On September 26, 2013, the PRC Ministry of Human Resources and Social Security promulgated a Provision on filing and payment of social insurance. Such Provision confirms the duty of the employers to pay social insurance funds (i.e. pension, health, work injury, unemployment and maternity) also on behalf of the employee as withholding agent (i.e. by deducing the relevant amounts from the employees’ salaries).

There Provisions also confirm that no individual or entity may intervene or refuse the payments: such clauses aim to rectify a common practice carried out by local PRC authorities in connection to payment of welfare contributions for foreign employees (we remind here that foreign employees re subject to payment of welfare contributions in accordance with Article 97 of the PRC Social Insurance Law) according to which payments of above contribution were refused due to the fact that the authorities haven’t envisioned proper administrative procedures to follow.

Finally, employers that do not timely pay such welfare contributions will be subject to a fine equal to 0.5‰/day for each day of delay.

The new Provisions will be in force from November1, 2013.


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