As part of a major policy shift on family planning announced earlier in 2021, married couples may now have up to three children. In support of this policy, some provincial and municipal governments, including those of Beijing and Shanghai, are expanding maternity leave entitlements provided by social security. Paternity leave entitlements have not been changed, but both city governments have introduced new employer-paid parental leave entitlements.
The decision to allow married couples to have up to three children is intended to address demographic changes that have resulted in a shrinking (albeit still huge) workforce and rapidly aging population. The country’s birth rate dropped to 8.5 births per 1,000 people in 2020, the lowest rate in 40 years according to the government. Employers surveyed by Willis Towers Watson generally don’t provide paid maternity leave in excess of statutory requirements and rarely provide paid parental leave.
Companies with employees in Beijing and Shanghai should review their existing leave policies and budget planning to ensure that they comply with the new legislation. Since Beijing’s regulation is more flexible, i.e., extended maternity and parent leaves can be shared between the parents, as well as additional maternity leaves of up to three months (upon employer’s decision), employers will be required to make more detailed implementation rules and employee communications.