synonymeconomic compensation (Economic compensation) generally refers to economic compensation
This term is provided by the "Rule of Law Encyclopedia" project leading group office of China Law Society.
Economic compensation refers to the economic subsidy paid by the employer to the worker in a lump sum according to law when the labor contract is dissolved or terminated without the worker's fault.[1]
Economic compensation refers to the economic subsidy paid by the employer to the worker in a lump sum according to law when the labor contract is dissolved or terminated without the worker's fault.
Legal provisions
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Labor Law of the People's Republic of China
Article 28 Where an employing unit terminates a labor contract in accordance with the provisions of Articles 24, 26 and 27 of this Law, it shall pay economic compensation in accordance with the relevant provisions of the State.
Labor Contract Law of the People's Republic of China
Article 46 In any of the following circumstances, the Employer shall pay economic compensation to the worker: (1) The worker terminates the labor contract in accordance with Article 38 of this Law;
（2） The employing unit proposes to terminate the labor contract with the laborer in accordance with the provisions of Article 36 of this Law and reaches consensus with the laborer to terminate the labor contract;
（3） The employer terminates the labor contract in accordance with Article 40 of this Law;
（4） The employing unit terminates the labor contract in accordance with the provisions of the first paragraph of Article 41 of this Law;
（5） The fixed term labor contract is terminated in accordance with Item 1 of Article 44 of this Law, except that the employer maintains or improves the conditions agreed in the labor contract to renew the labor contract, and the employee does not agree to the renewal;
（6） The labor contract is terminated in accordance with the provisions of Items 4 and 5 of Article 44 of this Law;
（7） Other circumstances stipulated by laws and administrative regulations.
Scope of application
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According to Article 46 of the Labor Contract Law, the circumstances under which an employer should pay economic compensation to workers include:
（1） "The laborer terminates the labor contract in accordance with Article 38 of this Law".This is the case that the laborer terminates the labor contract at any time and immediately.
（2） "The employing unit proposes to terminate the labor contract with the laborer in accordance with the provisions of Article 36 of this Law and reaches an agreement with the laborer to terminate the labor contract".This is the case where both parties agree to terminate the labor contract.
（3） "If the employer terminates the labor contract in accordance with Article 40 of this Law, it will be terminated without fault.
（4） "The employing unit terminates the labor contract in accordance with the provisions of the first paragraph of Article 41 of this Law".This is the situation of economic layoffs.
（5） "Unless the employer maintains or improves the conditions agreed in the labor contract to renew the labor contract, and the employee does not agree to renew the labor contract, the termination of the fixed term labor contract in accordance with the provisions of Item 1 of Article 44 of this Law is the termination of the fixed term labor contract due to the expiration of the labor contract.
（6） "The labor contract is terminated in accordance with the provisions of Items 4 and 5 of Article 44 of this Law".This is the case that the labor contract is terminated because the employer is declared bankrupt according to law, the business license of the employer is revoked, the employer is ordered to close down, or the employer decides to dissolve in advance (can be collectively referred to as the loss of the employer's subject qualification).
（7） "For other situations stipulated by laws and administrative regulations, see Article 22 of the Regulations on the Implementation of the Labor Contract Law;"If a labor contract whose term is to complete a certain task is terminated due to the completion of the task, the employer shall pay economic compensation to the worker in accordance with Article 47 of the Labor Contract Law. Article 13 of the 2013 Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Labor Dispute Cases (IV) stipulates that the Labor Contract LawAfter implementation, if the labor contract cannot continue to be performed due to the employer's failure to continue to operate at the end of its business term, and the worker requests the employer to pay economic compensation, the people's court shall support it.
The economic compensation of the injured workers shall not be offset against the one-off medical subsidy for industrial injuries and the disability employment subsidy.Article 23 of the Regulations on the Implementation of the Labor Contract Law stipulates that: "If an employer terminates the labor contract of an injured employee according to law, in addition to paying economic compensation in accordance with the provisions of Article 47 of the Labor Contract Law, it shall also pay one-time medical subsidies for work-related injuries and disability employment subsidies in accordance with the provisions of the State on work-related injury insurance."
computing method
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（1） Legal basis
Article 47 of the Labor Contract Law stipulates: "The economic compensation shall be paid to the laborer according to the number of years he has worked in the unit, and the standard of one month's salary shall be paid to the laborer for every full year. If he has worked for more than six months but less than one year, the economic compensation shall be calculated as one year; if he has worked for less than six months, the economic compensation shall be paid to the laborer for half a month's salary.If the monthly salary of a worker is three times higher than the average monthly salary of the employees in the previous year published by the people's government of the municipality directly under the Central Government or the city divided into districts where the employer is located, the standard of economic compensation paid to the worker shall be three times the average monthly salary of the employees, and the maximum period of economic compensation paid to the worker shall not exceed 12 years.The monthly salary mentioned in this article refers to the average salary of the laborer for the twelve months prior to the dissolution or termination of the labor contract. "It stipulates restrictions on the payment of economic compensation to high-income workers, that is, limits the amount of economic compensation received by high-income workers in terms of working years and monthly wage base.
（2） Calculation of working years
Article 10 of the Regulations on the Implementation of the Labor Contract Law stipulates: "If a worker is assigned to work in a new employer from the original employer for reasons other than his own, the worker's working years in the original employer shall be consolidated into the working years of the new employer.If the original employer has paid economic compensation to the employee, the new employer will no longer calculate the employee's working years in the original employer when the new employer cancels or terminates the labor contract in accordance with the law to calculate the number of years of service to pay economic compensation. "According to Article 5 of the 2013 Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Labor Dispute Cases (IV), a worker was assigned to work in a new employer from the original employer for no reason of his own, and the original employer did not pay economic compensation, and the worker terminated the labor contract with the new employer in accordance with Article 38 of the Labor Contract Law,Or if the new employer proposes to dissolve or terminate the labor contract with the employee, and the employee requests to combine the working years of the original employer into the working years of the new employer when calculating the working years of paying economic compensation or compensation, the people's court shall support it.If an employer meets one of the following conditions, it shall be deemed as "the employee is assigned to work from the original employer to the new employer for no reason of his own":
1. The laborer still works in the original workplace and position, and the subject of the labor contract is changed from the original employer to the new employer;
2. The employer transfers workers in the form of organizational appointment or appointment;
3. Labor transfer due to the merger or division of the employer;
4. The employer and its affiliated enterprises conclude labor contracts with workers in turn;
5. Other reasonable circumstances.
（3） Calculation of wage standard
Article 27 of the Regulations on the Implementation of the Labor Contract Law stipulates that "the monthly salary of economic compensation as stipulated in Article 47 of the Labor Contract Law shall be calculated according to the wages due to the workers, including time wage or piece rate wage, as well as monetary income such as bonuses, allowances and subsidies.If the average wage of a worker in the 12 months prior to the termination or rescission of the labor contract is lower than the local minimum wage standard, it shall be calculated according to the local minimum wage standard.If a worker has worked for less than 12 months, the average wage shall be calculated on the basis of the number of months actually worked. "
（4） Section calculation of economic compensation
Article 97 of the Labor Contract Law stipulates: "If a labor contract that has been concluded in accordance with the law before the implementation of this Law and is in existence on the date of the implementation of this Law continues to be performed... If a labor contract that is in existence on the date of the implementation of this Law is dissolved or terminated after the implementation of this Law, and economic compensation should be paid according to the provisions of Article 46 of this Law, the economic term shall be calculated from the date of the implementation of this Law;";Before the implementation of this Law, if the employer should pay economic compensation to the workers according to the relevant provisions at the time, the relevant provisions at the time shall prevail. "
common problem
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（1） Economic compensation and compensation
Economic compensation and compensation are two different concepts.Economic compensation refers to the monetary compensation given to the laborer in accordance with the conditions and standards stipulated by law when the employer terminates or terminates the labor contract with the laborer without the laborer's fault.Judging from the nature and application of the two, compensation is applicable to the case of the employer's illegal dissolution of the labor contract, and economic compensation is applicable to the case of the employer's legal dissolution or termination of the labor contract. The two cannot be applied at the same time.The so-called illegal dissolution of the labor contract refers to the dissolution of the labor contract outside of the circumstances where the labor contract can be dissolved as stipulated in the Labor Contract Law, the dissolution of the labor contract not in accordance with the procedures stipulated in the Labor Contract Law, or the dissolution of the labor contract in violation of the provisions of the Labor Contract Law prohibiting the dissolution of the labor contract.
（2） Economic compensation and unemployment insurance
According to the Labor Law and the Labor Contract Law of our country, when the labor contract is terminated or dissolved, the employer may need to pay economic compensation to the worker, and the payment of unemployment insurance compensation is the content of the Unemployment Insurance Regulations. Therefore, from the perspective of form, the two do not seem to have an inevitable relationship.However, whether it is economic compensation or unemployment insurance, its function is to ensure the economic security of workers after leaving their jobs, and both have the function of unemployment compensation.Therefore, Article 22 of ILO Convention No. 168 on the Promotion of Employment and Unemployment Protection stipulates: "When the protected person has directly received severance pay from the employer or other sources, which is mainly used to compensate for his loss of income in the case of total unemployment, in accordance with the legislation or the collective contract, each member can make a choice in the following circumstances:
1. The unemployment allowance that the unemployed could have enjoyed can be stopped during the period when the severance pay compensates for the loss of income;
2. The severance allowance may be reduced, and the reduced amount is equivalent to the regular payment that the relevant person is entitled to receive during the corresponding period when the severance pay is used to offset the income loss.
"When calculating the amount of unemployment benefits, the states in the United States adopt the way of reduced benefits for those who have economic compensation. This" offsetting model "has certain rationality: on the one hand, it avoids the negative impact of the unemployed workers' desire for reemployment that may be weakened by obtaining dual security;On the other hand, it can save the expenditure of unemployment insurance benefits and enhance the payment ability of unemployment insurance benefits.At present, China adopts the "get both" model, that is, eligible unemployed people can receive economic compensation paid by employers and unemployment insurance paid by social insurance agencies at the same time.
