★Nutshell
In December 2012, Mr Wei joined a weaving factory as a general worker. When negotiating with the employer about the labor contract, he voluntarily gave up his own legitimate rights and interests of social insurance in order to get higher salary.
But unfortunately, in July 2014, the pectoralgia and dorsalgia attacked Mr Wei. And what’s worse is, he was diagnosed as a high-risk hypertension patient at hospitalization.
The medical invoice submitted by Mr Wei indicated that he had already paid over 230,000 yuan for his treatment which could be covered up to two-third by medical insurance if he hadn’t given up his own social insurance premiums.
However the total medical expenses should be borne on his own expense because he has not paid the social insurance.
Afterwards, Mr Wei requested the employer to bear his out-of-pocket medical expenses.
But his requirement was rejected by the employer because of his voluntary abandonment of his own social insurance.
Since no result has been reached in that negotiation, Mr Wei claimed to the labor arbitration to require the employer to reimburse his out-of-pocket medical expenses of 230,000 yuan in December 2014.
★Issue
The company thinks since Mr Wei has given up his own social insurance voluntarily and have participated in the endowment insurance for rural areas in his hometown, therefore , for the sake of fairness, Mr Wei can’t enjoy reimbursement treatment repeatedly. The company has no obligation to reimburse Mr Wei’s medical expenses.
In the meantime, Mr Wei attributes the disability to get the reimbursement for his enormous medical expenses to the company’s absence of undertaking the legal obligation to pay social insurance premiums.
He hasn’t participated in the social endowment insurance for rural areas. And the relevant medical expenses have not been reimbursed yet. So the company has the legal obligation to pay his medical expenses. Therefore, the company should undertake his out-of-pocket medical expenses.
★Judgment
The labor tribunal and the court of first instance think the agreement on giving up social security between the two parties is invalid for violate the mandatory provisions of the law. So the company should undertake Mr Wei’s out-of-pocket medical expenses.
The final judgment requires the company to pay Mr Wei over 180,000 yuan medical expenses for its absence of undertaking the legal obligation to pay social insurance premiums.
★Comment by Lawyer Tang
This dispute is arised from the employer’s absence of undertaking the legal obligation to pay social insurance premiums. And the final judgment requires the employer to undertake the out-of-pocket medical expenses.
Article 72 of the Labor Law of the People’s Republic of China indicates :” The sources of social insurance funds shall be determined according to the categories of insurance, and an overall pooling of insurance funds from the society shall be introduced step by step. The employing unit and laborers must participate in social insurance and pay social insurance premiums in accordance with the law. ”
Article 72 indicates that:” Laborers shall, in accordance with the law, enjoy social insurance benefits under the following circumstances: (1) retirement; (2) illness or injury; (3) disability due to work-related injury or occupational disease; (4) unemployment; (5) childbearing. The survivors of the insured laborers shall be entitled to subsidies for survivors in accordance with the law. The conditions and standards for laborers to enjoy social insurance benefits shall be stipulated by laws, rules and regulations. The social insurance that laborers are entitled to, must be timely paid in full.”
The article 23 of the Social Insurance Law of the People’s Republic of China indicates that: “Employees shall participate in the basic medical insurance for employees, and the basic medical insurance premiums shall be jointly paid by employers and employees in accordance with the relevant provisions of the state. Individual industrial and commercial households without employees, part-time employees not participating in the basic medical insurance for employees through their employers and other persons in flexible employment may participate in the basic medical insurance for employees, but the basic medical insurance premiums shall be paid by the individuals in accordance with the relevant provisions of the state.”
According to the above-mentioned regulation, the employers and the employees shall participate in social insurance and pay the premium.
The employee suffer from an illness shall enjoy social insurance benefits in accordance with the law
The agreement on voluntary giving up the social insurance in the labor contract violates the mandatory provisions of the law and shall be invalid.
The employers and employees must participate in social insurance and pay social insurance premiums in accordance with the law. The agreement of both parties violates the mandatory provisions of the law and shall be invalid.
Since the company can’t provide any evidence to prove that Mr Wei had participated in the new-type social endowment insurance for rural areas, the responsibility to reimburse Mr Wei’s medical expenses shall be borne by the company.
Although, generally speaking, disputes on social insurance are not under the jurisdiction of labor arbitration or the people’s court. And in such situation, employees can only complain to the labor administrative department.
But the labor dispute coursed by that the employee cannot enjoy social insurance treatments because his employer failed to conduct the social insurance formalities for him is within the scope acceptable by the labor tribunal and the court.
The article 1 of the Interpretation (III) of the Supreme People’s Court of Several Issues on the Application of Law in the Trial of Labor Dispute Cases indicates that: “Where an employee requires his employer to compensate him for losses on the ground that he cannot enjoy social insurance treatments because his employer fails to conduct the social insurance formalities for him and the social insurance agency cannot make up such formalities, the people’s court shall accept a case on such a dispute”.
As a reminder, it’s employers’ legal obligation to pay the social insurance premiums. And such obligation cannot be avoided by the agreement between the employee and the employer.
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