On August 28, 2013, the Beijing No. 1 Intermediate People’s Court confirmed that an individual who had already passed the statutory retirement age still maintained an employment relationship with the company, and therefore ordered the company to pay the employee work injury benefits. This is reported to be the first case in Beijing in which the court upheld the work injury benefits claim of an individual worker who reached the retirement age.
In this case, the individual joined the company in late 2005, but the company neither signed a written employment contract with him, nor enrolled him in the social insurance system. In August 2009, by which point the employee had reached the age of 61 years old, the employee suffered a transportation accident during the performance of his job. After several rounds of arbitration and litigation, the Beijing No. 1 Intermediate People’s Court finally confirmed that there was an employment relationship between the individual and the company, that the employee had suffered a work injury, and thus ordered the company to pay work injury benefits to him that normally would have been borne by the work injury insurance system if the company had been making work injury insurance contributions for him.
Under the Implementing Regulations of the PRC Employment Contract Law, an employment contract will end when the employee reaches the statutory retirement age (i.e., 60 for male employees, 50 or 55 for female employees). Further, under relevant Supreme Court Opinions, a dispute between the company and an individual worker who enjoys pension benefits should be treated as an ordinary civil claim (rather than an employment claim). PRC law is thus not entirely clear whether a dispute with an individual who reached the retirement age but has still not started receiving pension benefits should be treated as an employment dispute or a civil dispute. The above case, as well as the case in Jiangxi province reported in our August 2013 update, shows that at least some courts are willing to provide employment protections to those who have passed the retirement age but still not received pension benefits. A conservative approach would therefore be to either ensure that the individual applies for pension benefits and/or purchase commercial personal injury/accident insurance for such individual.