adidas-socialinsurancerevisingmemo_eng_june2012_(final)

1 Memorandum From Hilde Gunn Vestad, Regional Manager North Asia and Johnson Gong Area Manager Date 26 June 2012 Dept Social  By July 2013, suppliers should include and cover a minimum of 80 of their employees in the national social insurance scheme;  By July 2014, suppliers should include 100 of their employees in the national social insurance scheme. 2 3. We are allowing the progressive inclusion of workers into the national social insurance scheme on the condition that suppliers ensure that 100 of their workforce are protected at all times against work injury, and are provided with medical and maternity benefits equivalent to those that can be secured through the government-mandated social insurance scheme. To fulfill this requirement, suppliers may make use of private insurances or reimburse medical/maternity charges to cover those workers who are not yet registered into their local social insurance scheme. Workers should not be required to make any financial contribution towards the private insurances purchased to provide this cover. Suppliers are responsible for covering 100 of the expenses incurred for medical/maternity charges and compensation including any “excess” stipulated in the private insurance policy, or any gap between the compensation offered by a private insurance policy and the equivalent national social insurance coverage. 4. If local labour authorities require suppliers to register a greater percentage of their workforce into the social insurances scheme, compared to the coverage given in the SEA-specified milestones, suppliers shall follow the requirements set by local government. As in all matters related to our Workplace Standards, it is always the highest standard that applied. 5. We do not accept waivers issued by local labour officers to mpt suppliers from registering part, or all, of their workforce under the government-mandated five social insurances. Unless local social insurance infrastructure is underdeveloped, resulting in a certain category of social insurance not being currently available to employers in a given locality, we require 100 coverage of the five categories of social insurances for all workers who are registered into the national scheme, regardless of whether they are permanent employees or have contract status. The one exception to this requirement is where workers pension entitlements are secured through farmers insurance, as described below. 6. Supplier may register workers into farmer pension insurance scheme. However, to supplement this insurance, suppliers must also register workers into the four other categories of the national social insurance scheme. Suppliers should keep all records of registration into farmer/social insurance scheme for previous 3 years, on-site for verification. Suppliers are responsible for covering the full cost of farmer pension insurance and workers should not be required to make a contribution. Suppliers should ensure that wher