Labor and Personnel Related Anti-epidemic Measures Launched by the Human Resources, Social Security and Financial Authorities

May 2022

Yanting Pei and Teresa Huang

On March 27, 2022, the Shanghai Municipal Human Resources and Social Security Bureau and the Shanghai Municipal Bureau of Finance jointly issued a circular to promulgate the Several Measures of the City on the Full Anti-epidemic Support in Areas of Human Resources and Social Security (hereinafter, the “Measures”) to introduce a number of policy measures on various tasks such as supporting enterprises to stabilize jobs, caring for front-line medical workers and related personnel, maintaining harmonious and stable labor relations, and optimizing human resources and social services.  The Measures provide institutional guarantee for the relief of the epidemic, especially the measures related to supporting enterprises to stabilize jobs and maintain labor relations, and deserve the attention of enterprises.

I. Measures to support enterprises to stabilize jobs and stabilize employment

In order to reduce the pressure of enterprises and stabilize employment, the Measures put forward six guarantees, including the following:

1. Continuing the implementation of the policy to reduce unemployment insurance and work injury insurance premium rates

This means that the implementation of 1% contribution rate for unemployment insurance continues, and the benchmark premium rates for work-related injury insurance for employers in Category 1 to Category 8 industries continue to be reduced by 20% based on the national industry benchmark rate.

2. Strengthening the policy of entrepreneurship support

This mainly includes two aspects.  One is to encourage entrepreneurship incubation demonstration bases to reduce or suspend the rents of the incubated enterprises; and the second is to allow entrepreneurial organizations or individuals affected by the epidemic to apply for an extension of repayment to the banks that have issued entrepreneurship guaranteed loans and to continue to enjoy subsidized interest support.

3. Enhancing employment apprenticeship policy protection

For the apprenticeship bases and the trainees participating in the apprenticeship, if the absence is caused by epidemic control, the days of absence will be counted as normal apprenticeship attendance days; if the apprenticeship is interrupted, the corresponding apprenticeship period and the living expenses and teaching allowances will be postponed; and in case the apprenticeship period is not completed, if the labor contract has been signed before December 31, 2022, the teaching allowances for the remaining period can still be enjoyed.

4. Supporting the employment sharing model

Enterprises are encouraged to share employment to alleviate employment issues.  For those who share employment with other enterprises during the epidemic, in addition to platform support and employment guidance, they continue to be supported corresponding employment subsidies.

5. Comprehensively strengthening employment services

Precise employment will be promoted through various measures, especially for key enterprises involved in national economy and the people’s livelihood.  A “one-to-one” working mechanism will be created for employment service specialists to assist enterprises in solving problems such as employee recruitment, labor transfer, skills training, labor relations, etc.

6. Enhancing subsidies for online vocational training

If an employer affected by the epidemic conducts various types of online vocational training for its employees related to its main business, it can enjoy online vocational training subsidies in accordance with relevant regulations (enterprises can refer to the Circular of the Shanghai Municipal Human Resources and Social Security Bureau and the Shanghai Municipal Bureau of Finance on Matters Related to Further Implementation of Online Vocational Training Subsidy Policy for Employees of Enterprises Affected by the Epidemic (Fu Jen She Gui [2021] No. 4).

II. Measures to maintain harmonious and stable labor relations

For labor relations that may be affected by various unstable factors due to the epidemic, the Measures point out that a balance should be struck between promoting the development of enterprises and safeguarding the rights and interests of employees, and encourage employers and workers to actively negotiate for labor relations issues with both sides understanding each other, helping each other, and overcoming difficulties together.

For the issue of wages and benefits during the epidemic, the Measures still encourage negotiation and propose the following handling principles:

1. Paying wages normally in case of forced isolation

This means that if a medical institution or the government implements quarantine measures on Covid-19 patients, pathogen carriers, suspected patients, and close contacts pursuant to law, resulting in the workers’ inability to provide services normally, the enterprise pays their wages during the quarantine period as if they provided their services normally.

2. Following the payment requirements for medical treatment and sick leave if treatment is still required at the end of the quarantine period

That means that after the end of the quarantine period, for workers who still need to stop working for treatment, the enterprise pays the wages of such employees pursuant to relevant requirements for the payment of sick employees who are in their medical treatment period.

3. For those who stop working or cannot provide normal labor services for being affected by the control measures, encouraging the handling of different circumstances based on negotiation.

This means that if an enterprise is suspended or shut down or if the workers cannot return to work due to other control measures taken by the government in accordance with law, the Measures encourage both the employer and employees to resolve wage and compensation issues by way of negotiation as much as possible based on the concept of helping each other and overcoming difficulties together and according to different specific circumstances.

Specifically, if an enterprise is affected by the epidemic and needs to suspend its operation or production, it can first determine the standard of wage payment through democratic consultation with the workers’ congress, labor union, or employee representatives.  In case no agreement can be reached, if the suspension occurs in one wage payment cycle, the wages for that month should still be paid normally; if the suspension exceeds one wage payment cycle, the wages of the workers who have provided normal labor services in that month will be paid by a standard not lower than the minimum wage payment standard in Shanghai; and if normal labor services are not provided, living expenses may be paid by mutual agreement [1].

If the employees cannot provide normal labor services due to the control measures, it is recommended that the enterprise and the employees reach an agreement on wage adjustment, rotating shifts, shortening working hours, working from home, telecommuting, etc. during the epidemic prevention and control period to balance the interests of all parties and resolve conflicts flexibly[2].  It is recommended to not to rescind the labor contract on the ground of absenteeism without agreement[3].

In addition, the Measures also point out that corresponding periods may be postponed if the work-related injury application and examination are undermined due to the impact of the epidemic, and that enterprises that need to handle talent, personnel, social insurance, and other business may do so online through the “integrated government service” platform, the “Shanghai Human Society” APP, 12333 Hotline, WeChat official accounts, etc.

Enterprises may be under pressure in various aspects due to the epidemic, but as pointed out in the Measures, they should still work with their employees to understand each other, help each other, and overcome difficulties together.  In addition, they are supposed to strive to adjust employment and wages and stabilize employment through negotiation and do not lay off employees easily.  If there is shared employment, it is recommended to negotiate with the seconding unit for wage payment and social insurance arrangements to protect the interests of workers.  In addition, enterprises can also pay attention to various government subsidies to relieve their urgent needs.  Although the late spring coldness is cold, still it is already spring, which will surely usher in long-lasting warmth after this.

[1] See Article 4 of the Guiding Opinions of the Shanghai High People’s Court and the Shanghai Municipal Human Resources and Social Security Bureau on the Handling of Labor Dispute Cases Affected by the Epidemic (Fu Gao Fa [2020] No. 203)

[2] See Article 5 of the Several Opinions of the Shanghai High People’s Court on Judicial Services to Guarantee Epidemic Prevention and Control and Social and Economic Development (March 31, 2022)

[3] See Article 5 of the Opinions of the Shanghai Higher People’s Court and the Shanghai Municipal Human Resources and Social Security Bureau on Guidance on the Handling of Labor Dispute Cases Affected by the Epidemic (Hu Gao Fa [2020] No. 203)