
China
China is a country in East Asia. It is the largest Asian country with the most people on the planet. It occupies almost one-fourth of the Earth's land area, occupying nearly the whole East Asian landmass. Only Russia and Canada have a larger land area than China, and it is nearly as huge as the entire continent of Europe.
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Why work in
China
?
Despite the People's Republic of China being the world's largest player in manufacturing, the sheer volume of goods with the "made in China" label is simply staggering. The country is also popular among foreign corporations looking to expand their remote workforce.
Not only are salaries fairly cheap in China, but legal conditions are quite favourable for companies, as employee protection and health and safety duties are not as stringent as in other countries. In many circumstances, hiring in China entails low labour expenses and low pay in exchange for highly skilled individuals.
Through the Gloroots’ Recrew platform, you can discover amazing talent in the China.

Grow your team in
China
Employers in China must have a local legal organization and utilize local resources to handle compliance, payroll, tax, and benefits management. The complexity of employment regulations in China makes compliance with employment laws demanding.
With Gloroots' global Employer of Record (EoR) service, you can let Gloroots handle the heavy lifting of payroll, tax, benefits, and compliance, allowing you to concentrate on what matters most: your employees and company growth.
Risks of misclassification
Navigating the complexities of employee classification is crucial when operating in China. Misclassifying workers can lead to legal liabilities and financial penalties. To safeguard your business, partnering with a reputable PEO/EOR in China is a wise choice.
By engaging a PEO/EOR, you ensure compliance with Chinese labor laws, accurate employee classification, and seamless payroll processing. These experts handle comprehensive benefits and ensure that your workforce receives the legal protections and entitlements they deserve. Focus on your core business operations while entrusting employment-related obligations to trusted professionals in China.
Employing in
China
To establish a successful employment framework in China, it is crucial for businesses to familiarize themselves with Chinese employment and labor laws. This includes understanding minimum wage requirements, working hour regulations, employee benefits, statutory leaves, and contractual obligations. Accurate and compliant payroll management, as well as adherence to proper termination procedures, are also essential.
Staying informed about these laws promotes a harmonious work environment, safeguards employee rights, and minimizes legal risks. Seeking guidance from legal or HR experts with expertise in Chinese labor regulations is highly recommended to ensure compliance and successful employment practices in China.
If you do not have the in-house compliance and payroll experts to do this, engage with with Gloroots’ China EOR.
Legal aspects of employing in
China
Working hours
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Payroll
EMPLOYMENT CONTRACT
Employers and workers must abide by the Labor Law of the People’s Republic of China .
According to China's Labor Contract Law, employers are required to provide their employees with a written employment contract within one month of their start date, with different regulations applying to part-time employees.
Employment contracts in China can be established for a fixed-term, indefinite term, or for the duration necessary to complete a specific assignment. The agreement should include, at a minimum, the following details:
1. Identification of both parties involved
2. Start date and duration of employment
3. Workplace location
4. Job description, including position, duties, and responsibilities
5. Basic salary and any additional compensation or benefits
6. Working hours
7. Total number of holidays
8. Social insurance coverage
9. Workplace safety and protective measures
10. Any additional legal requirements
Optional information that can be included in the contract relates to probation periods, confidentiality agreements, training arrangements, and other relevant provisions.
This might sound overwhelming, but it doesn't have to be. Gloroots eliminates these barriers for you. With Gloroots' Employer of Record offering, hiring and managing employees globally is a piece of cake.
Get an overview of what you need to know when hiring in China. Contact us.
Overtime
According to Chinese regulations, employees may engage in overtime work under specific circumstances, but the duration should not exceed one hour per day, or three hours per day in special cases, while being limited to a maximum of 36 hours within one month. Compensation for overtime work is determined as follows:
Minimum Wage:
In China, minimum wages vary with each - based on the cost of living in different areas.
Among the provinces, Shanghai has the highest monthly minimum wage rate, currently set at CNY 2,590 per month. However, when it comes to the highest hourly minimum wage, Beijing takes the lead, requiring employers to pay CNY 25.3 per hour.
Annual Leave:
The number of paid vacation days an employee is entitled to depends on their tenure with the company. Employees who have completed one or more years of service receive five days of annual leave. For employees with a tenure ranging from ten to twenty years, their annual leave increases to ten days. Those who have been with the company for more than 20 years enjoy a generous entitlement of 15 paid days off each year.
Maternity Leave and Paternity Leave
China's legal provisions for parental leave underwent a reform in 2016, resulting in an extension of the basic maternity leave entitlement of 98 days. The duration of maternity leave can vary by province, with some provinces offering an additional 30 days. More recently, in November 2021, certain provinces, such as Shanghai and Beijing, have introduced even more generous maternity leave policies, extending the duration to 158 days.
During maternity leave, employees receive maternity benefits from the Chinese social security agency. Depending on the province, employers may be required to contribute to maternity allowances.
While there is no national law mandating paternity leave, fathers in China can claim paid leave following the birth of their child under provincial regulations. Most provinces grant fathers up to 20 days of paternity leave. In some regions, there is even the option for the mother to transfer her unused maternity leave to the child's father.
It's important to note that specific parental leave entitlements and requirements may vary by province, and employers should consult the relevant local regulations to ensure compliance with the applicable provisions.
Sick Pay:
In China, the entitlement to sick leave and sick pay is determined based on the employee's tenure with their current employer and their overall work experience. The duration of sick leave can range from three months to 24 months, while the rate of sick pay varies between 60% and 100% of the employee's regular salary. The specific sick leave entitlements and corresponding pay rates are outlined in the following table:
Tax
INCOME TAX
Note: CNY stands for "Chinese Yuan," which is the official currency of China.
Other Taxes and Social Security contribution:
Please note that the contribution rates and components may vary depending on the specific location in China. The example provided here is based on the rates in Shanghai.
Separation
Termination Process:
In China, terminating employment contracts requires valid reasons and the provision of severance payments to the affected employees as per legal requirements.
Notice Period:
Employers are generally required to give a one-month notice.
Severance Pay:
Employees are eligible to receive a month's salary for each year of service, where any period less than six months is considered as a year. In cases of termination with less than six months' tenure, employees are entitled to half a month's salary.
Probation Periods:
The duration of probation periods may vary depending on the specific terms of the employment agreement, ranging from one month to six months.