Answer: An employee who has lost their job must meet all the three conditions to be eligible for unemployment insurance: minimum one year of contribution of unemployment insurance before becoming unemployed, the termination being non-voluntary, and having registered for unemployment and actively seeking employment without success.1Article 45 of the Social Insurance Law of the People’s Republic of China in 2018 States that “an unemployed person who meets the following conditions shall receive unemployment insurance benefits from the unemployment insurance fund: (1) The employer and the unemployed person have paid unemployment insurance premiums for one year before the unemployment; (2) The employment is terminated by the unemployed person voluntarily; (3) The unemployed person has registered for unemployment and has job seeking requirements”.
The aforementioned non-voluntary termination refers to the terminations of employment contracts caused by: forced resignation of employees, proposition by employers, mutual agreement, expiration of employment contracts, or employer’s dissolution including bankruptcy or revocation, etc.2Article 16 of the Regulations on Unemployment Insurance of Guangdong Province in 2022Employees’ resignations or employees’ having already received pension insurance benefits do not constitute non-voluntary termination.
Employees who meet the aforementioned conditions receive unemployment insurance benefits in a lump sum payment rather than monthly after their unemployment. The calculation of unemployment insurance benefits involves multiplying the number of months, determined by the employee’s years of contribution, by the local standard of unemployment insurance benefits. If the employee is unemployed again, the entitled number of months shall be recalculated based on the new contribution years. The accumulative number of months of unemployment insurance benefit for which each employee may receive shall not exceed 24 months.3Article 46 of the Social Insurance Law of the People’s Republic of China in 2018. “If the employer and the unemployed person have paid contributions for more than one year but less than five years before unemployment, the maximum period for receiving unemployment insurance benefits shall be 12 months; if the employer and the unemployed person have paid contributions for more than five years but less than ten years, the maximum period for receiving unemployment insurance benefits shall be 18 months; If the accumulative payment is more than 10 years, the maximum period for receiving unemployment insurance benefits shall be 24 months. In case of re-unemployment after re-employment, the time of payment shall be recalculated, and the period of receiving unemployment insurance benefits shall be combined with the period of receiving unemployment insurance benefits that should have been received but not yet received in the previous unemployment, and the maximum period shall not exceed 24 months.” Article 47, “The standard of unemployment insurance benefits shall be determined by the people’s governments of provinces, autonomous regions, or municipalities directly under the Central Government, and shall not be lower than the minimum living standard of urban residents.”
For example, Mr. Zhang of Guangdong Province was unemployed after four years of working and contributing unemployment insurance, then re-employed after six months, and unemployed again after two years of working. Guangdong Province stipulates that if the contribution is less than four years, the unemployment insurance benefits shall determined by the years of contribution: one year contribution enabling one month of unemployment insurance benefit,4Article 17 of the Regulations of Guangdong Province on Unemployment Insurance in 2022.and the local unemployment insurance benefit standard is be RMB 1,000. How much unemployment insurance benefits can Mr. Zhang get?
When Mr. Zhang is unemployed for the first time, the contribution years is 4 years, so Mr. Zhang can receive unemployment insurance benefit of RMB 4,000 (4 * 1000). When Mr. Zhang is unemployed for the second time, the contribution duration is 2 years (because he has received unemployment insurance benefits for the first time, the payment period is reset to zero and re-accrued), so Mr. Zhang can still receive unemployment insurance of RMB 2,000 (2 * 1000). It should be noted that since Mr. Zhang has received unemployment insurance for a total of 6 months, the total amount of unemployment insurance benefit that Mr. Zhang may receive in the future can not exceed 18 (24-6) months of unemployment insurance benefits.
If the employer has not purchased unemployment insurance for the employee, the employee may claim 120% of the aforementioned unemployment insurance benefits as compensation from the employer. For example, in the aforementioned case, if the employer did not purchase unemployment insurance for Mr. Zhang, Mr. Zhang can claim against the first employer for RMB 4,800 of unemployment insurance benefits (4000 * 120%) when he is unemployed for the first time, and the second employer may be liable for RMB 2,400 of unemployment insurance benefits (2000 * 120%) if it failed to purchase the unemployment insurance for Mr. Zhang.
This is a relatively obscure employee’s employment rights. The employees, for whose employer did not buy unemployment insurance and who was terminated employment on non-voluntary basis, are entitled to claim to the employer for unemployment insurance payment, as well as economic compensation or punitive damages. If an employer who has purchased unemployment insurance for an employee fails to provide the employee with a certificate of termination of employment relationship in time, resulting in the employee’s inability to apply for unemployment insurance benefits, it may also be liable for compensation for unemployment insurance benefits.5Anhui High Court Releases Typical Case of Judicial Protection of Workers’ Labor Rights in Anhui Province (2013-2016) No.10: Labor Dispute Case of Tao v. a Pharmaceutical Company in Huainan-If the employer terminates the employment contract illegally, it shall compensate the workers for economic compensation, unemployment insurance, etc.
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Mr. Dong Wang has been in practice for over 20 years, specializing in business law, including employment law, commercial law, company law, and intellectual property law. Mr. Wang has earned respect and trust from his clients due to his professionalism, fidielty, and kindness.
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- 1Article 45 of the Social Insurance Law of the People’s Republic of China in 2018 States that “an unemployed person who meets the following conditions shall receive unemployment insurance benefits from the unemployment insurance fund: (1) The employer and the unemployed person have paid unemployment insurance premiums for one year before the unemployment; (2) The employment is terminated by the unemployed person voluntarily; (3) The unemployed person has registered for unemployment and has job seeking requirements”.
- 2Article 16 of the Regulations on Unemployment Insurance of Guangdong Province in 2022
- 3Article 46 of the Social Insurance Law of the People’s Republic of China in 2018. “If the employer and the unemployed person have paid contributions for more than one year but less than five years before unemployment, the maximum period for receiving unemployment insurance benefits shall be 12 months; if the employer and the unemployed person have paid contributions for more than five years but less than ten years, the maximum period for receiving unemployment insurance benefits shall be 18 months; If the accumulative payment is more than 10 years, the maximum period for receiving unemployment insurance benefits shall be 24 months. In case of re-unemployment after re-employment, the time of payment shall be recalculated, and the period of receiving unemployment insurance benefits shall be combined with the period of receiving unemployment insurance benefits that should have been received but not yet received in the previous unemployment, and the maximum period shall not exceed 24 months.” Article 47, “The standard of unemployment insurance benefits shall be determined by the people’s governments of provinces, autonomous regions, or municipalities directly under the Central Government, and shall not be lower than the minimum living standard of urban residents.”
- 4Article 17 of the Regulations of Guangdong Province on Unemployment Insurance in 2022.
- 5Anhui High Court Releases Typical Case of Judicial Protection of Workers’ Labor Rights in Anhui Province (2013-2016) No.10: Labor Dispute Case of Tao v. a Pharmaceutical Company in Huainan-If the employer terminates the employment contract illegally, it shall compensate the workers for economic compensation, unemployment insurance, etc.