Compiled from: Workers' Daily, Shandong High Court
 
As China's insurance system matures, more and more enterprises choose to cooperate with professional human resources companies, signing contracts such as "Labor Affairs Agency Contracts" and "Insurance Agency Contracts" to entrust basic endowment insurance, basic medical insurance, work-related injury insurance, unemployment insurance, maternity insurance, and other social basic insurances to human resources companies for payment. So, is the payment of social insurance on behalf of others legal and valid? Recently, the Qingdao Intermediate Court disclosed a similar case.
 
Case review
A metal products factory in Qingdao signed documents such as the "Labor Affairs Agency Contract" and "Social Insurance Agency Contract" with a human resources company in Qingdao, stipulating that the human resources company would pay social insurance premiums for the factory's employees in accordance with the payment standards stipulated by the relevant policies of the place where work-related injury insurance was paid.

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The metal products factory agreed that the work-related injury insurance paid on its behalf would be based on the minimum payment base of the place of payment, and the human resources company would carry out work-related injury declaration and identification, as well as claim and receive work-related injury insurance expenses after an injury occurred. The contract between the two parties also stipulated the content of cooperation, duration, liability for breach of contract, and other rights and obligations. However, thereafter, the human resources company instead paid work-related injury insurance for the factory's employees in Jiangxi Province through another human resources company in Jiangxi.
 
Subsequently, a work-related injury accident occurred involving an employee of the factory, leading to disputes among the parties over work-related injury insurance claims. The factory then filed a lawsuit, claiming that the "Labor Affairs Agency Contract" and "Social Insurance Agency Contract" signed with the Qingdao human resources company were invalid, and demanded the return of all insurance fees already paid to the Qingdao human resources company.
 
 
[1] Court Opinion
After trial, the court held that although the parties had signed a written agency contract, the Qingdao human resources company, after accepting the agency, sometimes handled the work-related injury insurance itself and sometimes entrusted others to pay it in other provinces, thereby fragmenting the government's management of the employment system, disrupting the social insurance order, and altering the original intent of basic social insurance. Therefore, the contract signed between the parties should be deemed invalid.
 
Upon review, it was determined that the metal products factory had paid over 240,000 yuan in work-related injury insurance fees to the Qingdao human resources company. Among these, the Qingdao human resources company had already paid over 30,000 yuan in work-related injury insurance for the factory, and since this fee had already been paid to the social insurance institution, it did not need to be returned. For the remaining over 200,000 yuan, based on the degree of fault of both parties, the court ordered the Qingdao human resources company to return 100,000 yuan to the metal products factory.
 
 
《[1] The People's Republic of ChinaSocial Insurance Law
Article 60
Employers shall declare and pay social insurance premiums in full and on time. No deferral or reduction is allowed except for statutory reasons such as force majeure. The portion of social insurance premiums payable by employees shall be withheld and paid by the employer on their behalf, and the employer shall inform each employee of the details of the social insurance premiums paid on a monthly basis.
Self-employed individuals without employees, non-full-time workers not participating in social insurance through an employer, and other flexible workers may pay social insurance premiums directly to the social insurance premium collection agency.
 
 
[1] The author's perspective
According to the above legal provisions, employers are required to declare and pay social insurance premiums in full and on time. This is a statutory responsibility of the employer, which is naturally the entity that has established an actual labor relationship with the worker. Therefore, even if the employer entrusts a human resources company to handle insurance matters, it should be done in the name of the employer. Otherwise, if the entity handling social insurance is inconsistent with the employer, it not only easily leads to the shifting of responsibility for work-related injuries but also undermines China's employment registration system, conceals the true labor relationship, and is detrimental to protecting workers' rights. Thus, in such cases, the proxy payment of social insurance is illegal and invalid.