IV. Insurance for Work-related Injuries

The Chinese government has made great efforts to establish an insurance system for work-related injuries that includes work-related injury prevention, compensation and recovery. After January 2004, when the “Regulations on Insurance for Work-related Injuries” went into effect, the coverage of such insurance has expanded rapidly. By the end of June 2004, as many as 49.96 million employees had underwritten this insurance scheme.

Establishing a Social Pool System for Insurance Funds for Work-related Injuries

The state stipulates that all enterprises and all individual businesses engaged in industry and commerce with employees must participate in work-related injury insurance, and pay insurance premiums for all their employees, permanent as well as temporary. The individual employees do not pay such premiums. The work-related injury insurance scheme adopts a social pool fund program with a balance of revenue and expenditure, and collection determined by expenditure. The social pool funds are established by cities at the prefectural level or above. The government determines the differential premium rates according to the degree of risk of work-related injuries involved in different sectors, and sets several premium rates within each sector according to the insurance payments and occurrence rates of such injuries.

Defining the Social Security Benefits

The work-related injury insurance scheme adopts the principle of “no-fault compensation.” The benefit items mainly include medical expenditures for work-related injuries; injury and disability subsidy, allowance and nursing fee according to the degree of loss of the ability to work; funeral subsidy, pension for the keep of family members and a lump-sum death subsidy payment, all of which go to the directly-related family members of the deceased worker in the case of death resulting from a work-related accident. The main qualifying condition for insurance payment is that the employee has been injured as a result of a work-related accident or has contracted an occupational disease during his or her working hours and within his or her workplace.

Exercising a Labor Ability Assessment System

The state has uniformly formulated and promulgated a national standard for assessment of the degree of a work-related injury and the degree of a disability caused by an occupational disease, whereby to assess the labor ability of an employee suffering from disability and whose labor ability has been affected due to a work-related injury, notwithstanding its being in a relatively stable condition after treatment. The labor ability assessment includes rating of the degree of physical impediment for labor and the degree of impairment to self-care ability. A labor ability assessment committee, consisting of representatives from relevant departments of the government, trade unions and employing units, is formed in each provincial-level city and city divided into districts to be in charge of the assessment of labor ability of injured and maimed employees. Application for labor ability assessment can be submitted by the employing unit, the employee suffering from the injury, or his or her directly-related family members, to the local committee. Having received the application, the committee will randomly choose members from its reserve of medical and health experts to conduct the assessment, and give its assessment conclusion based on the experts’ opinions.

Strengthening Work-related Injury Prevention and Occupational Rehabilitation

The Chinese government actively promotes prevention of work- related injuries and occupational diseases through improvement of engineering technology, publicity and education, formulation of safety regulations, implementing safety and hygiene standards, and encouraging employing units to improve production safety by manipulating their injury insurance premium rates. Following the principle of “safety and prevention first,” the government urges enterprises and employees to abide by the rules and regulations concerning work safety and hygiene, and to strictly enforce the state work safety and hygiene rules and standards, so as to prevent accidents during work, and reduce occupational hazards.

The state actively explores methods of occupational rehabilitation, providing injured workers with injury recovery, psychological recovery, occupational training and employment guidance. Occupational rehabilitation centers and hospitals have been set up in some areas to help injured workers to overcome physical and mental problems, regain their health and ability to work, and return to their jobs.