The Useful Aspects of HR Audit for the Foreign Firms in China

Overseas organizations that operate in China are facing a greater number of potential labor disputes. A steady and sharp rise in the labor dispute case makes it absolutely important to perform an HR audit. A human resources audit usually involves a review of all HR policies, practices, and procedures, whether or not they are formal. It includes reviewing documents, interviewing human resources professionals from different areas of the organization, interviewing some managers at different levels of the organization, and possibly interviewing in-house employment counsel.

A strategic HR audit is the highest level of audit for the HR department. It includes all the current strategies and policies of the HR. A review is done to see if the HR is putting the strategies of the organization into practice. If you are wondering which kind of foreign companies operating in China should go for the HR audit, the general advice for most of the Chinese business lawyers, following are the companies must go for the HR audit in China-

  • WFOEs
  • Rep Offices
  • Joint Ventures

In China, labor disputes can be really expensive, time-taking and inconvenient. An HR audit can offer you a sense in advance about the hidden HR-related problems and complications, as well as possible compliance issues against a backdrop of China’s ever-evolving rules and regulations. Doing business can be really difficult in this country as China’s employment laws and rules just keep getting more complicated, more pro-employee, and more localized. An audit could work as a defense mechanism against any probable difficulties you may face in future regarding labor-related problems.

Because regulations are always subject to change as a result of new legislation or interpretations, HR audits should be conducted periodically to ensure that organizations are in compliance with the latest federal and state requirements. According to the Chinese business lawyers, the main benefit of the HR audit is that it offers specific, measurable and verifiable data of the current state of the function and ensures timely compliance with legal requirements, company and mandated regulations, and professional standards.

There is no surprise that China employment lawyers put extreme emphasis on the employer audit as an important part of the due diligence on any M&A deal. All the foreign companies working in China should keep in mind that a comprehensive HR audit not only helps to point out the complexities hidden in the human resource department that can have a negative impact on your business but also helps your organization to achieve remarkable growth and development. Not surprisingly, Chinese business lawyers suggest their clients to keep in mind that the human resource audit in China is not limited to WFOEs. There are other aspects that need to be included for a seamless business experience in China.

Share with friends:

China Represents The Biggest Opportunities for the Foreign Brands

“Europe’s mired in mud. The U.S. economy’s flat. So where’s the action? It’s in China,” says Robert Collins, co-author of Doing Business in China for Dummies. Each of the potential Chinese business models accepted by the People’s Republic of China (PRC) has its distinct advantages. This signifies that even small obscure markets, or special niche products that would find the US and European market a tough battleground would find the Chinese market highly conducive.

China is the most successful communist country on the planet where thousands of foreign companies have written their success story by serving to a customer base over a billion people. This second largest economy of the world is accommodating, with more markets, industries and niches and there is no reason for you not to join these bandwagon. The Chinese (consumer) market is large and growing. According to the Chinese business lawyers, this means that entrepreneurs have possibilities to scale their business. During the last quarter-century, China has transposed to a more market-friendly economy that has a fast-growing private sector.

Reforms taken by Xi Jinping– After taking office, President Xi Jinping has vigorously pursued what he has called a “great rejuvenation of the Chinese nation” with his China Dream vision. Under him, China has enacted economic reform to combat slowing growth, such as cutting down bloated state-owned industries and reducing pollution, as well as its One Belt One Road trade project. Xi’s policies have changed the country in various ways, his anti-corruption campaigns, making this country more favorable for foreign investment by cutting the red tape and boosting China’s image as the finest place for doing business are the key factors for China’s stupendous growth.

Second-largest consumer market in the world- China’s overall economic growth is slowing, but the Chinese consumer economy is still massive in absolute terms and poised for increasing growth. China’s government is committed to transitioning the country’s economy from an investment-led to consumption-led. The country will see nearly $2 trillion in new consumption by 2021—about 27% of the total consumption growth that will occur in major economies during that time. It is a very particular advantage that the Chinese market has; because of China’s enormous manufacturing dominance, business has room to grow more than in many other countries. In the view of the most Chinese business lawyers, China thus represents one of the biggest opportunities for consumer companies in the world for the foreseeable future.

Skilled workforce- China’s growing skilled population is undoubtedly an asset for the country. High-skilled workers usually refer to those who grasp expertise or sophisticated skills in a certain area. China aims to expand its high-skilled workers to 39 million by 2020. As a foreign investor, you can be rest assured that there will be no shortage of qualified professionals in China and you don’t need to hire high-salaried professionals from other countries for your operations in this country.

Tremendous opportunity for small business– Chinese consumers are open to creating new relationships with worldwide brands. It’s a tremendous opportunity for a small business to get in early on the Chinese consumer’s brand affinity cycle and create strong relationships. With China’s rapid development and growth. Government rules, regulation, and laws have open new and easy ways for market entry for foreign companies. Today, China accounts for more than half of all global shopping center development, and it is considered to be one of the top market fo retail space constructions.

It has been suggested by the Chinese business lawyers, the rapid development of China’s economy has resulted in the tremendous increase in the average household income and more and more Chinese citizens are entering into the middle class category. In recent years, top fashion brands are enjoying greater success with the younger generation of wealthy Chinese. Undoubtedly, China has emerged as the best country in the planet for doing business.

Share with friends: