China

China, officially the People's Republic of China, is the most populous country in the world and the second-largest economy by nominal GDP. Located in East Asia, it has a diverse industrial base, a highly structured legal framework, and rapidly evolving employment laws. As a key global manufacturing and technology hub, China presents significant opportunities for businesses looking to hire and expand. However, navigating its employment landscape requires careful attention to local regulations, which often vary by province and municipality.
Contractor Management
EOR
Payroll
Contractor of Record
Currency
Chinese yuan (CNY)
Payroll Frequency
Monthly
Employer Taxes
39.56 to 40.922% (Beijing)

Overview

Population
1.4 billion
Language
Mandarin Chinese (Putonghua)
Capital
Beijing
Currency
Chinese yuan (CNY)
Country code
+86
Min wage
Varies by province and city (e.g., ¥2,320/month in Shanghai; ¥1,920/month in Beijing)
Working hours
8 hours per day
Weekdays
Monday to Friday
Work hours per week
40 hours per week

Payroll

Salaried Employees
Monthly, with salaries typically paid by the end of each month
Time-Based Employees
13th Salary
Avg employer tax

~30%–40% of gross salary

Tax Breakdown

Employer Social Insurance Contributions: Varies by city, but commonly includes:

Pension Insurance
~16%
Medical Insurance
~10%
Unemployment Insurance
~0.5%–1%
Work-related Injury Insurance
~0.2%–1.9% (industry-based)
Maternity Insurance
~0.8%
Housing Fund
5%–12% (varies by city)

VAT

VAT

13% for goods, 6%–9% for services (VAT policies may vary by sector and location).

Tax Calculation for China
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Employer cost
Total monthly cost of employment
Gross monthly salary costs
Estimated taxes and contributions
Employee cost
Net monthly salary
GBP 5,137
Gross monthly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Employer cost
Total yearly cost of employment
Gross yearly salary costs
Estimated taxes and contributions
Employee cost
Net yearly salary
GBP 5,137
Gross yearly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Request a detailed quotation
How it works

Onboarding Process

Onboarding in China typically includes the following steps to ensure a smooth transition for new hires:

Employment Contract

  • Must be written and signed within one month of employment start
  • Must include job title, compensation, working hours, location, social insurance, and termination conditions

Social Insurance Registration

Employers must enroll new employees in social security and housing fund schemes within 30 days

Tax Setup

Employers must register employees with local tax authorities for withholding purposes

Work Permits for Foreign Hires

  • Must obtain a Z-visa and work permit before onboarding
  • Residence permit required within 30 days of arrival

Employee Orientation

  • Introduce company culture, code of conduct, internal policies, and reporting lines
  • Provide training for health and safety, data protection, and job-specific tools

Probation Period Review

Employers should conduct a performance review before probation ends and decide on confirmation, extension, or dismissal

Pre-boarding

Pre-boarding

Pre-boarding

Key Elements of an Employment Contract in China
When drafting an employment contract for employees in China, the following key elements should be included:

Personal Details

Name, contact information, and role of the employee.

Employee Leave Policies

Sick days
  • Sick leave duration and pay vary by tenure and local policy.
  • Employees are usually paid 60%–100% of salary (or based on local average) during sick leave.
  • Medical certificates are mandatory.


Maternity leave
  • Standard Duration: 98 days, including 15 days pre-delivery
  • Extended Leave: Often extended to 128–158 days depending on province
  • Compensation: Paid by social insurance at a percentage of average earnings (local standards apply)
Paternity leave
  • Generally 7–30 days depending on province
  • Paid by employer, not covered by social insurance

Note:

  • Some cities (e.g., Beijing, Shanghai) offer additional parental leave for both parents
  • Policies are evolving, especially post-Three Child Policy reform
Annual Leave
  • Employees with 1–10 years of cumulative work experience: 5 days
  • 10–20 years: 10 days
  • Over 20 years: 15 days
  • Unused annual leave must be compensated financially if not used within a calendar year.
7 Public holidays in China

Note: Some holidays involve "make-up" working days before/after the break.

1st
New Year’s Day
1st
Spring Festival (Chinese New Year)
2nd
Spring Festival (Chinese New Year)
3rd
Spring Festival (Chinese New Year)
4th
Spring Festival (Chinese New Year)
5th
Spring Festival (Chinese New Year)
6th
Spring Festival (Chinese New Year)
7th
Spring Festival (Chinese New Year)
5th
Qingming Festival (Tomb Sweeping Day)
1st
Labor Day
1st
Dragon Boat Festival
2nd
Dragon Boat Festival
3rd
Dragon Boat Festival
28th
Mid-Autumn Festival
29th
Mid-Autumn Festival
30th
Mid-Autumn Festival
1st
National Day
2nd
National Day
3rd
National Day
4th
National Day
5th
National Day
6th
National Day
7th
National Day
  • 1 Jan: New Year Holiday
  • 1 Feb to 7 Feb: Spring Festival
  • 5 Apr: Ching Ming Festival
  • 1 May: Labor Day Holiday
  • 3 Jun: Dragon Boat Festival
  • 10 Sep: Mid-Autumn Festival
  • 1 Oct to 7 Oct: National Day Holiday

NB – these are estimated dates for national holidays and are yet to be confirmed. In addition to these dates, some regional holidays are also observed.

Termination Process

Termination

  • Termination must comply with China’s Labor Contract Law, which includes limited grounds for unilateral dismissal.
  • Permissible reasons include poor performance, mutual agreement, redundancy, or gross misconduct.

Notice Period

  • Standard: 30 days' written notice or one month’s salary in lieu
  • Probation period terminations may require only 3 days' notice
  • Unlawful termination may result in double compensation or reinstatement

Severance Pay

  • One month’s salary for each year of service
  • Employment of more than 6 months but less than a year counts as one full year
  • Capped at 3x the local average salary in some regions

Probation Period

  • Duration depends on contract length:
    • less then 1 year contract: 1 month
    • 1–3 year contract: up to 2 months
    • 3 years or open-ended contract: up to 6 months

Personal Details

Name, contact information, and role of the employee.

_'s Booming Remote Workforce

Challenges of Remote Hiring in _

Simplifying Remote Hiring in _ with RemotePass 

Grow Your Team in China
with RemotePass

From onboarding and payroll to offboarding and visa support, RemotePass simplifies it all so you can focus on growing your team.

Building and expanding a global workforce is seamless with RemotePass. Our platform simplifies the complexities of hiring, payroll, and compliance across over 150 countries, including China.

With RemotePass, you can quickly onboard international employees, manage payroll, ensure legal compliance, and provide competitive benefits—all from one place. Focus on growing your business while we handle the HR and legal intricacies.

Free 7-day trial

No credit card required

Cancel anytime

Hiring in China | Payroll, Tax & Employment Guide

China gives you access to one of the world’s largest and most capable talent markets, backed by strong infrastructure and a mature tech ecosystem. This guide gives you the clarity you need to hire confidently and stay compliant.

RemotePass makes hiring in China simple. We handle compliance, contracts, and payroll. You focus on growing your business.

Key Takeaways for Hiring in China

  • Payroll is highly regulated, with mandatory social insurance and housing fund contributions that vary significantly by city.
  •  Bonuses aren’t required, but Lunar New Year bonus practices (13th month) are widespread.
  • Statutory leave scales with cumulative work experience, not just time with the current employer.
  •  Expats face additional compliance steps, including work permit cancellation and residency deregistration during offboarding.

Quick Facts For Hiring In China

Continent
East Asia
Capital
Beijing
Currency
Renminbi (Chinese Yuan, CNY, RMB, ¥)
Language
Standard Mandarin (Chinese)
Payroll Cycle
Monthly
Pay Date
Last working day of the month

China Employment Contract Overview

Hiring in China begins with a precise, legally compliant contract. We outline the key terms we include to meet local requirements and protect both parties.

Contract Type
Fixed-term /Open-ended
Local Language Required?
Yes
Bilingual?
Yes
Probation Period
Under Chinese law, the maximum probation period depends on the contract length:
Less than three months: none allowed
Three months up to less than one year: one month
One year up to less than three years: two months
Three years or more, or open-ended contract: six months
Minimum Paid Time Off
Statutory annual leave is based on cumulative working experience:
One to less than 10 years: five days
Ten to less than 20 years: ten days
20 years or more: fifteen days
Public Holidays
11 public holidays
Notice Period
During probation: three days
After probation: 30 days

What Do You Need To Include In A Chinese Employment Contract?

To stay compliant in China, employers must include certain mandatory terms in the employment contract. These are the essentials we always include.

Employee Information

  • Full name
  • ID number
  • Role / Job title
  • Start date
  • Contract duration
  • Working hours
  • Probation and notice conditions
  • Termination provisions
  • Compensation details
  • Address details
  • Leave entitlement
  • End date (if applicable)

How Does Payroll and Taxation Work in China

With regional wage differences, mandatory social funds, and detailed monthly tax requirements, China’s payroll system can seem complex. Here’s a clear, expert overview of how payroll and taxation operate for employers.

Payroll Setup

Salary currency

Renminbi (Chinese Yuan, CNY, RMB, ¥)

Minimum Wage

China does not set a unified national minimum wage. Regional governments determine their own rates. In Shanghai, for example, the minimum wage is approximately RMB 2,690 per month which is currently the highest in the country..

Hours per Week

40 hours per week / Eight hours per day

Payroll Frequency

Monthly

Weekdays

Monday through Friday

Mandatory Bonuses

While there are no legally mandated bonuses, Lunar New Year bonus (often referred to as a “13th-month” salary) is a widespread custom.

Gross Salary Structure

Gross salary doesn’t follow a standardized structure in China.

What Payroll Taxes Do Employers Pay in China?

Employer cost % (estimate):


Employer Cost %

Contributions Breakdown

Pension Insurance:

14% -16% of the contribution base (some regions up to 20%)

Medical Insurance:

3% - 10% of the contribution base

Unemployment Insurance:

5.50% (indefinite contracts)

Unemployment Insurance:

0.5% -0.8%

Work Injury Insurance:

0.16% - 1.3%, depending on industry risk

Maternity Insurance:

0.5% - 3% (often combined with medical insurance)

Housing Fund:

5% - 12%, matching the employee’s rate

Disable Fee:

1.6%

Major Disease:

Fixed at CNY 70 per month

Employer Liability Insurance:

0.5% of total monthly income

What Payroll Taxes Do Employees Pay in China?

Individual Income Tax

Tax rates are progressive in China. Monthly taxable income is calculated as gross salary minus:

  • Standard deduction of RMB 5,000 per month (RMB 60,000/year)

  • Mandatory employee social insurance contributions

  • Other allowable deductions (e.g., housing, education, medical expenses)

Social Contributions


Total contribution approximately :

10- 22%

Social Insurance and Housing Fund

State (National) Rates:

  • Pension Insurance: 8% of salary

  • Medical Insurance: 2%

  • Unemployment Insurance: 0.2% - 0.5%

  • Housing Fund: 5–12%, depending on city

  • Maternity Insurance: 0.5%

Hiring cost calculator 

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CN
*
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Oops! Something went wrong while submitting the form.
Thank you! Your submission has been received!
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Employer cost
Total monthly cost of employment
Gross monthly salary costs
Estimated taxes and contributions
Employee cost
Net monthly salary
GBP 5,137
Gross monthly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Employer cost
Total yearly cost of employment
Gross yearly salary costs
Estimated taxes and contributions
Employee cost
Net yearly salary
GBP 5,137
Gross yearly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Request a detailed quotation

Hiring Cost Calculator

Employment of expats is supported in the cities of Shanghai and Shenzhen in China.

Benefits Provider Funded Through Notes
Health Insurance Government

Payroll Contributions

All employees, including expats (unless exempted by bilateral agreements), must participate in the public medical insurance scheme.

Employer and employee contributions cover basic healthcare, hospitalization, and some outpatient services.

Additional private health insurance is optional and often provided by employers for enhanced coverage.

Pension/Social Security Government

Payroll Contributions

Included in the social insurance “Five Insurances” and provides retirement pensions, disability, and survivor benefits.

Expatriates may be exempt if covered by social security in their home country under a bilateral agreement, but often are enrolled to ensure benefits portability.

Other Statutory Bonuses Government

Payroll Contributions

Unemployment Insurance: Mandatory; contributions from both employer and employee.

Work Injury Insurance: Mandatory; employer contribution only; rate varies by industry risk.

Maternity Insurance: Mandatory; generally employer-paid or merged with medical insurance.

Housing Fund: Mandatory in most cities; both employer and employee contribute. Some cities allow opt-out for expats.

Leave And Holiday Entitlement In China

Annual leave

Employees are entitled to statutory annual leave after one year of cumulative service (with current or previous employers):

  • One to 10 years of service: Five days

  • 10 to 20 years of service: 10 days

  • 20+ years of service: 15 days

Employers must schedule leave by balancing business needs and employee preferences.

If annual leave is not granted, employers must compensate at 300% of the regular daily wage for each unused day.

Public holidays

China has 11 national statutory holidays, including:

  • New Year’s Day

  • Spring Festival (Chinese New Year)

  • Qingming Festival

  • Labor Day

  • Dragon Boat Festival

  • Mid-Autumn Festival

  • And National Day (often with extended breaks)

Sick Leave

Sick leave duration is based on cumulative years of work:

  • Less than five years: Three months

  • Five to 10 years: Six to nine months

  • 10 - 15 years: 12 - 18 months

  • 15 - 20 years: 18 months

  • 20+ years: 24 months

Compensation ranges from 60% to 100% of normal wages depending on seniority.

Maternity Leave

Minimum national entitlement is 98 days:

  • 15 days pre-birth

  • Remainder post-birth

Regional extensions apply (30 - 90+ days), with total leave in some provinces reaching 158 - 180 days, and up to a year in Tibet.

Maternity pay is covered by the social security fund based on average salary.

If the fund does not cover the full amount, the employer must top it up.

Pregnant employees are protected from termination during pregnancy, maternity leave, and breastfeeding (up to one year).

Paternity Leave

No national standard; policies vary by province.

Typical durations include:

  • 10 - 15 days in major cities (Beijing, Shenzhen)

  • 20 - 30 days in provinces like Sichuan, Yunnan, Henan, Gansu

Paternity leave is generally paid at regular wage, depending on local rules.

Other Types of Leave

  • Childcare / Parental Leave: Regional rules vary.

    • Beijing & Shanghai: Five days/year for children under three

    • Many provinces: 10 days/year

    • Some regions offer extra leave for multiple children or until children reach age six

  • Bereavement Leave: Typically three days for immediate family; regional variations apply

  • Marriage Leave: Three to 10 days depending on region and contract

  • Compensatory (Make-Up) Days: Common practice during holiday periods. Weekends may be adjusted to create extended breaks

Termination and Offboarding in China

Wrapping up employment in China involves structured procedures and precise documentation. Below is everything you need to ensure a smooth and compliant offboarding process.

Type Possible?
Termination for Cause (poor performance, misconduct, etc.) Yes
Termination without Cause Yes
Mutual Termination Agreement (MTA) Yes
Redundancy Not possible under the EOR setup

Employee Resignations

Employee
Resignations

 Termination with Cause

Termination
with Cause

Termination without Cause

Termination
without Cause

Mutual Termination Agreement

Mutual Termination
Agreement

 Fixed Term Contract

Fixed Term
Contract

China Employee Resignation

Notice

Form

Written notice.

Notice period

  • After probation: 30 days advance written notice

  • During probation: Three days advance written notice

  • Termination without notice: An employee may end the employment contract immediately without prior notice if the employer:

    • Does not provide the working conditions outlined in the contract;

    • Fails to pay the employee fully and on time;

    • Neglects to pay mandatory social insurance contributions;

    • Implements rules that breach labor laws and adversely impact the employee;

    • Uses coercion or deception when forming or altering the contract;

    • Forces work through violence, threats, or unlawful restrictions on personal freedom; or

    • Requires the employee to carry out dangerous tasks that jeopardize their safety.

Payment in lieu of notice or notice waiver

If both parties agree, the notice period can be waived or shortened; otherwise the statutory minimum applies.

End-of-Service Benefits

Severance/Gratuity

In general, voluntary resignations do not trigger severance unless the resignation is due to employer breach of contract or law.

Other Benefits

  • Payment for all wages due up to the resignation date

  • Payment for any accrued unused annual leave

  • Any bonuses or allowances that have become due under contract or law

Termination Documentation

  • Written acknowledgement by employer of the resignation and its effective date

  • Certificate of service / separation document specifying start date, end date, position, and relevant entitlements

Employer Termination With Cause in China

Acceptable grounds

  • Serious violations of company rules or discipline

  • Criminal conduct or conviction

  • Gross negligence causing significant loss to the employer

  • Refusal or inability to perform work duties

  • Other legally defined serious misconduct

Notice

Form

Written notice specifying grounds for termination.

Notice period

Generally, immediate termination is allowed for cause without advance notice; however, employers must notify labor authorities in certain cases.

Payment in lieu of notice or notice waiver

No payment in lieu is required for termination with cause as employment ends immediately.

End-of-Service Benefits

Severance

No severance or gratuity is payable if termination is for a valid cause.

Other Benefits

  • Payment of all wages and benefits earned up to termination date

  • Payment for any accrued unused annual leave

Termination Documentation

  • Written termination letter stating cause and effective termination date.

  • The Employer must provide a termination certificate or proof of separation upon employee request.

  • Documentation must be retained in compliance with labor regulations.

Employer Termination Without Cause in China

Acceptable Grounds

  • Significant changes in objective circumstances rendering the contract unperformable, and no agreement on modification

  • Employee becomes incompetent and remains so after training or reassignment

  • Economic redundancies due to restructuring, bankruptcy, or business downturn (not possible under the EOR setup)

  • Other statutory grounds where termination is allowed without employee fault

Notice

Form

Written notice delivered to the employee.

Notice period

At least 30 days in advance or one month’s salary in lieu of notice.

Payment in lieu of notice or notice waiver

If no 30-day notice is given, the employer must pay one month of salary instead; waiver of notice requires employee consent.

End-of-Service Benefits

Severance

  • Severance is mandatory and calculated based on one month’s salary per full year of service.

  • Periods of service less than six months are compensated at half a month’s salary; six months or more count as a full year.

  • Severance is based on the average monthly wage of the 12 months prior to termination.

Other Benefits

  • All unpaid wages up to the termination date

  • Compensation for any unused annual leave

  • Statutory social insurance contributions and other entitlements accrued during employment

Termination Documentation

  • Written termination notice stating the reason and date of termination.

  • Certificate of termination or separation indicating the employee’s position, duration of employment, and reason for termination.

  • All documentation must be provided promptly to enable the employee to transfer social insurance and apply for unemployment benefits.

Mutual Termination Agreements in China

Notice

Form

A written agreement signed by both the employer and the employee confirming mutual consent to terminate the employment contract.

Notice period

No statutory notice period applies; the termination date is determined by mutual agreement.

Waiver of notice

Not applicable, as notice is not legally required when both parties agree to terminate.

End-of-Service Benefits

Severance

  • Severance is not automatically required in mutual termination.

  • If the employer offers severance as part of the agreement and the employee accepts, it becomes binding.

  • If the mutual termination is initiated by the employer and the employee agrees under economic pressure or without fault, severance is commonly paid in practice.

Other Benefits

  • All wages earned up to the agreed termination date must be paid.

  • Compensation for unused statutory annual leave

  • Any contractually agreed benefits that have accrued prior to termination

Termination Documentation

  • A written termination agreement signed by both parties specifying the termination date and any compensation or conditions

  • Certificate of termination (also called proof of separation) indicating employment period, position, and reason for separation

  • Documentation to facilitate social insurance transfer and legal compliance

Offboarding Process for the End of Fixed-term Contracts in China

If the Fixed-Term Contract Ends Normally

Notice

  • No advance notice is required from the employer or employee if the contract ends upon expiration and is not renewed.
  • The employer must inform the employee in advance if the contract is not going to be renewed, especially if it was previously renewed once and the employee has worked continuously for 10 years or more.

End-of-Service Benefits

Severance/Gratuity

  • Severance is required if the employer chooses not to renew the contract upon expiration, unless the employee declines a renewal on equal or better terms.
  • Severance is calculated as one month’s salary per full year of service.

Other Benefits

  • Wages up to the contract expiration date
  • Payment for unused statutory annual leave
  • Any bonuses, allowances, or benefits accrued under the contract

If the Employer Terminates Early

Notice

  • The employer must give at least 30 days’ written notice or pay one month’s salary in lieu of notice.
  • Termination must be for a lawful reason (such as incompetence, or legal grounds), or it will be deemed unlawful.

End-of-Service Benefits

Severance/Gratuity

  • Severance is mandatory if early termination is lawful.
  • The standard formula is one month’s average salary per full year of service.
  • Partial years of service over six months are counted as a full year; less than six months result in half-month severance.

Other Benefits

  • Payment of all earned wages up to the termination date
  • Compensation for any unused annual leave
  • Any other contractually agreed payments or entitlements

Final Payment Timing & Immigration and Visa Compliance in China

Final Payment Deadline

The employer must pay all final wages and economic compensation on or before the termination date or within a reasonable timeframe, usually the normal payroll cycle unless local authorities or collective agreements state otherwise.

Penalty

If the employer delays final wages or severance without a valid reason, the employee can file a complaint with the labor bureau. Authorities may then order the employer to pay double compensation for the delayed amounts. Late wage payments can also lead to administrative fines and, in serious cases, criminal liability.

Visa and Immigration Compliance

  • If the employee is a foreign national, the employer must cancel the work permit and residence permit after termination. This cancellation is handled through the relevant Exit-Entry Administration and the Ministry of Human Resources and Social Security.
  • The employer should complete final wage payments and issue all termination documents before starting the cancellation process. They must also provide a termination certificate, which the employee may need for visa conversion or departure procedures.
  • If the employer doesn’t follow these steps correctly, they may face compliance issues or future restrictions on hiring foreign employees.

Key Elements of an Employment Contract in China
When drafting an employment contract for employees in China, the following key elements should be included:

Personal Details

Name, contact information, and role of the employee.

_'s Booming Remote Workforce

Challenges of Remote Hiring in _

Simplifying Remote Hiring in _ with RemotePass 

Onboard Talent in China With RemotePass

From onboarding and payroll to offboarding and visa support, RemotePass simplifies it all so you can focus on growing your team.

Building and expanding a global workforce is seamless with RemotePass. Our platform simplifies the complexities of hiring, payroll, and compliance across over 150 countries, including China.

With RemotePass, you can quickly onboard international employees, manage payroll, ensure legal compliance, and provide competitive benefits—all from one place. Focus on growing your business while we handle the HR and legal intricacies.

FAQs About Hiring in China

Got Questions? Find Answers Here

Do I have to pay a 13th-month bonus?

No, it's not legally required. But it's such a widespread custom (especially around Lunar New Year) that employees expect it. Skipping it will hurt retention and make you uncompetitive.

Annual leave is based on total work experience, not time with my company?

Correct. An employee with 12 years of total career experience gets 10 days of annual leave from day one with you, even if they just started. It's cumulative across all employers, not just tenure at your company.

Why do social insurance costs vary so much by city?

Each city sets its own contribution rates and caps. Shanghai has different rates than Beijing or Shenzhen. Total employer costs can range from 27% to 45% of salary depending on location.

Can I fire someone for poor performance?

Not easily. You need to document incompetence, provide training or reassignment opportunities, and give 30 days' notice (or pay in lieu). Termination with cause (serious misconduct) is possible, but the bar is high.

What happens if I don't grant annual leave?

You must compensate at 300% of regular daily wage for each unused day. You can't just let it expire.

Do expats need to participate in social insurance?

Yes, unless they're exempt under a bilateral social security agreement with their home country. Most expats must be enrolled to ensure benefits portability.

What's required when a foreign employee leaves?

You must cancel their work permit and residence permit through the Exit-Entry Administration and Ministry of Human Resources. Provide all termination documents first. Missing this step can restrict your ability to hire foreign employees in future.

Let’s Chat

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China

China, officially the People's Republic of China, is the most populous country in the world and the second-largest economy by nominal GDP. Located in East Asia, it has a diverse industrial base, a highly structured legal framework, and rapidly evolving employment laws. As a key global manufacturing and technology hub, China presents significant opportunities for businesses looking to hire and expand. However, navigating its employment landscape requires careful attention to local regulations, which often vary by province and municipality.
Contractor Management
EOR
Payroll
Contractor of Record
العملة
Chinese yuan (CNY)
تردد الرواتب
Monthly
ضرائب أصحاب العمل
39.56 to 40.922% (Beijing)

نظرة عامة

التركيبة السكانية
1.4 billion
اللغة
Mandarin Chinese (Putonghua)
العاصمة
Beijing
العملة
Chinese yuan (CNY)
رمز الاتصال الدولي
+86
الحد الأدنى للأجور
Varies by province and city (e.g., ¥2,320/month in Shanghai; ¥1,920/month in Beijing)
ساعات العمل
8 hours per day
أيام الأسبوع
Monday to Friday
ساعات العمل اسبوعيا
40 hours per week

الرواتب

الموظفون برواتب ثابتة
Monthly, with salaries typically paid by the end of each month
الموظفون بنظام الأجر الزمني
13th Salary
متوسط ​​ضريبة صاحب العمل

~30%–40% of gross salary

تحصيل الضرائب

Employer Social Insurance Contributions: Varies by city, but commonly includes:

Pension Insurance
~16%
Medical Insurance
~10%
Unemployment Insurance
~0.5%–1%
Work-related Injury Insurance
~0.2%–1.9% (industry-based)
Maternity Insurance
~0.8%
Housing Fund
5%–12% (varies by city)

ضريبة القيمة المضافة

ضريبة القيمة المضافة

13% for goods, 6%–9% for services (VAT policies may vary by sector and location).

حساب الضريبة في China
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تكلفة صاحب العمل
إجمالي تكلفة التوظيف الشهرية
إجمالي تكاليف الراتب الشهري
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب الشهري

GBP 5,137
الراتب الشهري الإجمالي
GBP 8,334
الضرائب المقدرة والضمان الاجتماعي
GBP 8,334
تكلفة صاحب العمل
إجمالي تكلفة التوظيف السنوية
إجمالي تكاليف الرواتب السنوية
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب السنوي

GBP 5,137
الراتب السنوي الإجمالي
GBP 8,334
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عملية الانضمام

تشمل عملية التوظيف في China عادة الخطوات التالية لضمان انتقال سلس للموظفين الجدد:

Employment Contract

  • Must be written and signed within one month of employment start
  • Must include job title, compensation, working hours, location, social insurance, and termination conditions

Social Insurance Registration

Employers must enroll new employees in social security and housing fund schemes within 30 days

Tax Setup

Employers must register employees with local tax authorities for withholding purposes

Work Permits for Foreign Hires

  • Must obtain a Z-visa and work permit before onboarding
  • Residence permit required within 30 days of arrival

Employee Orientation

  • Introduce company culture, code of conduct, internal policies, and reporting lines
  • Provide training for health and safety, data protection, and job-specific tools

Probation Period Review

Employers should conduct a performance review before probation ends and decide on confirmation, extension, or dismissal

Pre-boarding

Pre-boarding

Pre-boarding

العناصر الأساسية في عقد العمل في China
عند إعداد عقد عمل للموظفين في China يجب تضمين العناصر الأساسية التالية:

Personal Details

Name, contact information, and role of the employee.

سياسات إجازات الموظفين

الإجازات المرضية
  • Sick leave duration and pay vary by tenure and local policy.
  • Employees are usually paid 60%–100% of salary (or based on local average) during sick leave.
  • Medical certificates are mandatory.


إجازة الأمومة
  • Standard Duration: 98 days, including 15 days pre-delivery
  • Extended Leave: Often extended to 128–158 days depending on province
  • Compensation: Paid by social insurance at a percentage of average earnings (local standards apply)
إجازة الأبوة
  • Generally 7–30 days depending on province
  • Paid by employer, not covered by social insurance

Note:

  • Some cities (e.g., Beijing, Shanghai) offer additional parental leave for both parents
  • Policies are evolving, especially post-Three Child Policy reform
الإجازة السنوية
  • Employees with 1–10 years of cumulative work experience: 5 days
  • 10–20 years: 10 days
  • Over 20 years: 15 days
  • Unused annual leave must be compensated financially if not used within a calendar year.
7 عطلات رسمية في China

Note: Some holidays involve "make-up" working days before/after the break.

1st
New Year’s Day
1st
Spring Festival (Chinese New Year)
2nd
Spring Festival (Chinese New Year)
3rd
Spring Festival (Chinese New Year)
4th
Spring Festival (Chinese New Year)
5th
Spring Festival (Chinese New Year)
6th
Spring Festival (Chinese New Year)
7th
Spring Festival (Chinese New Year)
5th
Qingming Festival (Tomb Sweeping Day)
1st
Labor Day
1st
Dragon Boat Festival
2nd
Dragon Boat Festival
3rd
Dragon Boat Festival
28th
Mid-Autumn Festival
29th
Mid-Autumn Festival
30th
Mid-Autumn Festival
1st
National Day
2nd
National Day
3rd
National Day
4th
National Day
5th
National Day
6th
National Day
7th
National Day
  • 1 Jan: New Year Holiday
  • 1 Feb to 7 Feb: Spring Festival
  • 5 Apr: Ching Ming Festival
  • 1 May: Labor Day Holiday
  • 3 Jun: Dragon Boat Festival
  • 10 Sep: Mid-Autumn Festival
  • 1 Oct to 7 Oct: National Day Holiday

NB – these are estimated dates for national holidays and are yet to be confirmed. In addition to these dates, some regional holidays are also observed.

عملية إنهاء العقود

Termination

  • Termination must comply with China’s Labor Contract Law, which includes limited grounds for unilateral dismissal.
  • Permissible reasons include poor performance, mutual agreement, redundancy, or gross misconduct.

Notice Period

  • Standard: 30 days' written notice or one month’s salary in lieu
  • Probation period terminations may require only 3 days' notice
  • Unlawful termination may result in double compensation or reinstatement

Severance Pay

  • One month’s salary for each year of service
  • Employment of more than 6 months but less than a year counts as one full year
  • Capped at 3x the local average salary in some regions

Probation Period

  • Duration depends on contract length:
    • less then 1 year contract: 1 month
    • 1–3 year contract: up to 2 months
    • 3 years or open-ended contract: up to 6 months

Personal Details

Name, contact information, and role of the employee.

نمو سوق العمل عن بُعد _  

تحديات التوظيف عن بُعد في  _

تبسيط التوظيف عن بُعد في _ مع ريموت باس

نمِّ فريقك في China
مع ريموت باس

From onboarding and payroll to offboarding and visa support, RemotePass simplifies it all so you can focus on growing your team.

يصبح بناء فريق عالمي وتوسيعه مهمة سهلة مع ريموت باس. منصتنا تبسّط تعقيدات التوظيف والرواتب والامتثال القانوني في أكثر من 150 دولة، بما في ذلك China.

مع ريموت باس، يمكنك ضم الموظفين الدوليين بسرعة، وإدارة الرواتب، وضمان الامتثال القانوني، وتقديم مزايا تنافسية — كل ذلك من مكان واحد. ركّز على تنمية أعمالك، ودع المهام الإدارية والقانونية علينا.

تجربة مجانية لمدة 7 أيام

لا حاجة لبطاقة ائتمان

يمكنك الإلغاء في أي وقت

Hiring in China | Payroll, Tax & Employment Guide

China gives you access to one of the world’s largest and most capable talent markets, backed by strong infrastructure and a mature tech ecosystem. This guide gives you the clarity you need to hire confidently and stay compliant.

RemotePass makes hiring in China simple. We handle compliance, contracts, and payroll. You focus on growing your business.

Key Takeaways for Hiring in China

  • Payroll is highly regulated, with mandatory social insurance and housing fund contributions that vary significantly by city.
  •  Bonuses aren’t required, but Lunar New Year bonus practices (13th month) are widespread.
  • Statutory leave scales with cumulative work experience, not just time with the current employer.
  •  Expats face additional compliance steps, including work permit cancellation and residency deregistration during offboarding.

Quick Facts For Hiring In China

Continent
East Asia
Capital
Beijing
Currency
Renminbi (Chinese Yuan, CNY, RMB, ¥)
Language
Standard Mandarin (Chinese)
Payroll Cycle
Monthly
Pay Date
Last working day of the month

China Employment Contract Overview

Hiring in China begins with a precise, legally compliant contract. We outline the key terms we include to meet local requirements and protect both parties.

Contract Type
Fixed-term /Open-ended
Local Language Required?
Yes
Bilingual?
Yes
Probation Period
Under Chinese law, the maximum probation period depends on the contract length:
Less than three months: none allowed
Three months up to less than one year: one month
One year up to less than three years: two months
Three years or more, or open-ended contract: six months
Minimum Paid Time Off
Statutory annual leave is based on cumulative working experience:
One to less than 10 years: five days
Ten to less than 20 years: ten days
20 years or more: fifteen days
Public Holidays
11 public holidays
Notice Period
During probation: three days
After probation: 30 days

What Do You Need To Include In A Chinese Employment Contract?

To stay compliant in China, employers must include certain mandatory terms in the employment contract. These are the essentials we always include.

Employee Information

  • Full name
  • ID number
  • Role / Job title
  • Start date
  • Contract duration
  • Working hours
  • Probation and notice conditions
  • Termination provisions
  • Compensation details
  • Address details
  • Leave entitlement
  • End date (if applicable)

How Does Payroll and Taxation Work in China

With regional wage differences, mandatory social funds, and detailed monthly tax requirements, China’s payroll system can seem complex. Here’s a clear, expert overview of how payroll and taxation operate for employers.

Payroll Setup

Salary currency

Renminbi (Chinese Yuan, CNY, RMB, ¥)

Minimum Wage

China does not set a unified national minimum wage. Regional governments determine their own rates. In Shanghai, for example, the minimum wage is approximately RMB 2,690 per month which is currently the highest in the country..

Hours per Week

40 hours per week / Eight hours per day

Payroll Frequency

Monthly

Weekdays

Monday through Friday

Mandatory Bonuses

While there are no legally mandated bonuses, Lunar New Year bonus (often referred to as a “13th-month” salary) is a widespread custom.

Gross Salary Structure

Gross salary doesn’t follow a standardized structure in China.

What Payroll Taxes Do Employers Pay in China?

Employer cost % (estimate):


Employer Cost %

Contributions Breakdown

Pension Insurance:

14% -16% of the contribution base (some regions up to 20%)

Medical Insurance:

3% - 10% of the contribution base

Unemployment Insurance:

5.50% (indefinite contracts)

Unemployment Insurance:

0.5% -0.8%

Work Injury Insurance:

0.16% - 1.3%, depending on industry risk

Maternity Insurance:

0.5% - 3% (often combined with medical insurance)

Housing Fund:

5% - 12%, matching the employee’s rate

Disable Fee:

1.6%

Major Disease:

Fixed at CNY 70 per month

Employer Liability Insurance:

0.5% of total monthly income

What Payroll Taxes Do Employees Pay in China?

Individual Income Tax

Tax rates are progressive in China. Monthly taxable income is calculated as gross salary minus:

  • Standard deduction of RMB 5,000 per month (RMB 60,000/year)

  • Mandatory employee social insurance contributions

  • Other allowable deductions (e.g., housing, education, medical expenses)

Social Contributions


Total contribution approximately :

10- 22%

Social Insurance and Housing Fund

State (National) Rates:

  • Pension Insurance: 8% of salary

  • Medical Insurance: 2%

  • Unemployment Insurance: 0.2% - 0.5%

  • Housing Fund: 5–12%, depending on city

  • Maternity Insurance: 0.5%

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تكلفة صاحب العمل
إجمالي تكلفة التوظيف الشهرية
إجمالي تكاليف الراتب الشهري
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب الشهري

GBP 5,137
الراتب الشهري الإجمالي
GBP 8,334
الضرائب المقدرة والضمان الاجتماعي
GBP 8,334
تكلفة صاحب العمل
إجمالي تكلفة التوظيف السنوية
إجمالي تكاليف الرواتب السنوية
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب السنوي

GBP 5,137
الراتب السنوي الإجمالي
GBP 8,334
الضرائب المقدرة والضمان الاجتماعي
GBP 8,334
اطلب عرض أسعار تفصيلي

Hiring Cost Calculator

Employment of expats is supported in the cities of Shanghai and Shenzhen in China.

Benefits Provider Funded Through Notes
Health Insurance Government

Payroll Contributions

All employees, including expats (unless exempted by bilateral agreements), must participate in the public medical insurance scheme.

Employer and employee contributions cover basic healthcare, hospitalization, and some outpatient services.

Additional private health insurance is optional and often provided by employers for enhanced coverage.

Pension/Social Security Government

Payroll Contributions

Included in the social insurance “Five Insurances” and provides retirement pensions, disability, and survivor benefits.

Expatriates may be exempt if covered by social security in their home country under a bilateral agreement, but often are enrolled to ensure benefits portability.

Other Statutory Bonuses Government

Payroll Contributions

Unemployment Insurance: Mandatory; contributions from both employer and employee.

Work Injury Insurance: Mandatory; employer contribution only; rate varies by industry risk.

Maternity Insurance: Mandatory; generally employer-paid or merged with medical insurance.

Housing Fund: Mandatory in most cities; both employer and employee contribute. Some cities allow opt-out for expats.

Leave And Holiday Entitlement In China

Annual leave

Employees are entitled to statutory annual leave after one year of cumulative service (with current or previous employers):

  • One to 10 years of service: Five days

  • 10 to 20 years of service: 10 days

  • 20+ years of service: 15 days

Employers must schedule leave by balancing business needs and employee preferences.

If annual leave is not granted, employers must compensate at 300% of the regular daily wage for each unused day.

Public holidays

China has 11 national statutory holidays, including:

  • New Year’s Day

  • Spring Festival (Chinese New Year)

  • Qingming Festival

  • Labor Day

  • Dragon Boat Festival

  • Mid-Autumn Festival

  • And National Day (often with extended breaks)

Sick Leave

Sick leave duration is based on cumulative years of work:

  • Less than five years: Three months

  • Five to 10 years: Six to nine months

  • 10 - 15 years: 12 - 18 months

  • 15 - 20 years: 18 months

  • 20+ years: 24 months

Compensation ranges from 60% to 100% of normal wages depending on seniority.

Maternity Leave

Minimum national entitlement is 98 days:

  • 15 days pre-birth

  • Remainder post-birth

Regional extensions apply (30 - 90+ days), with total leave in some provinces reaching 158 - 180 days, and up to a year in Tibet.

Maternity pay is covered by the social security fund based on average salary.

If the fund does not cover the full amount, the employer must top it up.

Pregnant employees are protected from termination during pregnancy, maternity leave, and breastfeeding (up to one year).

Paternity Leave

No national standard; policies vary by province.

Typical durations include:

  • 10 - 15 days in major cities (Beijing, Shenzhen)

  • 20 - 30 days in provinces like Sichuan, Yunnan, Henan, Gansu

Paternity leave is generally paid at regular wage, depending on local rules.

Other Types of Leave

  • Childcare / Parental Leave: Regional rules vary.

    • Beijing & Shanghai: Five days/year for children under three

    • Many provinces: 10 days/year

    • Some regions offer extra leave for multiple children or until children reach age six

  • Bereavement Leave: Typically three days for immediate family; regional variations apply

  • Marriage Leave: Three to 10 days depending on region and contract

  • Compensatory (Make-Up) Days: Common practice during holiday periods. Weekends may be adjusted to create extended breaks

Termination and Offboarding in China

Wrapping up employment in China involves structured procedures and precise documentation. Below is everything you need to ensure a smooth and compliant offboarding process.

Type Possible?
Termination for Cause (poor performance, misconduct, etc.) Yes
Termination without Cause Yes
Mutual Termination Agreement (MTA) Yes
Redundancy Not possible under the EOR setup

Employee Resignations

Employee
Resignations

 Termination with Cause

Termination
with Cause

Termination without Cause

Termination
without Cause

Mutual Termination Agreement

Mutual Termination
Agreement

 Fixed Term Contract

Fixed Term
Contract

China Employee Resignation

Notice

Form

Written notice.

Notice period

  • After probation: 30 days advance written notice

  • During probation: Three days advance written notice

  • Termination without notice: An employee may end the employment contract immediately without prior notice if the employer:

    • Does not provide the working conditions outlined in the contract;

    • Fails to pay the employee fully and on time;

    • Neglects to pay mandatory social insurance contributions;

    • Implements rules that breach labor laws and adversely impact the employee;

    • Uses coercion or deception when forming or altering the contract;

    • Forces work through violence, threats, or unlawful restrictions on personal freedom; or

    • Requires the employee to carry out dangerous tasks that jeopardize their safety.

Payment in lieu of notice or notice waiver

If both parties agree, the notice period can be waived or shortened; otherwise the statutory minimum applies.

End-of-Service Benefits

Severance/Gratuity

In general, voluntary resignations do not trigger severance unless the resignation is due to employer breach of contract or law.

Other Benefits

  • Payment for all wages due up to the resignation date

  • Payment for any accrued unused annual leave

  • Any bonuses or allowances that have become due under contract or law

Termination Documentation

  • Written acknowledgement by employer of the resignation and its effective date

  • Certificate of service / separation document specifying start date, end date, position, and relevant entitlements

Employer Termination With Cause in China

Acceptable grounds

  • Serious violations of company rules or discipline

  • Criminal conduct or conviction

  • Gross negligence causing significant loss to the employer

  • Refusal or inability to perform work duties

  • Other legally defined serious misconduct

Notice

Form

Written notice specifying grounds for termination.

Notice period

Generally, immediate termination is allowed for cause without advance notice; however, employers must notify labor authorities in certain cases.

Payment in lieu of notice or notice waiver

No payment in lieu is required for termination with cause as employment ends immediately.

End-of-Service Benefits

Severance

No severance or gratuity is payable if termination is for a valid cause.

Other Benefits

  • Payment of all wages and benefits earned up to termination date

  • Payment for any accrued unused annual leave

Termination Documentation

  • Written termination letter stating cause and effective termination date.

  • The Employer must provide a termination certificate or proof of separation upon employee request.

  • Documentation must be retained in compliance with labor regulations.

Employer Termination Without Cause in China

Acceptable Grounds

  • Significant changes in objective circumstances rendering the contract unperformable, and no agreement on modification

  • Employee becomes incompetent and remains so after training or reassignment

  • Economic redundancies due to restructuring, bankruptcy, or business downturn (not possible under the EOR setup)

  • Other statutory grounds where termination is allowed without employee fault

Notice

Form

Written notice delivered to the employee.

Notice period

At least 30 days in advance or one month’s salary in lieu of notice.

Payment in lieu of notice or notice waiver

If no 30-day notice is given, the employer must pay one month of salary instead; waiver of notice requires employee consent.

End-of-Service Benefits

Severance

  • Severance is mandatory and calculated based on one month’s salary per full year of service.

  • Periods of service less than six months are compensated at half a month’s salary; six months or more count as a full year.

  • Severance is based on the average monthly wage of the 12 months prior to termination.

Other Benefits

  • All unpaid wages up to the termination date

  • Compensation for any unused annual leave

  • Statutory social insurance contributions and other entitlements accrued during employment

Termination Documentation

  • Written termination notice stating the reason and date of termination.

  • Certificate of termination or separation indicating the employee’s position, duration of employment, and reason for termination.

  • All documentation must be provided promptly to enable the employee to transfer social insurance and apply for unemployment benefits.

Mutual Termination Agreements in China

Notice

Form

A written agreement signed by both the employer and the employee confirming mutual consent to terminate the employment contract.

Notice period

No statutory notice period applies; the termination date is determined by mutual agreement.

Waiver of notice

Not applicable, as notice is not legally required when both parties agree to terminate.

End-of-Service Benefits

Severance

  • Severance is not automatically required in mutual termination.

  • If the employer offers severance as part of the agreement and the employee accepts, it becomes binding.

  • If the mutual termination is initiated by the employer and the employee agrees under economic pressure or without fault, severance is commonly paid in practice.

Other Benefits

  • All wages earned up to the agreed termination date must be paid.

  • Compensation for unused statutory annual leave

  • Any contractually agreed benefits that have accrued prior to termination

Termination Documentation

  • A written termination agreement signed by both parties specifying the termination date and any compensation or conditions

  • Certificate of termination (also called proof of separation) indicating employment period, position, and reason for separation

  • Documentation to facilitate social insurance transfer and legal compliance

Offboarding Process for the End of Fixed-term Contracts in China

If the Fixed-Term Contract Ends Normally

Notice

  • No advance notice is required from the employer or employee if the contract ends upon expiration and is not renewed.
  • The employer must inform the employee in advance if the contract is not going to be renewed, especially if it was previously renewed once and the employee has worked continuously for 10 years or more.

End-of-Service Benefits

Severance/Gratuity

  • Severance is required if the employer chooses not to renew the contract upon expiration, unless the employee declines a renewal on equal or better terms.
  • Severance is calculated as one month’s salary per full year of service.

Other Benefits

  • Wages up to the contract expiration date
  • Payment for unused statutory annual leave
  • Any bonuses, allowances, or benefits accrued under the contract

If the Employer Terminates Early

Notice

  • The employer must give at least 30 days’ written notice or pay one month’s salary in lieu of notice.
  • Termination must be for a lawful reason (such as incompetence, or legal grounds), or it will be deemed unlawful.

End-of-Service Benefits

Severance/Gratuity

  • Severance is mandatory if early termination is lawful.
  • The standard formula is one month’s average salary per full year of service.
  • Partial years of service over six months are counted as a full year; less than six months result in half-month severance.

Other Benefits

  • Payment of all earned wages up to the termination date
  • Compensation for any unused annual leave
  • Any other contractually agreed payments or entitlements

Final Payment Timing & Immigration and Visa Compliance in China

Final Payment Deadline

The employer must pay all final wages and economic compensation on or before the termination date or within a reasonable timeframe, usually the normal payroll cycle unless local authorities or collective agreements state otherwise.

Penalty

If the employer delays final wages or severance without a valid reason, the employee can file a complaint with the labor bureau. Authorities may then order the employer to pay double compensation for the delayed amounts. Late wage payments can also lead to administrative fines and, in serious cases, criminal liability.

Visa and Immigration Compliance

  • If the employee is a foreign national, the employer must cancel the work permit and residence permit after termination. This cancellation is handled through the relevant Exit-Entry Administration and the Ministry of Human Resources and Social Security.
  • The employer should complete final wage payments and issue all termination documents before starting the cancellation process. They must also provide a termination certificate, which the employee may need for visa conversion or departure procedures.
  • If the employer doesn’t follow these steps correctly, they may face compliance issues or future restrictions on hiring foreign employees.

Key Elements of an Employment Contract in China
When drafting an employment contract for employees in China, the following key elements should be included:

Personal Details

Name, contact information, and role of the employee.

_'s Booming Remote Workforce

Challenges of Remote Hiring in _

Simplifying Remote Hiring in _ with RemotePass 

Onboard Talent in China With RemotePass

From onboarding and payroll to offboarding and visa support, RemotePass simplifies it all so you can focus on growing your team.

Building and expanding a global workforce is seamless with RemotePass. Our platform simplifies the complexities of hiring, payroll, and compliance across over 150 countries, including China.

With RemotePass, you can quickly onboard international employees, manage payroll, ensure legal compliance, and provide competitive benefits—all from one place. Focus on growing your business while we handle the HR and legal intricacies.

FAQs About Hiring in China

Got Questions? Find Answers Here

Do I have to pay a 13th-month bonus?

No, it's not legally required. But it's such a widespread custom (especially around Lunar New Year) that employees expect it. Skipping it will hurt retention and make you uncompetitive.

Annual leave is based on total work experience, not time with my company?

Correct. An employee with 12 years of total career experience gets 10 days of annual leave from day one with you, even if they just started. It's cumulative across all employers, not just tenure at your company.

Why do social insurance costs vary so much by city?

Each city sets its own contribution rates and caps. Shanghai has different rates than Beijing or Shenzhen. Total employer costs can range from 27% to 45% of salary depending on location.

Can I fire someone for poor performance?

Not easily. You need to document incompetence, provide training or reassignment opportunities, and give 30 days' notice (or pay in lieu). Termination with cause (serious misconduct) is possible, but the bar is high.

What happens if I don't grant annual leave?

You must compensate at 300% of regular daily wage for each unused day. You can't just let it expire.

Do expats need to participate in social insurance?

Yes, unless they're exempt under a bilateral social security agreement with their home country. Most expats must be enrolled to ensure benefits portability.

What's required when a foreign employee leaves?

You must cancel their work permit and residence permit through the Exit-Entry Administration and Ministry of Human Resources. Provide all termination documents first. Missing this step can restrict your ability to hire foreign employees in future.

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