The Wage Costs Sharing Mechanism during an Epidemic When Employees Cannot Work Normally

Xie Zengyi

Abstract: The major problems in the wage payment rules for workers who are unable to work normally due to the COVID-19 epidemic in China include: the lack of clear legal basis for some rules due to the imperfections in laws and regulations; the lack of uniformity of the rules issued by different local governments; and the heavy burden of wage payment on enterprises resulting from the lack of a wage sharing mechanism. The epidemic is a force majeure and the causes and effects of suspension of production or operation by enterprises and the inability of employees to work as a result of the epidemic are all of social nature. Therefore, it is not appropriate for the wage payment costs during the epidemic to be borne solely by enterprises. China should draw on useful overseas experiences and establish a mechanism for using social insurance funds during the occurrence of such force majeure as an epidemic by expanding the scope of the use of unemployment insurance funds to cover the wage payment costs of enterprises.

 

Keywords: COVID-19 epidemic; worker; wage; sharing mechanism; unemployment insurance

 

The author of this article is a research fellow at and the head of the Research Coordination and International Cooperation Department of CASS Law Institute. This paper, published in Journal of Graduate School of Chinese Academy of Social Sciences 3 (2020), is a preliminary result of the ministerial key research project “The Impact of COVID-19 epidemic on labor relations and Legal Countermeasures Thereof” commissioned by China Law Society in 2020.