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Is Social Security Payment Legal? What are the legal responsibilities?

Social security contribution actually solves a lot of real problems, but it also allows some employers to take advantage of the legal loopholes to circumvent the rules. The law currently considers the social security contribution is not legal, although there is no explicit provision but some places clearly stipulate that the social security contribution is not allowed. So here's why there is a legal risk of social security contribution and its legal responsibility.

Social security contributions actually solve a lot of real problems, but the contribution of some employers to exploit the legal loopholes to circumvent the rules. The law currently considers social security contributions illegal, although there is no explicit provision, but some places clearly stipulate that social security contributions are not allowed. So here's why there is a legal risk of social security contribution and its legal responsibility.

A real-life reason for social security contributions

In reality, the employer entrusts a third party to pay for the employee's social insurance on a third-party account for a wide range of situations, roughly for the following reasons:

(a) the employer to transfer the contribution to reduce the cost of labor demand.

At present, the social security contribution base is linked to the local average social wage, such as the north, Guangzhou, Shenzhen and other economically more developed regions with higher average social wages, will be economically backward areas of the social security contribution base is high.

(ii) the reality of the demand for foreign workers.

(ii) The real demand of foreign workers. When there is a foreign worker and no local branch, it is impossible to pay the social security in the local area, and the workers employed in the local area tend to ask for the insurance in the local area.

(3) Delegating the payment of social security to other human resources companies is convenient and saves human resources management.

2. So, is it legal to pay on behalf of the company?

From the legal point of view, it is not legal. The social insurance agency shall examine the application within fifteen days from the date of its receipt and issue a social insurance registration document." Article 58 of the same stipulates that "the employer shall apply for social insurance registration with the social insurance agency for its employees within thirty days from the date of employment."

Although the Social Insurance Law does not explicitly prohibit the payment of social security, but from the above provisions, social insurance registration for territorial management, should be the employer's location of the social insurance agency, and the main body of the social insurance registration is the "employer". So from these two provisions, it can be deduced that the social security payment is not legal.

Third, the local provisions of the contribution

For example, the Guangdong Provincial Regulations on the Supervision of Social Insurance Funds (effective July 1, 2016, hereinafter referred to as the "Regulations") clearly stipulates the corresponding administrative penalties and criminal penalties of legal responsibility.

(A) Administrative Liability

Article 21(1)(2) of the Regulations stipulates that any unit or individual "shall not obtain the qualification for social insurance participation and payment of contributions through fictitious labor relations, falsification of supporting materials, etc." This provision explicitly prohibits the payment of social security contributions on behalf of the employees in the form of dependency. At the same time, the first paragraph of Article 61 of the Regulations stipulates the corresponding legal responsibility "If a person applies for social insurance business by means of fraud, falsification of certificates, fraudulent use of other people's documents, or fictitious labor relations, the administrative department of social insurance, the social insurance premium collection agency, or the social insurance agency shall not apply for the business, and shall record the relevant information in its credit file; and, if the circumstances are serious, shall be subject to a fine of not less than double and not more than triple the amount of money involved in the case. ." That is, according to the provisions of our Guangdong Province, social security contributions are no longer vague "gray" area. If the relevant units and individuals violate this provision, they may face administrative penalties from the social security administration.

(ii) Criminal liability

Article 70 of the Regulations states that "violation of the laws relating to social insurance constitutes a crime, and criminal liability shall be investigated according to law". If a person fraudulently obtains social insurance benefits or other social security benefits by fraud, forgery, or other means, he or she is guilty of defrauding public or private property as provided for in Article 266 of the Criminal Law. That is to say, the social security payment behavior is serious may face criminal liability (whether this is fraudulent, literally, controversial, non-professional, do not start the discussion).

Fourth, on behalf of the social security also has the following risks

(a) economic compensation

As mentioned earlier, on behalf of the social security of the situation, regardless of the employer's initiative on behalf of the payment of laborers or off-site employment when the request of the laborer, the worker can be unpaid social security as a reason for leaving, and get economic compensation;

(b) social insurance There are obstacles to the payment of benefits

For example, a company in Shanghai, commissioned a third party to pay social security in Guangzhou, and suffered a work injury. However, in the determination of work injury, because the actual employer does not pay social security, and the social security payment unit is not the employer, so the injury may not be paid, so the cost of the injury is still borne by the real employer;

In addition, there are some places are very strict, the place of registration of the company and the social security payment is not the same, may also be the legal grounds for refusal of compensation;

(C) Treatment difference

For example, an employer in Shanghai has a third party pay social security on behalf of the employer in Guangzhou. This is because the regulations on industrial injury insurance clearly stipulate that if the actual amount of the disability allowance is lower than the local minimum wage standard, the difference will be made up by the Industrial Injury Insurance Fund. If the actual amount of disability allowance is lower than the local minimum wage standard, because the minimum wage standard in Shanghai is higher than the minimum wage standard in Guangzhou, the difference may be required to make up for the difference;

(d) Dual Payment of Social Security

The establishment of a labor relationship, the real employer does not pay the social security insurance, the social security administrative department may be ordered to make up for the payment of the issue of social security administration as for the employer to find a third party in a foreign place to pay the fact, due to various reasons, such as the third party in Guangzhou. As for the fact that the employer is looking for a third party to make payments on behalf of the employer in a different location, it may not be heeded for various reasons, such as the need to replenish the social security fund in various places.

In summary, the question of whether social security contributions are legal or not, and the legal responsibility for them, tends to be unlawful, and there are even some places where it is clear that they want to clear this gray area. In fact, on behalf of the social security units suspected of forging documents to fraudulent social security, the opportunity after the administrative penalties and criminal responsibility.

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