Towards the end of the year, the engineering construction industry will usher in the settlement peak of project payments and wages. The issue of wage arrears for migrant workers has once again attracted social attention. Wage remuneration has always been the most direct and core rights and interests of migrant workers, and it is also a major issue related to the basic livelihood of migrant workers' families. In recent years, through the efforts of various regions and relevant departments, the frequent occurrence of wage arrears has been effectively curbed, but the phenomenon of wage arrears to migrant workers still occurs in some places. In order to speed up the problem of arrears of wages for migrant workers, the country issued the "Regulations on Guaranteeing the Payment of Wages to Migrant Workers" in January 2020; in December 2020, the General Office of the State Council issued the "Guidance on Further Improving the Distrust Constraint System and Building a Long-term Mechanism for Integrity Construction" Opinions", through the management method of joint punishment for breach of trust to curb the occurrence of wage arrears.

The "Interim Measures for the Management of the List of Joint Punishment Targets for Untrustworthy Wage Arrears for Migrant Workers" announced by the Ministry of Human Resources and Social Security this time will implement the "credit mechanism" into the special field of arrears of wages for migrant workers, and provide guidance for the Ministry of Human Resources and Social Security to carry out The joint disciplinary management of wage arrears and breach of trust provides a legal basis for the implementation of restraints on wage arrears and breach of trust, promotes the establishment of a long-term credit supervision mechanism for the management of migrant workers' arrears of wages, and provides new solutions to the management of migrant workers' arrears of wages across the country.

Credit risk analysis of migrant workers' unpaid wages

In the field of construction engineering, engineering projects have large investment amounts, long construction periods, and many changing factors, so objectively there is a high credit risk. Any breach of trust by either the contracting party or the contractor will directly lead to wage arrears for migrant workers.

Contract issuing party: arrears of project payment

The contract issuing party is unable to release the project payment in full and on time due to problems such as tight capital chain, which will cause the general contractor and subcontractors to have funds In the case of arrears, migrant workers are at the bottom of the capital chain and are directly affected. For some projects, progress payments are allocated according to the contract. However, because the allocation ratio stipulated in the contract is low or there are temporary changes, there is a large gap between the project funds allocated and the actual construction unit, which will lead to disguised differences between the general contractor and the subcontractor. The arrears of funds have resulted in the arrears of wages for migrant workers.

Contractors: Winning bids at low prices & subcontracting at different levels

The construction market is highly competitive, and some contractors will obtain projects through winning bids at low prices, which makes the project profitable. It is limited and cannot guarantee the economic benefits of the underlying construction units, nor can it ensure the timely and full payment of wages to migrant workers. In addition, after winning the bid for a project, some contractors will allocate it to some unqualified "foremans" through subcontracting. In this case of layered subcontracting, wages will not be directly paid to the front-line workers who actually operate. Implementation, and the wages of migrant workers must wait until the "contractor" settles the project payment with the contracting unit before they can be paid. There are too many subcontracting of project construction labor services, resulting in more payment links and profit distributions, resulting in migrant workers' wages being in arrears.

The problem of migrant workers’ unpaid wages is caused by the untrustworthy behavior of both parties. It is essentially a credit problem. The root cause is a weak concept of credit, asymmetric credit information, and a lack of credit supervision methods. In recent years, with the continuous improvement of the credit system of the country and the construction market, conditions have been provided for the country to use innovative management methods of credit supervision to solve the problem of migrant workers' unpaid wages.

How to control migrant workers’ wage arrears through credit constraints

The essence of the market economy is a credit economy, and credit is the cornerstone of the market economy. The use of credit supervision methods to strengthen joint punishment for wage arrears and breach of trust is the fundamental solution. The fundamental means of arrears of wages. The "Management Measures" focus on the use of joint punishment for breach of trust and the establishment of a "blacklist" for punishment of breach of trust to deter wage arrears.

The issue of wage arrears has many emergencies and is difficult to deal with. The "Management Measures" have established a sustainable and long-term mechanism for credit supervision. Clearly being included in the system requirements for joint punishment for breach of trust is conducive to standardizing the management of untrustworthy behavior in arrears of wages. Article 5 of the "Administration Measures" stipulates two situations that are included in the list of punishment for breach of trust:

First, deduction, The unreasonable delay in arrears of wages to migrant workers reaches the amount standard for the crime of refusing to pay labor remuneration.

The second is the illegal behavior of arrears of wages to migrant workers, which triggered mass incidents and extreme incidents, causing serious adverse social impacts.

Once included in the list, the human resources and social security department will transfer the list of relevant employers to the credit information sharing platform, which will be used by relevant departments in government financial support, government procurement, bidding, financing loans, market Joint punishments will be imposed in accordance with laws and regulations in terms of access, tax incentives, priority evaluation, transportation and other aspects, and the maximum period can be up to 3 years. This not only forces the employment enterprises to "dare not owe wages", but also guides the enterprises to "not want to owe wages." ”, thereby creating a good atmosphere for honest employment.

In addition to the above-mentioned credit disciplinary measures, in recent years, the state has successively issued the "Regulations on Guaranteeing the Wage Payment of Migrant Workers" and the "Regulations on the Wage Security Deposit of Migrant Workers in the Engineering Construction Field", vigorously promoting the application of the "wage security deposit" system. Both the wage guarantee system itself and various innovative wage guarantee management and service methods (wage payment guarantee insurance for migrant workers) have increasingly shown significant "credit risk management" and "credit protection" functions, and can effectively prevent and respond to various types of farmers. The credit risk of employee wage payment also plays an important role in promoting the eradication of wage arrears.

Salary security deposit

Salary security deposit is a form of project guarantee, and it is also an important safeguard measure to solve the problem of wage arrears in the field of engineering construction. An account is established and stored according to a certain proportion of the project construction contract, and is used specifically to pay special funds owed to migrant workers who provide labor for the contracted projects. Once the contracting unit is in arrears with wages, the Ministry of Human Resources and Social Security will make repayments within a time limit in accordance with the law. If the Ministry of Human Resources and Social Security refuses to perform, it will ask the handling bank to perform the payment on its behalf and pay the wages of migrant workers.

Migrant Workers’ Wage Payment Guarantee Insurance

As an innovative management service method for wage guarantee funds, Migrant Workers’ Wage Payment Guarantee Insurance has played an important role in assisting regional governments in managing wage arrears and has been favored by Strong support and promotion at the national policy level. When deploying measures to ensure timely and full payment of wages to migrant workers, the State Council executive meeting emphasized the "comprehensive implementation of letters of guarantee (insurance) instead of guarantee deposits" to further promote the comprehensive market development of wage payment guarantee insurance for migrant workers.

On the one hand, the wage payment guarantee insurance for migrant workers can play a compensatory role in wage payment through insurance claims, ensuring that migrant workers’ wages are paid in time and in full; at the same time, the "Regulations on Wage Guarantee Deposits for Migrant Workers in the Field of Engineering Construction" stipulates , the wage payment guarantee for migrant workers should be an irrevocable demand guarantee to further strengthen the guarantee of wage payment for migrant workers.

On the other hand, migrant workers’ wage payment guarantee insurance can not only guarantee the payment of wages to migrant workers through insurance claims services, but also innovatively introduce third-party professional risk management services to participate in the risk management of the entire process of migrant workers’ wage payment. Strengthen the risk management of wage payment for migrant workers through pre-insurance, post-insurance and collaborative accident resolution.

The "Management Measures" were introduced at the right time to eradicate wage arrears in winter. By standardizing work procedures, strengthening credit constraints and punishments, etc., we will further improve the untrustworthy list management system and build a system that is in compliance with laws and regulations and balances leniency and severity. , a new pattern of wage payment credit supervision in an orderly manner, ensuring that the work of rooting out wage arrears is promoted in depth on the track of the rule of law, and the level of legalization of credit constraints on migrant workers' wages arrears is improved.