker or cadre to be transferred, a payment shall be made for the overage endowment insurance premium. After the payment is made, his consecutive length of service prior to his transfer into this Municipality shall be regarded as the payment years.
The measures and criterions for the payment of overage endowment insurance premium shall be separately formulated by the Municipal Government.
The overage endowment insurance shall be paid by the transfer-in entity and shall be included in the local supplementary endowment insurance fund.
Article 16 For a person who is demobilized, has retired or transferred to civilian work from the army, or for a staff employee of the army, if his length of military service (length of service) is consecutive, it shall be deemed as payment years, unless it is otherwise provided for by the army.
Article 17 With 90 days after an enterprise obtains a business license, it shall go through formalities for the registration and purchase of the endowment insurance in the municipal social insurance agency.
Article 18 In the case of assignment, merger or split-up of an enterprise, the endowment insurance premium in arrears and its late fee shall be paid by the post-modification enterprise. If it is stipulated otherwise by the enterprise, it shall be paid the enterprise stipulated.
In the case of bankruptcy or dissolution of an enterprise, the endowment insurance premium in arrears and its late fee shall be listed into the first sequence of payment to be made.
Article 19 The endowment premium to be paid by an enterprise shall be disbursed as a cost. The endowment insurance premium to be paid by an employee shall be paid prior to tax.
Article 20 The accumulative amount in the personal account of an employee shall have interest according to the interest rate for the deposit of the bank of the same period. The interest shall be totally transferred to the personal account of the employee.
Article 21 Every year, the municipal social insurance agency shall regularly conduct annual inspections over the payment of endowment insurance premiums made by enterprises and shall issue social insurance annual inspection certificates to those who pass the annual inspection.
When an enterprise handles the formalities for employment, transfer of a worker or transfer of a cadre, it shall provide the social insurance annual inspection certificate issued by the municipal social insurance agency. When an enterprise rents or purchases any house with meager profit, it shall provide the social insurance annual inspection certificate.
Article 22 When the municipal social insurance agency checks the payment of endowment insurance premium made by an enterprise, the enterprise shall faithfully provide the roster of the employees, wage forms and other relevant materials.
Chapter III Endowment Insurance Treatments
Article 23 An employee (including a person who is out of work) who is entitled to fetch pensions on a monthly basis shall meet the following requirements simultaneously:
(1)He attains the retirement age or meets the requirements of the state for quit of working; and
(2)For a permanent resident of this Municipality, he began to work prior to July 31, 1992 and his payment years in accumulation reach 10 years. For a permanent resident of this Municipality, he began to work after August 1, 1992 and his payment years in accumulation reach 15 years. For an employee who is not a permanent resident of this Municipality, his payment years in accumulation reach 15 years.
Article 24 An employee who meets the conditions of Article 23 of this Regulation may go through the formalities for the obtainment of pension in the municipal social insurance institution and enjoy the endowment insurance treatments as determined by the municipal social insurance agency.
Article 25 The basic endowment insurance treatments include the basic pension, funeral allowances, lump-sum pension to the dependant relatives, basic medical insurance premium and local supplemental medical insurance premium.
Article 26 For an employee who began to work prior to July 31, 1992 and retired after July 1, 2006, his monthly basic pension for retirement is composed of:
the pension base ＋ the pension in his personal account ＋ the transition pension ＋ adjustment amount
Article 27 For an employee who began to work after August 1, 1992 and shall retire prior to December 31, 2011, his monthly basic pension for retirement is composed of:
the pension base ＋ the pension in his personal account ＋ the transition pension
If an employee began to work during the period from August 1, 1992 to December 31, 1998 and will retire after January 1, 2012, the composition of his monthly basic pension for retirement shall be in line with Article 28.
Article 28 For an employee who began to work after January 1, 1999, his monthly basic pension upon retirement is composed of:
the pension base ＋ the pension in his personal account
Article 29 The pension base, the pension in an employee's personal account, transition pension, adjustment amount, transition adjustment amount shall be calculated and paid as follows:
(1)The pension base shall be calculated at 1% of the average amount of the summation of the average monthly wage of the in-service employees of this Municipality of the year prior to the retirement and the indexing monthly payment wage of the employee for each full year of payments.
(2)The pension in the personal account shall be calculated by dividing the accumulative amount in the personal account at the retirement by the number of months as provided for by the state;
(3)The adjustment amount shall be 300 yuan;
(4)The transition adjustment amount shall be 250 yuan each month if he retires in 2007, or 50 yuan less successively for each year if he retires thereafter; and
(5) The methods for calculating the transition pension and the indexing monthly payment wage of employee shall be formulated separately by the Municipal Government.
The pension base, transition pension, adjustment amount and transition adjustment amount shall be paid from the mutual aid fund of the basic endowment insurance. The personal account pension shall be paid from the personal account; after all the money in the personal account is paid off, it shall be paid from the mutual aid fund of the basic endowment insurance.
Article 30 The local supplemental endowment insurance treatments include the transition subsidy and other subsidies. The concrete criterions shall be separately provided for by the Municipal Government.
Article 31 For a retiree who has consecutive length of service prior to July 31, 1992 as recognized by this Municipality, he shall be entitled to enjoy the subsidies for the length of service. The concrete measures shall be separately formulated by the Municipal Government.
Article 32 When a returned overseas Chinese retires, if the summation of his monthly basic pension and the local supplemental endowment treatments is lower than the average monthly wage of the in-service employees of this Municipality of the previous year, he shall be given an extra subsidy every month, which is at 5% of the average monthly wage of the in-service employees of this Municipality of the previous year. The extra subsidy shall be paid from the basic endowment insurance fund.
Article 33 For an employee who retired prior to June 30, 2006, the treatments given to him by the social insurance agency will not be re-calculated and should be paid from the basic endowment insurance fund.
July 1, 2006-June 30, 2011 shall be the five-year transition period. For an employee who retires during this period, if the endowment insurance treatments calculated under the new measures are lower than the endowment insurance treatments calculated under the former measures, he shall be given the endowment insurance treatments calculated under the former measures.
If the endowment insurance treatments calculated under the new measures are higher than the endowment insurance treatments calculated under the former measures and if an employee retires during the period from July 1, 2006 to June 30, 2011, the employee shall, on the basis of the treatments calculated under the former measures, be given an extra treatment at a certain proportion of the difference between the treatments calculated under the new measures and those calculated under the former measures. The concrete proportion shall be separately formulated by the Municipal Government. For an employee who retires after July 1, 2011, he shall be given the endowment insurance treatments calculated under the new measures.
To calculate the pension base and transition pension within the transition period under the former measures, the average monthly wage of the in-service employees of this Municipality of the previous year shall uniformly refer to the average monthly wage of the in-service employees of this Municipality of the year 2005.
Article 34 For an employee who took part in the revolutionary work prior to September 30, 1949, he shall be given the endowment insurance treatments by referring to the treatments enjoyed by similar personnel of the government organs of this Municipality.
Article 35 For a retiree who enjoys the endowment insurance treatments on a monthly basis, his basic medical insurance premiums and local supplementary medical insurance premium shall be paid from the mutual aid fund of the basic endowment insurance.
Article 36 One adjustment shall be made to basic endowment insurance treatments to the retirees in July every year. The concrete adjustment shall be determined according to the increase of the average monthly wage of the in-service employees of this Municipality of the previous year and shall be submitted by the municipal labor and social security department to the Municipal Government for approval.
Article 37 For an employee who has reached the retirement age as provided for by the state but does not meet the requirement for the number of payment years, he may apply for obtaining a lump-sum of the accumulative amount of money in his personal account and a lump-sum of living expense allowance to terminate the endowment insurance relationship in this Municipality.
The criterion for the lump-sum of living expense allowance for an employee who is a permanent resident of this Municipality shall be based on the average monthly wage of the in-service employees of this Municipality of the year prior to his retirement, the amount of the said monthly wage for each full year of payment of the endowment insurance premium.
The criterion for the lump-sum of living expense allowance for an employee who is not a permanent resident of this Municipality shall be based on minimum monthly wage of this Municipality, the amount of the said monthly wage for each full year of payment of the endowment insurance premium.
Article 38 For an employee who leaves this Municipality prior to his retirement, his endowment insurance relationship shall be handled through the following methods:
(1)If the endowment insurance relationship may be transferred, the endowment insurance relationship may be transferred according to the relevant provisions to terminate the endowment insurance relationship in this Municipality;
(2)If it is unable to transfer the endowment insurance relation, he may apply for obtaining the accumulative amount of money in his personal account to terminate the endowment insurance relationship in this Municipality; or
(3)If the endowment insurance relationship continues to remain in this Municipality and if he returns to this Municipality to work and continues to pay the endowment insurance premium, his actual payment years and the amount of money in his personal account may be calculated accumulatively. If his payment years do not conform to the payment years as prescribed in Article 23 (2) of this Regulation, he may, once and for all, draw the accumulative amount of money in his personal account and may, in accordance with Article 37 of this Regulation, obtain a lump-sum of living expense allowance to terminate the endowment insurance relationship in this Municipality.
Article 39 For an employee who goes abroad or goes to Taiwan, Hong Kong, Macao for permanent residence before he retires, if he applies for terminating the endowment insurance, the accumulative amount of money in his own personal account for endowment insurance shall be totally refunded to him and the endowment insurance relationship shall be terminated. If his endowment insurance relations continues to remain in this Municipality and if he returns to work in this Municipality and continues to pay the endowment insurance premiums, his actual payment years and the amount of money in his personal account may be calculated accumulatively.
Article 40 If an employee or retiree deceases, the accumulative amount of money in his personal account may be inherited according to law.
Article 41 Where a retiree who enjoys the monthly pension deceases, or where an in-service employee who has bought the basic endowment insurance deceases for a non-work-related reason, his qualified dependant relatives may obtain the funeral allowances and a lump-sum pension.
The criterions for the funeral allowance and lump-sum pension are as follows:
(1)The funeral allowance shall be 3 times the average monthly wage of the in-service employees of this Municipality of the previous year;
(2)The lump-sum pension shall be based on the average monthly wage of the in-service employees of this Municipality of the previous year at the time of his death. If he has only one dependant relative, the payment shall be 6 times the aforesaid base. If he has two dependant relatives, the payment shall be 9 times the aforesaid base. If he has three dependant relatives or more, the payment shall be 12 times the aforesaid base.
The funeral allowances and the lump-sum pension shall be paid from the basic endowment insurance fund.
Article 42 The pension shall be paid by socialized agencies.
When a retiree goes through the formalities for obtaining the pension, he shall provide a bank account to the municipal social insurance agency.
The municipal social insurance agency shall, in accordance with the relevant provisions, regularly pay him the pension in full amount.
Article 43 Where any employee or retiree deceases, his relative(s) shall, within 30 days after his death, declare his death to the municipal social insurance agency.
Chapter IV Administration and Supervision over the Endowment Insurance Fund
Article 44 The opening of accounts for the incomes and expenses of endowment insurance fund shall be subject to the examination and approval of the municipal finance department.
Article 45 The endowment insurance fund shall be integrated into the special account of the municipal finance department. It shall be subject to separate management of incomes and separate management of expenses and shall be used for the special purpose. It shall not be occupied or misappropriated.
Article 46 The municipal finance department shall, jointly with the municipal labor and social security department, establish systems for the budgets and final account of the endowment insurance fund according to the relevant provisions of the state.
The municipal finance department shall report to the Standing Committee of the Municipal People's Congress the information about the execution of the budgets for the incomes and expenses of the endowment insurance fund as well as the final account thereof.
Article 47 A social insurance supervisory institution, which is composed of the government representatives, enterprise representatives, labor union representatives and representatives of other sides, shall be established. The number of government representatives in the social insurance supervisory institution shall not exceed 1/4 of the total number of the representatives.
The composition, power, rules of procedure of the social insurance supervisory institution shall be provided by the articles of association thereof and the articles of association shall be subject to the approval of the Municipal Government.
The social insurance supervisory institution shall conduct supervision over the implementation of the laws, regulations and rules regarding the endowment insurance, as well as over the incomes, expenses, uses and management of the endowment insurance fund.
Article 48 The municipal audit organ shall regularly audit the financial incomes and expenses of the endowment insurance fund every year and shall report the audit results to the social insurance supervisory institution.
The municipal labor and social security department shall establish a sound internal audit and supervision system for the endowment insurance fund.
The municipal finance department shall, jointly with the municipal labor and social security department, establish a sound finance system for the endowment insurance fund.
The municipal social insurance institution shall establish an inquiry system for the social insurance premiums so as to facilitate the consulting by the enterprises and employees of the payments of premiums.
Article 49 An enterprise shall declare to the municipal social insurance agency the endowment insurance premium payment wage on the basis of the total amount of the actual wages of its employees and shall monthly notify its employees of the payment of endowment insurance premiums made by it. The employees have the right to consult the municipal social insurance agency for the information about the payment of endowment insurance premiums.
Article 50 Where an enterprise defaults the payment of, underpays or fails to pay the endowment insurance premium by violating this Regulation, the employees may, within 2 years after they know or should know that their right has been impaired, file a complaint or expose the enterprise to the municipal labor and social security department or to other relevant departments, or may directly file an arbitration application to the labor arbitration institution.
Article 51 The municipal social insurance institution shall regularly announce to the general public every year the information about the raising, payment, balance and use of the endowment insurance fund.
Chapter V Legal Liabilities
Article 52 Where any enterprise fails to pay the endowment insurance premium under the relevant provisions, the municipal labor and social security department shall issue to it a notice of demand for payment, ordering it to make a payment within a time limit. If the said enterprise fails to make a payment within the time limit, it shall not only make up the amount due, but also pay an extra late fee at the rate of 0.2% per day from the day when the said amount is due.
Article 53 Where any enterprise violates this Regulation by failing to report the right number of employees for whom it should buy the endowment insurance or the right payment wage, failing to go through the endowment insurance registration or refusing to provide the relevant materials, the municipal labor and social security department shall order it to make a correction within a time limit. If the enterprise fails to do so within the said time limit, the municipal labor and social security department may fine it 50, 000 yuan and may fine the directly liable person-in-charge and other directly liable persons not less than 10, 000 yuan but not more than 30, 000 yuan.
Article 54 Where any entity or individual interferes with or hampers the execution of official business by the municipal labor and social security department, social insurance agencies and their functionaries, the public security organ shall punish it (him) in accordance with the Public Security Administrative Punishments Law of the People's Republic of China .
Article 55 If, after the death of a retiree, his relatives fail to make a declaration within the prescribed time limit and as a result, the endowment insurance treatments enjoyed are more than those that the said retiree should enjoy, the municipal social insurance agency shall demand the return of the excessive endowment insurance treatments.
If anyone obtains any endowment insurance treatments by deceitful means or obtains any endowment insurance treatments more than he should enjoy by trickery, the municipal social insurance agency shall demand the return of the endowment insurance treatments or excessive endowment insurance treatments and shall impose a fine of the same amount of the said endowment insurance treatments or excessive endowment insurance treatments on the entity or individual who commits the deceitful act.
Article 56 Where any entity or individual violates this Regulation by misappropriating and occupying the endowment insurance fund, the relevant person-in-charge and directly liable persons shall be given an administrative sanction.
Article 57 Where any of the functionaries of the municipal labor and social security department and the social insurance agencies abuses his power, neglects his duties, seeks private benefits, extorts bribes or seeks private benefit at public expense, the entity for which he works or the relevant department shall give him an administrative sanction. If any loss is caused to the enterprise and/or to the employees, he shall be liable for the compensation.
Article 58 Where any party concerned refuses to accept the concrete administrative act made by the municipal labor and social security department, he may apply for an administrative reconsideration or lodge an administrative lawsuit.
Where any party concerned does not apply for an administrative reconsideration, nor lodges an administrative lawsuit against a concrete administrative act, nor performs the administrative act, the municipal labor and social security department may apply to the people's court for enforcement.
Chapter VI Supplementary Provisions
Article 59 The term “retiree” as mentioned in this Regulation includes the retirees and persons who quit working.
The term “total amount of wage” as mentioned in this Regulation shall be calculated in accordance with the relevant provisions of the State. The average monthly wage of the in-service employees of this Municipality of the previous year and the minimum monthly wage shall conform to the amounts publicized by the Municipal Government and the municipal statistical department.
The term “payment years” as mentioned in this Regulation refers to the summation of the actual number of payment years of an employee in this Municipality and the number regarded as payment years. The term “number regarded as payment years” as mentioned in this Regulation refers to the former consecutive length of service of an employee recognized by the state before he is transferred to this Municipality upon approval of the labor or personnel department of this Municipality and buys social insurance.
The term “former measures” as mentioned in this Regulation refers to the measures for the calculation and payment of endowment insurance treatments prior to June 30, 2006. The new measures shall refer to those after July 1, 2006.
Article 60 Where an enterprise or employee pays the endowment insurance premium and calculates the endowment insurance treatments, the average monthly wage of the in-service employees of this Municipality of the previous year involves herein shall be calculated and paid according to the average monthly wage of the in-service employees of this Municipality of the previous two years if the premium is calculated and paid in the first half of the year, or it shall be calculated and paid according to the average monthly wage of the in-service employees of this Municipality of the previous year if it is calculated and paid in the second half of the year.
Article 61 The endowment insurance in Baoan and Longgang Districts shall be implemented by referring to this Regulation.
The state organs, public institutions and the employees and temporary employees who have established labor relationship with them shall implement this Regulation.
The endowment insurance relating to urban individual economic organizations and their employees, free employees with permanent residence in this Municipality shall be implemented by referring to this Regulation.
The endowment insurance relating to the persons from Taiwan, Hong Kong, Macao as well as aliens shall be governed by the relevant provisions of the state.
Article 62 The detailed rules for the implementation of this Regulation shall be separately formulated by the Municipal Government.
Article 63 This Regulation shall come into force as of January 1, 1999.