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On The Legel Mechanism Of China Enterprise Annuity Distribution

Posted on:2011-11-27Degree:DoctorType:Dissertation
Country:ChinaCandidate:Q LiuFull Text:PDF
GTID:1116330368478605Subject:Demography
Abstract/Summary:PDF Full Text Request
Annuity distribution is an important component of enterprise annuity system. In annuity system, pension of the plan participants, to a certain degree, depends on the matching distribution allocated to them. Based on a study of the interest conflicts in enterprise annuity system, this thesis analyzes the flaws of the present enterprise annuity system, and proposes legal mechanism to solve the interest conflicts with reference to valuable foreign experience.Interest conflicts can be classified into three types, the first type of which is caused by inconsistent objectives; the second type asymmetric information; the third ethical hazard. Those conflicts make it impossible for the employees who are in a weak position to be protected by the annuity system. As a result, it poses problems for the practice of the annuity system, such as limited beneficiaries, narrow coverage and infringement of the plan participants'rights, which become the logical starting point for my study on the legal system of the enterprise annuity system.To solve the potential problems in annuity distribution, the present annuity system has created two institutional arrangements:collective bargaining and record review. However, due to its inherent flaws and the constraints of the institutional environment, the present legal system of the annuity distribution cannot effectively settle the interest conflicts in the enterprise annuity distribution. The problem of the collective bargaining consists in the fact that both labor and capital are not ideologically prepared to fulfill their obligations earnestly, especially the capital side; consequently, they show little respect for the collective bargaining. In fact, trade unions, the organization for the labor, don't effectively constrain the capital. Moreover, bargaining representatives who are supposed to represent the labor are actually not elected by the labor according to their own opinions, so they fail to faithfully perform their duty. Meanwhile, legal responsibility that guarantees collective bargaining to be carried out smoothly and to fulfill its duty is not clearly stipulated, which prevents the system from being effective. On the other hand, the registration authority only has formal reviews on annuity plan, and when it comes to how to distribute the annuity, it doesn't have legitimate right to review owing to the absence of the specific standard. Therefore, it's hard to ensure a fair distribution. At the same time, the registration authority is simply an agency commissioned to administrate. Based on principal-agent theory, its review lacks enough legal restriction and has greater discretion. To some extend, its review depends on the administrators'sense of fairness and justice which is difficult to ensure.By examining some sophisticated foreign enterprise annuity systems, we find that no matter the country adopts voluntary enterprise annuity system, compulsory enterprise annuity system or quasi-compulsory enterprise annuity system, the government will intervene in annuity distribution. The only difference lies in the extent and intensity of the intervention. Some country stipulates distinctly requirements of distribution, while others provide tax incentives for those enterprises which meet certain allocation standard.According to stakeholder theory and law and order theory, enterprise annuity has changed from pure economic rights of an enterprise into social responsibility shouldered by an enterprise. Therefore, the legal mechanism for the enterprise annuity distribution in our country should take into account the interests of the country, enterprise and individual, adopt quasi-compulsory enterprise annuity system, stipulate mandatory institutional arrangements when interests of all parties are involved, and specify legal liability by requiring obligations of the executives so as to achieve fairness in annuity distribution.
Keywords/Search Tags:enterprise annuity distribution, a balance of interests
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