Social security is paid according to the minimum contribution base
Is it illegal?
Minimum wage≠ social security contributions.
For example:
Beijing's minimum wage in 2023 is 2,320 yuan, however, Beijing's minimum social security contribution in 2023 is 6,326 yuan.
According to the provisions of the Notice on Issues Concerning the Standardization of Social Insurance Payment Base (Lao Social Insurance Center Letter [2006] No. 60):
The social security payment base of employees is generally determined according to the average monthly salary of employees in the previous year (or the salary of individuals in the previous month), and the higher the salary of employees, the higher the social security payment base will be.
At the same time, the document sets an upper and lower limit on the payment base, specifically:
- Lower limit: If the payment base is lower than the minimum payment base (60% of the local average wage), social security will be paid according to the minimum payment base.
- Upper limit: If the contribution base is higher than the maximum contribution base (300% of the local average salary) stipulated by the local government, social security will be paid according to the maximum contribution base.
Therefore, it is illegal to pay social security according to the local minimum payment base, and the employee's social security payment base needs to be determined according to the average salary of the employee in the previous year.
To be clear, the social security contribution base for new employees is not arbitrary.
The "Interim Measures for the Management of Personal Accounts of Basic Pension Insurance for Enterprise Employees" clearly states that new employees shall be paid based on the monthly salary of the starting salary, and the payment base of employees who are reemployed after unemployment shall also be based on the monthly salary of the starting salary as the payment base of the current year.
To summarize the principle of base verification: the base accounting of old employees is approved according to the average monthly salary of the previous year, and the new employees are approved according to the salary of the first month of entry, that is, the starting salary of the first month of the newcomer, the average monthly salary of the elderly in the previous year, and the upper and lower limits of the social level are intercepted to be approved.
Failure to pay social security in full
Can an employee claim compensation for resignation?
1. Economic compensation shall be paid
Shenzhen
Original Policy:
https://www.szcourt.gov.cn/article/30002510
The guidance makes it clear that:
If the employer fails to pay social insurance premiums for the employee in accordance with the law, the employee shall request the employer to pay the social insurance premiums in accordance with the law, and if the employer fails to pay the social insurance premiums within one month from the date of the employee's request, the employee shall have the right to terminate the labor contract and the employer shall pay economic compensation, but the payment period of the economic compensation shall be calculated from January 1, 2008.
The specific adjudication cases can be found at:
A labor dispute case between a security company in Shenzhen and Ye
The focus of the dispute: whether the employer fails to pay the social insurance premiums in full, whether the employee can claim the forced termination of the labor contract and claim support for economic compensation.
Final judgment: AVIC Security Company paid Ye Cheng RMB 51,669.29 in severance for terminating the labor contract.
Basis of the judgment: Article 15 of the Regulations on the Promotion of Harmonious Labor Relations in the Shenzhen Special Economic Zone stipulates that if an employer fails to pay social insurance premiums for its employees in accordance with the law, the employees shall request the employer to pay them in accordance with the law, and if the employer fails to pay the social insurance premiums within one month, the employee may terminate the labor contract and the employer shall pay economic compensation in accordance with the law.
Tianjin
According to the documents of Tianjin, if the social security payment base does not comply with the law, as long as the unit is at fault, it needs to pay economic compensation.
The Tianjin High People's Court issued the Guidelines for the Trial of Labor Dispute Cases in Tianjin Courts, which clarifies that:
[Application of Article 38 of the Labor Contract Law: Forced resignation without paying social security premiums in accordance with the law]
If an employee terminates a labor contract on the grounds that the employer has not established a social insurance relationship, has stopped paying social insurance premiums without justifiable reasons, or the social insurance premium payment base does not comply with the provisions of the law, it falls under the circumstances stipulated in Article 38, Paragraph 1, Item 3 of the Labor Contract Law of the People's Republic of China.
2. No severance shall be paid
1. Beijing
Original Policy:
http://raj.beijing.gov.cn/cxk/gcvg/201912/T20191206_944294.html
The notice clarifies that:
Where an employee requests the employer to pay economic compensation on the grounds that the employer has failed to pay social insurance for him or her in accordance with the law, it shall be handled in two cases.
One is that if the employer fails to establish a social security account for the employee, or if the employee does not pay all the types of insurance despite the establishment of the social security account, the employee's request to terminate the labor contract and claim economic compensation shall generally be supported.
On the other hand, if the employer has established a social security account for the employee and the types of insurance are complete, but there are problems such as insufficient payment period and low payment base, the employee's claim for economic compensation for the termination of the labor contract will generally not be supported, and the employee's social security rights and interests can be realized through the employer's supplementary payment or compulsory collection by the social security management department.
2. Zhejiang Province
Two documents from Zhejiang Province make it clear that companies are not required to pay severance payments.
The Guiding Opinions on Several Issues Concerning the Handling of Labor Dispute Cases (Trial) issued by the Zhejiang Provincial Labor Dispute Arbitration Commission clearly states:
Where the employee requests to terminate the labor contract and request the employer to pay severance on the grounds that the employer has not paid the full amount or has already collected the social insurance premiums approved by the department,
Answers to Several Questions Concerning the Handling of Labor Dispute Cases by the Zhejiang Provincial Labor Arbitration Court: If an employer fails to pay labor remuneration in time and in full or fails to pay social insurance premiums in accordance with the law, can it be used as a reason for the employee to unilaterally terminate the labor contract?
If the employer fails to pay labor remuneration in full and in a timely manner or fails to pay social insurance premiums in accordance with the law due to its fault,
However, if the employer has evidence to prove that the calculation standard is unclear or controversial due to objective reasons, or because of business difficulties, reasonable reasons or with the approval of the employee, or the unpaid or deferred payment of social insurance premiums has been approved by the collection department, and the employee terminates the labor contract on the grounds that the employer has failed to pay labor remuneration in time and in full or has not paid social insurance premiums in accordance with the law, the employee's request for the employer to pay economic compensation shall not be supported.
It is illegal for the unit to pay social security like this!
In addition to the fact that it is illegal for the unit to pay social security to employees according to the minimum base, the following 6 misunderstandings of social security payment should also be avoided by enterprises and individuals.
Myth 1: Employees can voluntarily give up social security
The Labor Law, the Social Insurance Law, the Interim Regulations on the Collection and Payment of Social Insurance Premiums and other laws and regulations clearly stipulate that participation in social insurance and payment of social insurance premiums are mandatory provisions set by law for employers and employees, and employers shall apply for social security registration for their employees within 30 days from the date of employment.
Therefore, no matter what method or excuse the employer takes, and no matter how it agrees with the employee, as long as it fails to pay social insurance premiums for the employee in accordance with the law, it is an illegal act.
Image source: China News Network Weibo
Myth 2: You don't need to pay social security during the probation period
The Social Insurance Law clearly stipulates that an employer shall apply for social security registration for its employees within 30 days from the date of employment. If they fail to register for social insurance, the social insurance agency shall verify the social insurance premiums they should pay.
Therefore, enterprises must pay social security for employees during the probationary period.
Myth 3: If you don't sign a contract, you don't need to pay social security
In practice, some employers will refuse to pay social insurance for their employees on the grounds that they have not signed an employment contract, but as everyone knows, the determination of the employment relationship can not only depend on a paper contract, but also on the existence of an employment relationship between the individual and the employer, and the social security must be paid.
See the following figure for specific regulations:
Image source: official website of the Ministry of Human Resources and Social Security
Myth 4: The unit must pay social security for the legal representative
First of all, the legal representative is the person responsible for exercising civil rights and performing civil obligations on behalf of the company. The legal representative is a natural person, and whether the company can handle the basic pension insurance for the legal representative depends on whether the legal representative and the company constitute an employment relationship.
When the legal representative of the company (also known as the legal representative) forms an employment relationship with the company, he shall participate in the basic pension insurance for employees in accordance with the law.
When there is no employment relationship between the legal representative of the company and the company, according to the provisions of the Social Insurance Law, he is not subject to compulsory insurance participation in social insurance.
To sum up, whether or not to pay social security to the legal representative depends on whether there is an employment relationship.
Source: Ministry of Human Resources and Social Security website, China News Network Weibo, 51 Social Security Network, etc