Q1. Why are there different grades for the minimum wage standard?
As shown in the chart below, the minimum wage varies from place to place and is graded. The minimum wage is graded according to the level of the local economy in each province. For example, the first-level minimum wage is applied to provincial capital cities, the fifth level minimum wage is applied to fifth-tier cities.
Q2. How is the minimum wage adjusted?
In accordance with the minimum wage provisions and the relevant policies of the Social Security Bureau, the minimum wage can be adjusted every two years in each province depending on the local economy of the province. The adjusted minimum wage shall not be lower than the pre-adjustment minimum wage.
Q3. How is the minimum wage calculated?
According to the relevant provisions of the minimum wage regulation, the minimum wage is calculated in two ways, which is the monthly wage for full-time workers and the hourly wage for part-time workers. There are different methods of calculation according to the type of employment and the requirements for respective positions.
Q4. Is the “Social insurance and housing provident fund” included in the minimum wage?
In general, the “social insurance and housing provident fund ” is included in the minimum wage, which means, the expenses that employees incur to pay social insurance and their contributions to the provident funds are part of the minimum wage and are paid by the employer on behalf of the employees in the name of the employer (you may read our blog: More on Social Insurance for more information). However, the policies in some regions, such as Beijing and Shanghai, clearly indicate that the “Social insurance and housing provident fund” do not fall within the scope of the minimum wage.
