Salary Payment Regulations During Shanghai Lockdown
According to the Notice “Concerning Properly Handling Labor Relations during the Prevention and Control of the Outbreak (No.8 [2020])”, companies whose operations are suspended for less than a monthly salary payment cycle must pay their employees the full regular salary. If the suspension of operation exceeds a month’s salary payment cycle and there is no possibility to work remotely, or if employees cannot return to their positions due to the pandemic control measures, employers may negotiate with employees to use annual leave or another type of leave, with employees compensated according to the provisions of that leave. In the event that there is no leave to be used and the employees are still unable to work normally, companies can still negotiate with employees to reduce the monthly salary but must still pay the local minimum wage, which in Shanghai is RMB 2590. For the second month’s salary payment cycle the company should pay at least the minimum expenses equal to 80% of minimum salary (80% *2590).
Regarding social welfare, Shanghai will continue to implement Circular No. 11 issued by the Ministry of Human Resources and Social Security on “Reducing social insurance contribution rate during lockdown” related to unemployment and medical insurance contribution rate. This provides for refunding 50% of the unemployment insurance premium and lowering the employees’ medical insurance contribution rate by 0.5%.