Expecting in China: Employee Maternity Leave and Allowances
By Dezan Shira & Associates
Editor: Weining Hu
The State Council released and implemented the Provisions on Female Labor Protection under Special Circumstances (State Council Decree No. 619) in 2012, which extended maternity leave for female employees in China to 14 weeks (98 days) from the previous 90 days－just meeting the minimum maternity leave stipulated by the International Labor Organization (ILO).
However, maternity leave in China can vary widely by location, especially in terms of ‘late maternity leave’ as determined by the local government. It can also be quite complex for an employer to calculate how much maternity leave and allowance that female employees are entitled to. In this article, we explain maternity and paternity leave in China and detail the payment of maternity allowances.
Starting from the 12th week of pregnancy, a pregnant employee will need to go for an increasing number of prenatal check-ups, for which she is entitled to paid leave. These check-ups will be logged in the pregnancy handbook provided by the local Community Health Service Center.
Length of paid maternity leave
A Chinese female employee may take a 98-day paid maternity leave beginning at her discretion 15 days prior to childbirth. Leave may be extended by 15 days under special circumstances such as dystocia. If the employee gives birth to more than one child at a time, an additional 15-day maternity leave shall be given for each additional infant.
In addition, a Chinese female employee who gives birth to her first child at age 24 or older is regarded as a case of ‘late childbirth,’ and is therefore entitled to an additional ‘late maternity leave’ of roughly 30 days (this may vary widely by location, e.g. 45 days in Dalian).
After the abolition of the one-child policy in late 2015, many provinces changed the wording of ‘late maternity leave’ to ‘maternity rewards leave’ (生育奖励假). Despite the change of title, leave days remained the same in most provinces. However, as leave days and related policies vary by province, it is recommended to look up specific regulations with the relevant local authorities.
A foreign employee may also take a 98-day paid maternity leave, but is not eligible for late maternity leave. It should be noted that the 98-day leave includes working days, weekends, and national holidays, while the late maternity leave includes only working days and weekends.
Abortion and miscarriage
Furthermore, no less than 15 days of maternity leave shall be offered in cases of abortion after a pregnancy shorter than four months, and no less than six weeks of maternity leave in cases of miscarriage/abortion after a pregnancy longer than four months.
During maternity leave, a female employee shall receive a maternity allowance in lieu of salary. Generally, a Chinese female employee (assuming that the employee has participated in maternity insurance) is paid by the Social Security Bureau where the woman is registered. In determining the amount of maternity allowance, the Social Security Bureau will look at the employee’s monthly salary and the average monthly salary of all employees over the last 12 months.
The Bureau will pay whichever amount is higher, but no more than three times the average salary in the Bureau’s jurisdiction. In certain parts of China, such as Beijing and Shanghai, any amount above three times the local average must be paid by the employer. For example, the average monthly salary in Shanghai in 2015 was RMB 5,939, making the benchmark maternity allowance in Shanghai RMB 5,939 × 3 = RMB 17,817.
Comparing three different scenarios:
The maternity allowance shall also apply to foreign employees who have contributed to the maternity insurance scheme. Foreign and Chinese employees not participating in maternity insurance shall receive their full salary paid by the company.
A female employee shall also be granted at least one hour each day during work hours for breast-feeding during a one-year ‘breast-feeding period.’ In practice, companies tend to ask employees to work a full eight-hour day, and allow them to accumulate the extra hour toward vacation time. Most female employees prefer this approach as well.
The amount of time that a male employee can take as paternity leave largely depends on where the individual is registered for social security. In general, China’s statutory paternity leave does not exceed two weeks (14 days). For example, in Shanghai, according to the newest Shanghai Population and Family Planning Regulations promulgated in 2016, a male employee is entitled to a ten-day paternity leave in the case of late childbirth, seven days more than the old regulation. In Shenzhen, a male employee can enjoy a 15-day paternity leave if his wife is 23 or older.
Terminating a pregnant employee
In China, it is illegal to terminate a pregnant employee during her pregnancy, maternity leave, or breast-feeding period (which lasts until the infant is a year old). Further, if an employee gets pregnant during the term of her fixed-term contract, and the contract ends during the pregnancy, the contract shall be automatically extended (through a renewed end date or a second contract) until the end of the breast-feeding period.
For a consultation on the implications for your business of China’s statutes on maternity leave and allowances, please contact the HR and payroll professionals of Dezan Shira & Associates at firstname.lastname@example.org.
Editor’s note: This article was originally published on November 11, 2014, and has been updated to include the latest regulatory changes.
China Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Asia, including ASEAN, India, Indonesia, Russia, the Silk Road, and Vietnam. For editorial matters please contact us here, and for a complimentary subscription to our products, please click here.
Dezan Shira & Associates is a full service practice in China, providing business intelligence, due diligence, legal, tax, IT, HR, payroll, and advisory services throughout the China and Asian region. For assistance with China business issues or investments into China, please contact us at email@example.com or visit us at www.dezshira.com
Dezan Shira & Associates is a pan-Asia, multi-disciplinary professional services firm, providing legal, tax and operational advisory to international corporate investors. Operational throughout China, ASEAN and India, our mission is to guide foreign companies through Asia’s complex regulatory environment and assist them with all aspects of establishing, maintaining and growing their business operations in the region. This brochure provides an overview of the services and expertise Dezan Shira & Associates can provide.
Dezan Shira & Associates´ Silk Road and OBOR investment brochure offers an introduction to the region and an overview of the services provided by the firm. It is Dezan Shira´s mission to guide investors through the Silk Road´s complex regulatory environment and assist with all aspects of establishing, maintaining and growing business operations in the region.
In this edition of China Briefing, we guide readers through a range of topics, from the reasons behind foreign investors’ preference for the WFOE as an investment model, to managing China’s new regulations. We discuss how economic transformations have favored the WFOE, as well as the investment model’s utility, and detail key requirements that businesspeople need to examine before initiating the WFOE setup process. We then walk investors through the WFOE establishment process, and, finally, explain the new and idiosyncratic “Actual Controlling Person” regulation.