China: Applying Condition For Illness Relief

Last Updated: 2 January 2018
Article by River Delta Law Firm

1. Case Introduction

Mr.Wang joined in Construction Company A in 1997 as an manager with no written agreement about remuneration. Wang and Company A both agreed in the labor contract that the company is entitled to adjust Wang's position according to the actual condition and Wang's performance. Also, Wang's remuneration depends on the position, i.e. position adjustment would lead to remuneration changes. In 2013, adjusted by the group company, Wang was transferred into Company B and served as the Vice General Manager with remuneration and benefits maintained, and right and obligation of Company A agreed in labor contract were taken over by Company B.However, Wang applied for several sick leaves out of his lumbar disc herniation from 2014, and has been absent from work since July 2015. Among these years, Wang has been in sick leave for 103 days in 2015, 327 days in 2016 and 268 days in 2017 so far, while he also enjoyed the statutory holiday and rest days.

Until April 2017, Company B still paid Wang 100% remuneration during her sick leave. In May 2017, Company B notified Wang in written that owing to Wang's successive sick leave over eight months, the company decided to pay him 60% of base salary as illness relief since May 2017. Wang disagreed on it and argued that he was present on April 3 and 4 in light of his fingerprint on the attendance checking recorder. Since he was not in sick leave then, his successive sick leave shall not exceed eight months. Company B explained that Wang came to login his fingerprint in the new attendance checking record system instead of coming for work. Wang neither report ed to General Manager nor provided work on those days. Oppositely, he came to submit sick leave certificates. Therefore, it's with obvious malice of avoiding to be judged as "successive sick leave over six months". The conflict lied in this point.

2. Legal Analysis

1) Applying Condition and Standard for Illness Relief
"Illness Relief" was firstly mentioned in Article 13 of PRC Labor Insurance Regulations that if a worker or a staff member stops working and receives treatment due to sickness or non-work-related injury, he shall be entitled to sick leave salary when his successive treatment period is less than six months, and shall be entitled to illness relief when the period is over six months.
Based on the above clause, the precondition for applying sickness relief at least contains:

  1. Employee is in sickness or in non-work-related injury;
  2. Employee needs to stop working, receive treatment or recuperation, which requires certificates or suggestion from qualified medical organization;
  3. The successive period for treatment or recuperation is over six months.

In Shanghai, learning from Labor Insurance Regulation, the local rule differs benefits with terms of leave period. Also, Shanghai Labor Bureau issued The Notice of Enhancing Sick Leave Management and Protecting Employee's Life in Sick Leave, among which: If an employee is in successive sick leave over six months due to sickness or non-work-related injury, the company shall pay for illness relief. Also with the calculation rules:

  1. Successive service period less than one year, illness relief is as 40% of individual salary;
  2. Successive service period more than one year but less than three years, illness relief is as 50% of individual salary;
  3. Successive service period equals to or more than three years, illness relief is as 60% of individual salary;
  4. Illness relief shall not be less than 80% of minimum salary of the city.

2) Case Analysis

First of all, the major issue in this case is whether Wang meets the requirement for applying illness relief. The consideration includes the following two aspects.

On the one side, there are indeed no sick leave certificates on April 3 and 4,2017. Therefore, strictly, according to the diagnose advice, Wang did not need to receive treatment or recuperation on these two days. Also, according to attendance checking records, Wang was indeed present on these days. Even if the defense that Wang came to submit certificates was proposed by the company, it would not change the fact of his presence.

On the other side, considering Wang has been in illness since July 2015, he could not perform his obligation actually, and so, Company B could not arrange his work objectively. Wang has been in long term continuity of stopping work. Even if Wang actually attend to work on April 3 and 4, considering Wang's position of Vice General Manager, Company B could not arrange work for Wang immediately also. We could not require Wang to proceed with managing and operating work immediately just after his long-term absence. Thus, Wang shall not be judged as present nor working in these two days.

To sum up, strictly, Wang did not meet Condition III of the above applying requirement for illness relief, so Company B is lack of legal base in considering that Wang's successive sick leave is over eight months. However, it shall be noted that Shanghai's sick leave salary and illness relief standard is higher than most other cities, there are indeed a few cases that employee cheats for sickness benefits, especially utilizing or adjusting the sickness certificate period to avoid being judged as successive sick leave over 6 months, which would cause issue and impact on company's management. Therefore, if Shanghai local regulation would list this circumstance as an exemption, i.e. employee's malice in stopping successive sick leave period to avoid meeting the period cap would lead to company's exemption, the system would be more reasonable and discreet, which would also reflect the legislative intention.

Secondly, another controversial matter is that if Wang's sickness certificate period is not continuous just due to statutory holiday nor rest days, whether it could be considered as successive sick leave over six months? For example, Wang submitted a sickness certificate until April 30,2017, and the next leave period started from May 4,2017, which means the gap between these two leave periods is only Labor Holiday and day off.

There are different opinions in practice. One view is that employee's stopping working in statutory holiday and rest days are in accordance with employee's rest right, which is different from the sick leave. Therefore, there is no legal base to include statutory holiday and rest days into successive leave period. Another view is that even if employee has no sick certificate on statutory holiday or rest day, employee is still in sickness or recuperation objectively. Therefore, lack of sick certificate on statutory holiday and rest days would not lead to the successive leaves suspension.

Regarding Shanghai includes working day instead of rest days in calculating medical treatment period, from my point of view, the second view is more reasonable. 

3. Practical Suggestion on Sick Leave Management

To conclude the above analysis, Company B is facing relatively high legal risk. In this case, except Wang plays a trick in submitting sickness certificates, there are also problems in Company B's management. It is highly recommended to notice in the future company's management: 

1) Company shall manage and take record of the sick leave certificates.
    In this case, Wang submitted lots of medical certificates during his leave and HR of Company B failed in finding that Wang's medical period suspended on April 3 and 4, 2017, and still paid for sick leave salary, which caused Company B fall into passive condition. It is suggested that:
For one thing, company could list in regulations that if employee applies for long term sick leave, it is required to submit new certificates prior to the expiration of sick leave period.
Also, HR shall take good note of all certificates submitted by employees. Under the circumstance that employee's sick leave period is expired and employee does not submit new certificates, HR shall get in touch with the employee in time and notify him or her to update the health condition or to come back to work.

2) Company shall establish the reexamination system for long term sick leave and verify the truth of certificates.
In practice, among most cases related to long-term sick leave, employee's sickness is not serious enough to take such a long-term leave. About such circumstance, it is suggested to establish a reexamination system for long-term sick leave, which requires the employee, whose successive sick leave period is relatively long, to take a reexamination in the specified medical organization and therefore the company could know about employee's actual health condition correctly. Besides, company could engage professionals to investigate and verify the truth of certificate, to avoid the fake certificates. Even if the certificate is real, it is still recommended to know more from the doctors about the employee's health condition.

3)  Company shall set the calculating standard for illness relief or sick leave salary.
According to Shanghai's regulations, the illness relief and sick leave salary is calculated based on employee's service period in the company and his base salary. Meanwhile, if the sick leave benefits are higher than the Shanghai employee's average salary standard of last year, the benefits could be calculated as the average. It is suggested to set the company standard for illness relief or sick leave salary based on company's actual condition, which shall not be less than the statutory minimum standard, to reduce employee's cheating in sick leave.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions