Foreign employees in China can participate in Social Insurance after going through employment procedures and obtaining corresponding employment certificates.
Both the company and the employee shall contribute to the payment. The contribution is calculated based on the monthly salary received by the employees and the rates for different types of insurance varies.
On September 6, 2011, the Ministry of Human Resources and Social Security issued the Interim Measures for the Participation of Foreigners Employed in China in Social Insurance (the Measures) which came into effect on October 15, 2011.
The Measures specifies that employers who employ foreigners shall, within 30 days of the date on which the employment certificate is handled, make arrangements for the foreigners to participate in social insurance. Foreigners employed in China, after going through employment procedures and obtaining corresponding employment certificates, shall participate in social insurance for employees, including basic endowment insurance for employees, basic medical insurance for employees, work-related injury insurance, unemployment insurance and maternity insurance.
The payment of the social insurance for foreigners shall be made on a monthly basis according to the monthly salary received by the foreign employee. Both the company and the employee shall contribute to the payment.
The rates are as follows:
- Basic endowment insurance
Company contribution = 22%
Employee Contribution = 5%
- Basic medical insurance
Company contribution = 12%
Employee contribution = 2%
- Unemployment insurance
Company contribution = 2%
Employee contribution= 1%
- Work-related injury insurance
Company contribution = 0.5%
Employee contribution = 0%
- Maternity insurance
Company contribution =0.5%
Employee contribution = 0%
The contribution from the foreign employee will be deducted from his monthly salary by the company and paid to social insurance bureau. In addition, the basis of contribution for foreign employee, mostly like local Chinese employee, possibly is capped at triple of the average local employee's salary which is issued by local authority every year.
In the event the foreign employee leaves China, he can choose to keep the social insurance account and the payment can be continued if he is back to China for work in the further again. However, if he does not want to keep the account, he can apply for cancelling. In that case, the balance in his personal social insurance account can be withdrawn.
Foreigners employed in China refer to people without Chinese nationality who have obtained the Employment Certificate for Foreigner, the Certificate of Foreign Expert, the Certificate of Permanent Foreign Correspondent and other employment certificates and residence certificates for foreigners in accordance with the law, possess the Permanent Residence Certificate for Foreigner, and have been employed in China in accordance with the law.