Sick pay rules and medical treatment periods in Shanghai

As an employee in Shanghai, you may have questions about sick leave, sick pay, or medical treatment periods, such as:

How is sick pay calculated?

How many days of sick leave count as one full month of the medical treatment period?

Are employees on probation entitled to a medical treatment period?

If an employer terminates a contract after the medical period ends, can employees receive economic compensation ?

Can a contract be terminated if it expires before the medical period concludes?

Here is a reference guide with answers from the Shanghai Municipal Human Resources and Social Security Bureau for these frequently asked questions.

01 How is sick pay calculated?

Case:

Helen is an HR professional at a cultural company. Recently, an employee needed surgery, and the employee's family submitted a one-month sick leave form to the company. How should the employee's sick pay be calculated during this period?

02 How many days of sick leave count as one full month of the medical treatment period?

Case:

Kate is a designer who has been working at an IT company for over two years. At the beginning of the month, she was hospitalized, and her doctor issued a medical certificate for a 14-day sick leave.

Since the beginning of this year, Kate has taken nearly 60 days of intermittent sick leave. The company's HR informed her that her medical treatment period had ended, and any further sick leave might lead to termination of her contract. She wondered how many days of sick leave count as one full month of the medical treatment period?

Answer:

The medical treatment period is calculated and accumulated from the first day of taking sick leave. It is generally based on the calculated average monthly working days under national rules: an employee taking 20.67 consecutive or cumulative days of sick leave is considered to have used one month of the medical treatment period. This does not include China's statutory holidays and rest days.

In Kate's case, having worked for more than two but less than three years at the company, her medical treatment period should be four months. This means she would need to take 82.68 consecutive or cumulative days of sick leave to use up her medical treatment period.

As she has already taken 60 days of sick leave, she still has 22.68 days remaining. Therefore, the HR's statement is incorrect.

Tips:

According to China's stipulation on the calculation of average annual monthly working days and wage conversion rules, the number of statutory holidays has been increased from 11 to 13 days. Accordingly, the calculations are as follows:

Annual working days: 365 days - 104 rest days - 13 statutory holidays = 248 days

Quarterly working days: 248 days ÷ 4 = 62 days per quarter

Monthly working days: 248 days ÷ 12 = 20.67 days per month

Working hours: Working days × 8 hours per day

03 Are employees on probation entitled to a medical treatment period?

Case:

Susan joined a food processing company in early September this year. She signed a three-year labor contract with a six-month probation period. During the flu season, she was hospitalized with pneumonia and took two weeks of sick leave. She asked the company if her contract could be terminated due to her illness during the probation period.

Answer:

The medical treatment period refers to the duration during which an employee suspends work due to illness or non-work-related injury for medical treatment and rest, and the employer cannot terminate the contract under such circumstances.

Shanghai's regulations state that the length of the medical treatment period is based on the employee's years of service at the current company. For the first year of employment, the medical treatment period is three months. For each subsequent full year of service, one additional month is granted, with a maximum total of 24 months. This means the medical treatment period is unrelated to whether the employee is on probation.

In Susan's case, having been employed for less than one year, she is entitled to a three-month medical treatment period, even during her probation. According to the Labor Contract Law of the People's Republic of China, employers cannot terminate a labor contract while the employee is within the stipulated medical treatment period.

04 If an employer terminates a contract after the medical period ends, is economic compensation required?

Case:

David joined an automotive company in June under a three-year contract and worked in market planning. At the end of August, he suffered fractures in an accident in his residential community.

David's medical treatment period is about to end, but due to the severity of his injuries, he has not yet recovered sufficiently to perform his original duties or any other tasks reassigned by the company. The company is considering terminating his contract. In such a case, is the employer required to provide economic compensation ?

Answer:

According to the Labor Contract Law of the People's Republic of China, if an employee is unable to perform their original duties or other tasks reassigned by the employer after the medical treatment period ends due to illness or non-work-related injury, the employer must provide economic compensation upon termination of the contract.

Note:

Economic compensation is calculated based on the employee's years of service at the company. For each full year of service, the employee is entitled to one month's wage. Periods between six months and one year are counted as one year. For periods less than six months, the employer should pay half a month's wage.

Q: Are there additional payments required beyond economic compensation after the medical period ends?

A: Yes. According to Shanghai's labor contract regulations, in addition to economic compensation, the employer must provide a medical subsidy equal to no less than six months of the employee's wage.

Note:

This rule applies to cases where the employee cannot perform their original duties or other reassigned tasks after the medical period ends.

05 Can a labor contract be terminated if it expires, but the medical period hasn't ended?

Case:

Jane joined a catering company as a marketing manager on Dec 1, 2022, under a three-year contract. Since September, she has experienced back pain and was diagnosed with a chronic condition requiring rest on Nov 1, 2025. Her doctor issued a two-month medical certificate for sick leave from Nov 1 to Dec 31, 2025. However, her labor contract is set to expire at the end of November 2025. Can the employer terminate the contract at that time?

Answer:

According to the Labor Contract Law of the People's Republic of China, when an employee is ill or has a non-work-related injury within the stipulated medical treatment period, the contract must be extended until the medical period concludes. This means the contract can only be terminated once both periods have ended.

In Jane's case, although her labor contract expires on Nov 30, 2025, her medical treatment period extends until Dec 31, 2025. Therefore, her contract must be extended until Dec 31, 2025.

We hope this guide answers your questions. We wish you good health and a pleasant stay in Shanghai.

Sources: Official WeChat account of the Shanghai Municipal Human Resources and Social Security Bureau at "shrsjwx", VCG. The cover image was generated with AI.