Motorcycle Parts Factory Ordered to Pay 52,300 RMB in Workplace Injury Benefits After Appeal Dismissed

Motorcycle Parts Factory Ordered to Pay 52,300 RMB in Workplace Injury Benefits After Appeal Dismissed

Case Overview

An appellate court in Eastern China upheld a lower court ruling requiring a motorcycle parts factory to pay a former employee 52,300 RMB in workplace injury benefits. The employee suffered a severe hand injury while operating a press at the factory. The court confirmed that the employer must provide specific benefits including medical and employment subsidies, wages during the recovery period, and related expenses. The employer had argued for lower payment calculations based on social insurance contribution levels, but the court rejected this argument.

Case Background and Facts

In February 2009, Mr. Peng began working at a motorcycle parts factory in Eastern China. He was assigned to a die-casting position with piece-rate wages. The factory had enrolled Mr. Peng in work-related injury insurance. On April 16, 2009, around 3 PM, Mr. Peng suffered a severe crush injury to his left hand while operating a die-casting machine. He was hospitalized for 108 days at a local orthopedic hospital. The hospital issued a medical certificate confirming he needed six months of rest after discharge and required one caregiver during hospitalization. Doctors diagnosed fractures of the left wrist, metacarpal bones, and distal radius requiring internal fixation surgery. The injury resulted in impaired thumb extension and flexion along with joint deformities. On June 22, 2009, the local human resources and social security bureau recognized this as a work-related injury. On June 11, 2010, the city labor ability appraisal committee classified the injury as a Level 7 disability. The factory paid all hospitalization costs but left 20 RMB in outpatient expenses unpaid. The factory also provided 5,700 RMB in compensation. When Mr. Peng requested his full benefits, the factory had not yet applied to the social insurance center for the lump-sum disability payment. Mr. Peng then filed for arbitration.

Court Proceedings and Evidence

The case first went to the Eastern China Labor Dispute Arbitration Commission, which ruled in favor of Mr. Peng on August 27, 2010. The arbitration decision required the factory to process insurance procedures at the social insurance center and pay Mr. Peng 58,080.31 RMB in total benefits, minus the 5,700 RMB already paid, leaving 52,380.31 RMB. The factory challenged this ruling in court. The original trial court heard the case and reviewed medical certificates, the disability appraisal, and wage evidence. The factory argued that benefits should be calculated based on the social insurance contribution wage of 1,259.90 RMB per month. Mr. Peng argued for higher amounts based on local average wages. The trial court ruled against the factory, which then appealed to the intermediate court. The appellate court held a public hearing on January 18, 2011, with both parties and their legal representatives present.

Court Findings and Judgment

The appellate court affirmed the trial court decision in full. The court found that Mr. Peng was entitled to work-related injury benefits because the injury occurred during work hours and was officially recognized as a work injury. The court held that the factory failed to provide wage records for Mr. Peng. Therefore, the trial court correctly used the 2009 local labor market wage guidance rate of 1,350 RMB per month to calculate the wage during the recovery period, totaling 12,960 RMB. The court determined that Mr. Peng was entitled to a lump-sum medical subsidy of 20,500 RMB and a lump-sum employment subsidy of 20,500 RMB. These amounts were calculated based on the local average monthly wage for the previous year in the social insurance pooling area. The court rejected the factory argument that these subsidies should be based on the social insurance contribution wage. The court also approved 3,720 RMB for nursing care during hospitalization, 20 RMB for unpaid outpatient expenses, and 300 RMB for transportation. After deducting the 5,700 RMB already paid, the factory was ordered to pay 52,300 RMB.

Key Legal Principles

The court applied the principle that when an employee is injured at work and classified with a Level 7 to Level 10 disability, the employer must pay a lump-sum medical subsidy and a lump-sum employment subsidy if the employment contract ends or the employee requests termination. The calculation of these subsidies must follow the average monthly wage of the previous year in the social insurance pooling area, not the individual contribution wage. For calculating wages during the recovery period, when the employer fails to provide wage records, the court may use local labor market wage guidance rates. The court also confirmed that the lump-sum disability payment from the disability fund is separate from the employer-paid subsidies.

Practical Insights

This case demonstrates that employers must maintain accurate wage records for employees. Failure to provide such records can result in courts using higher local wage standards to calculate benefits. Employers should also understand that social insurance contribution wages may not limit their liability for certain benefits. The distinction between benefits paid from the insurance fund and those paid directly by the employer is critical. Businesses should ensure timely processing of insurance claims to avoid additional liability.

Legal References

Regulations on Work-Related Injury Insurance (2010 Revision): Article 35, Article 61. Labor Law of the People’s Republic of China: Article 73. Civil Procedure Law of the People’s Republic of China: Article 153. Zhejiang Provincial Government Notice on Implementing Work-Related Injury Insurance Regulations: Article 2, Paragraph 5.

Disclaimer

This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for specific legal matters.