China

Employer of Record (EOR) in China

Only 299 EUR per employee per month

Rivermate's Employer of Record (EOR) solution helps companies hire remote employees in China . We take care of global payroll, taxes, benefits, compliance and HR activities. So you can focus on growing your business. Our Employer of Record (EOR) solution is beneficial to companies that want to hire remote employees in a breeze. On this page you will find employment information for China.

Employer of Record people
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Currency
Chinese Yuan Renminbi
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Capital
Beijing
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Region
Asia
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Language
Chinese
Hire remote employees
Population
1439323776
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GDP
$12.238 trillion
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GDP growth
0.069
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Ease of doing business
77.9
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World GDP share
0.1512

1. Grow your team in China with Rivermate as your Employer of Record (EOR) / PEO

Payroll, benefits, taxes, and compliance can be difficult to manage in China , particularly if you don't have established local relationships. You can hire employees in China effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global Employer of Record (EOR) solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

2. Summary

China, formally the People's Republic of China, is an East Asian nation. With a population of over 1.4 billion people, it is the world's most populated nation. China encompasses five geographical time zones and borders 14 nations, second only to Russia in the globe. It is the world's third or fourth biggest nation, with a size of around 9.6 million square kilometers (3,700,000 square miles). There are 23 provinces, five autonomous regions, four municipalities, and two Special Administrative Regions in the nation (Hong Kong and Macau). Beijing is the national capital, while Shanghai is the biggest city.

China arose as one of the world's earliest civilizations in the rich Yellow River valley of the North China Plain. From the first through the nineteenth centuries, China was one of the world's top economic powers. China's political structure has been founded on absolute hereditary monarchy, or dynasties, for millennia, starting with the semi-legendary Xia dynasty in the 21st century BCE. China has grown, divided, and reunified countless times since then. The Qin unified central China and formed the first Chinese empire in the third century BCE. The Han dynasty (206 BCE – 220 CE) featured some of the most sophisticated technologies of the period, including papermaking and the compass, as well as agricultural and medicinal advancements. The Tang and Northern Song dynasties (618–1127) completed the Four Great Inventions by inventing gunpowder and moveable type. As the new Silk Road attracted merchants as far as Mesopotamia and the Horn of Africa, Tang culture-expanded across Asia. The Qing dynasty, China's final dynasty and the foundation of modern China suffered tremendous losses to the Western empire in the nineteenth century.

The Xinhai Revolution, which toppled the Qing dynasty in 1912, brought the Chinese monarchy to an end. In 1937, Japan invaded China, launching the Second Sino-Japanese Conflict and briefly putting an end to the civil war between the Chinese Communist Party (CCP) and the Kuomintang. The surrender and expulsion of Japanese troops from China in 1945 created a power vacuum in the nation, resulting in fresh conflict between the CCP and the Kuomintang. The civil war concluded in 1949 with the split of Chinese territory; the CCP created the People's Republic of China on the mainland, while the ROC government fled to Taiwan. Both claim to be China's only legal government, despite the fact that the UN has recognized the PRC as the sole representative since 1971. Since 1978, China has implemented a series of economic reforms and joined the World Trade Organization in 2001.

The CCP presently governs China as a unitary one-party communist country. China is a permanent member of the United Nations Security Council and a founding member of several multilateral and regional cooperation organizations, including the Asian Infrastructure Investment Bank, Silk Road Fund, New Development Bank, Shanghai Cooperation Organization, and RCEP, as well as a member of the BRICS, G8+5, G20, APEC, and the East Asia Summit. It is among the lowest in worldwide rankings of civil liberties, government transparency, press freedom, religious freedom, and ethnic minorities. Political dissidents and human rights advocates have condemned Chinese authorities for severe human rights violations, including political persecution, mass censorship, mass monitoring of its populace, and violent suppression of rallies.

China has the world's biggest economy in terms of GDP at purchasing power parity, the world's second-largest economy in terms of nominal GDP, and the world's second-wealthiest nation. The nation is the world's top producer and exporter, and it has one of the fastest expanding global economies. China is a nuclear-weapon state with the world's biggest standing army in terms of military manpower and the world's second-largest defense budget.

Hiring talented employees in a short span is not an easy task. Partnering with an Employer of Record (EOR) like Rivermate in China is your best option, giving your organization enough time to focus on other aspects of international expansions like project management and inventory management. The EOR takes care of all the compliance and legal issues while helping you speed up hiring using their knowledge of domestic employment practices and virtual onboarding tools. Top EORs also have provisions for the e-signing of documents to enable faster onboarding.

3. Public holidays

4. Types of leave

There is no information about the types of leave for this country.

Paid time off

The period of work is used to measure paid time off:

There is no entitlement to resign if you have been working for less than a year.

5 days of voluntary leave for employees who have worked for 1 to 10 years.

10 days of voluntary leave after 10-20 years of work

After 20 years of service, you are entitled to 15 days of paid leave.

Public holidays

There are seven national holidays, with extra holidays in certain countries.

Sick days

Pay for sick leave varies depending on duration of service:

Sick leave for six months:

Employed for less than two years: 60% of the average hourly pay

70 percent of daily earnings after 2-4 years of work

4-6 years of work experience: 80% of the average hourly rate

6–8 years of experience: 90% above the average hourly rate

After 8 years of service, you can get 100% of your daily pay.

Sick leave of more than 6 months:

40 percent of daily pay for less than a year of work

50% of daily income after 1-3 years of work

After three years of service, you will be paid 60% of your daily salary.

A medical card is required for all employees.

Maternity leave

A female employee is entitled to 98 days of maternity leave, with an extra 15 days if the delivery is painful or multiple births are occurring. Women who give birth after the age of 23 could be eligible for extra maternity leave in some cities.

Maternity leave is compensated by the Social Security Bureau where the individual is enrolled and is calculated based on an average monthly wage for the preceding 12 months. This rate or three times the minimum wage would be paid by Social Welfare, whichever is higher. Employers in some countries, such as Beijing and China, complement maternity pay with extra pay.

Paternity leave

When paid paternity leave is taken, fathers are entitled to ten days of paid paternity leave. Additional paternity leave is available in some cities.

Parental leave

For infants under the age of 12 months, nursing mothers are entitled to one hour off every day.

Other leave

Marriage Leave: Each city has its own set of rules, which range from 3 to 10 days. Employees in Beijing and Shanghai are entitled to ten days of marriage leave.

Bereavement Leave: It varies by city and can take anywhere from one to three days.

5. Employment termination

There is no information about employment information for this country.

Termination process

In China, a contract may not be permitted to end unless all parties concur or the contract expires.

Notice period

Both the employee and the employer have a right to 30 days' notice in advance. Three days' notice may be given, however, if the employee is on probation.

Probation period

The probation period is determined by the length of the employment contract. For employment contract of 3 months to a year, a maximum of 1 months’ probation is administered. For employment contracts of 1 to 3 years, a maximum of 2 months’ probation is administered. For employment contracts of 3 years or more, up to 6 months’ probation is administered. For employment contract for less than 3 months or that expire upon completion of assignment, probation is not permitted.

Severance pay

Severance pay varies according to the reason for termination, but in general, it is one month's income for each year of service, limited at three times the minimum wage, and not to exceed twelve months.

6. Working hours

There is no information about the working hours for this country.

General working schedule

In China, the standard workday is eight hours and no more than 44 hours per week. Employers may adopt different work hours in exceptional circumstances and with the Labor Department's approval.

Offices are typically open from 8 a.m. to 6 p.m. each day, with a two-hour lunch break between noon and 2 p.m., although hours vary by city. Government offices are open Monday through Friday from 9 a.m. to 5 p.m. and are closed on weekends.

Overtime

Overtime is limited to one hour per day, but may be extended to three hours in exceptional circumstances, up to a total of 36 hours per month. Overtime pay for workdays is 150 percent of the regular rate, 200 percent on rest days, and 300 percent on official public holidays.

Employees with flexible work hours are generally not entitled to overtime pay, but this is subject to labor bureau approval.

7. Minimum wage

There is no information about the minimum wage for this country.

The minimum wage in China varies by province and city. For example, as of 2021, Shanghai has the highest monthly minimum wage of 2,480 yuan, followed by Shenzhen at 2,200 yuan and Guizhou at 1,570 yuan. Employers typically pay employees on a monthly basis, either in cash or via a bank transfer.

Although a 13th-month bonus or salary is not required by law, it is a market norm in China. Instead of a guaranteed bonus, you can state in the employment contract the monthly salary, the frequency with which employees will be paid, and the total annual salary. You can then specify that a bonus is optional but will be distributed if certain conditions are met. Salespeople frequently receive a commission plan in lieu of this bonus.

8. Employee benefits

There is no information about the employee benefits for this country.

The national system provides basic health and pension insurance; however, extra health insurance may be supplied to the employee.

Employers in China contribute to a housing fund, which is similar to a 401k plan. Employees' real estate rent and purchase costs are subsidized by the fund. Some contributions are required; nevertheless, employees typically bargain for a higher housing fund rate. Employers are typically required to contribute between 5% and 25% of an employee's annual wage. Distinct cities have different policies concerning the housing fund.

It is difficult to provide stock options to employees in China. We strongly advise you to consider if it is "worth" delivering this bonus to your Chinese staff before doing so.

9. Taxes

There is no information about the taxes for this country.

Corporate tax

The standard corporate tax rate imposed on companies in China is 25 percent. The concession rate for high-technology companies is 15 percent.

Individual income tax

Individuals in China are imposed an income tax rate between 0 percent and 45 percent. The actual percentage depends on the income bracket the individual belongs to.

VAT, GST and sales tax

The standard rate for the value-added tax (VAT) or goods and sales tax (GST) in the China is set at 13 percent. The rate is different for services like energy, books, and transportation which is set at 9 percent. Goods and services for export are tax-free.

10. VISA and work permits

There is no information about VISA and work permits for this country.

The visa must be sponsored by the employer, who must be a recognized firm that hires foreign workers. The employee must be a foreign specialist in the subject in which they would be working.

In China, there is an age restriction for both male and female candidates for a work visa; male applicants must be between the ages of 24-65, while female workers must be between the ages of 24-55. The employer must provide the employee with a government-issued work permit and visa notification letter, which must be signed and sent to the Chinese government.

A Z Visa is only valid for 30 days after arrival, after which the employer must apply for a temporary residence visa on the employee's behalf. The Z visa is valid for 90 days to a maximum of 50 years.

Other visa alternatives include the R Visa, which is designed for highly talented individuals in high demand in China, and the J Visa, which is designed for journalists. Typically, the procedure takes around 8 weeks to complete.

11. Employer Of Record service terms

There is no information about the Employer of Record (EoR) service terms for this country.

Employment contracts

In China, it is essential to have a robust employment contract in place that specifies out the conditions of the employee's remuneration, benefits, and termination obligations. In China, the salary and other compensation amounts should always be stated in Chinese Yuan Renminbi rather than a foreign currency in an offer letter and job contract.

With Rivermate being your Employer of Record (EoR) in China, you do not have to worry about the employment contracts, as we take care of that.

Minimum assignment length

In China, both fixed-term and non-fixed-term contracts are permitted. A non-fixed term contract exists when an employee agrees to extend an employment contract after at least ten years of service, unless the employee expressly agrees to a fixed term contract. A contract is considered non-fixed term if the employer fails to sign it within one year of the employee's start date.

Payment currency

Renminbi (RMB)

Chinese Yuan (CNY)

13.Opening a subsidiary in China

There is no information about the working hours for this country.

How to set up a subsidiary

For international corporations, China has three typical business structures:

A joint venture (JV) is a cooperation between international and Chinese investors. It is a kind of foreign-invested business (FIE). Profits, losses, and management responsibilities are shared by these investors. Companies that need the assistance of a local business partner for distribution, government contacts, or market understanding often pick this option.

Representative office (RO): An RO is the simplest and least costly choice since it does not need any registered capital. It has a restricted commercial scope and is only permitted to conduct market research, public relations, sales, and service operations inside the nation.

WFOE (wholly foreign-owned enterprise): A WFOE is a limited liability company formed and financed entirely by foreign citizens. This option is often chosen by businesses that wish to manufacture a parent company's product in China and export it to a foreign nation.

The procedure of establishing a subsidiary in China is dependent on the option you choose.

WFOEs are the most common company structure used by US corporations wishing to set up a Chinese subsidiary. To establish a WFOE, you must first complete the necessary legal papers, such as articles of incorporation, audit reports, and letters of authorisation, as well as create bank accounts in China and select a legal representative.

Subsidiary laws

Although WFOEs are not required to have any minimum registered capital, some sectors may still have these criteria. Subsidiary regulations in China, such as the minimum registered capital requirement, differ by city.

All international investors must retain a PRC corporation to serve as the company's sponsor. Because investors cannot file for incorporation papers directly, the PRC organization — such as a local authorized Foreign Enterprise Service Company (FESCO) — is in control of the application procedure.

13. Why choose Rivermate as your Employer of Record / PEO in China

Establishing an entity in China to hire a team takes time, money, and effort. The labor law in China has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into China simple and effortless. We can assist you with hiring your preferred talent, managing HR and payroll, and ensuring compliance with local legislation without the hassle of establishing a foreign branch office or subsidiary. Our PEO and Global Employer of Record (EOR) solutions in China give you peace of mind so you can focus on running your business. Please contact us if you'd like to learn more about how Rivermate can help you hire employees in China via our Employer of Record (EOR) / PEO solution.

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