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Human Resources and Payroll in China 2016-2017 (5th Edition) -
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During maternity leave, a female employee receives a maternity allowance in lieu of salary.
Generally, a Chinese female employee (assuming that they have participated in maternity
insurance for a certain period) is paid by the Social Security Bureau where they are registered.
In determining the amount of maternity allowance, the Social Security Bureau will look at the
average monthly salary of all employees in the company over the last 12 months (hereinafter
“company average salary”).
In cases where the company average salary is no more than three times the average salary in the
Bureau’s jurisdiction, the maternity allowance paid by the Bureau will be the company average
salary. In cases where the company average salary is over three times the average salary in the
Bureau’s jurisdiction, the maternity allowance will be three times the local average salary, and any
amount above three times of the local average must be paid by the employer.
In certain parts of China, such as Shanghai, if the maternity allowance paid by the Bureau is lower
than the average monthly salary of the employee over the last 12 months (hereinafter“employee
average salary”), the remainder is paid by the employer.
In addition, the maternity allowance is subjected to minimum standards in certain cities.
For clarity, we present the following scenario, which supposes that the employee is based in
Shanghai and gave birth to her baby in 2014:
Thematernity allowance also applies to foreign employees who have contributed to thematernity
insurance scheme. Foreign and Chinese employees not participating inmaternity insurance receive
their average salary over the past 12 months paid by the company.
Scenario 1
Scenario 2
Scenario 3
Employee average salary
RMB 8,000
RMB 8,000
RMB 30,000
Company average salary
RMB 10,000
RMB 20,000
RMB 20,000
Payment by Social Security
Bureau to employee
RMB 10,000
RMB 16,353*
RMB 16,353
Payment by company to
employee
0
RMB 3,647
RMB 13,647
*the average monthly salary in Shanghai in 2014 was RMB 5,451, making the benchmark maternity allowance in Shanghai
RMB 5,451 × 3 = RMB 16,353
.