Thinking of Recruiting Employees in China? Explore the Basic Points

The most common problem foreign companies face is that the Chinese government does not allow the Chinese companies to send money to the foreign clients they owe. As the Chinese government made it really hard to get the money out of the country, it has become really problematic for the foreign companies to get the money they owe. The ideal solution is to get complete knowledge about the China deal and act according to the category of transaction.

As more and more companies are considering entering into the Chinese market, employment law becomes more relevant internationally. Companies, both domestic and international companies operating in China need to strictly maintain employment law. There are a set of rules that every employer in China has to abide by while considering the recruitment of local Chinese or foreign employees.

There are so many key provisions China lawyers suggest companies to keep in their employment contract, such as:

  • Go for a written employment contract
  • Make China-centric employment contract
  • Infuse employee rules and regulations manual
  • Lock in your ID
  • Keep the section of probationary period

Hiring employees from Hong Kong, Taiwan and Macau in the Chinese mainland requires meeting certain legal procedures and receiving proper government permission. The present Provisions are formulated according to the Labor Law of the People’s Republic of China and other relevant laws and administrative regulations.

Certificates required to be obtained for employing foreign employees

  1. Working Permit
  2. Employment License
  3. Residence Permit

Employment law of Beijing

The employment law of Beijing is based on federal and state constitutions, legislation, administrative rules, and court opinions. A particular employment relationship may also be governed by a contract. Foreign talent in Beijing will receive more social security, including better incentive mechanisms, mutual recognition of international professional qualifications and better social insurance standards.

The types of employment in China can be divided in full-time employment, part-time employment and dispatch employment. China’s labor laws use employment contracts as the basis for employment agreements. Under China employment law, which requires a written contract with penalties for employers who do not have one.

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. 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.

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Why Going for China Employment Contracts is the Right Strategy

China has the second largest economy and one of the strongest consumer markets globally. No wonder, big companies and entrepreneurs all across the world consider China as a potential location for startups and business expansion. However, foreign companies find that this is not a simple task, particularly due to the existing China employment law.

Employment law in China offers comprehensive and rigid rules. From hiring employees to termination, Chinese employment law covers everything and the notable thing is there is no room to improvise anything to the employment relationship.

Employment Contracts in China

China’s labor laws use employment contracts as the basis for employment agreements. A written employment contract is required in China. If the parties do not execute a written contract, then after one year, the employer and the employee are deemed to have established a non-fixed term (ie, permanent) employment relationship. Not only knowing the things foreign companies must keep in the employment contract, but there are several provisions they must skip in the China employment contract.

List of items you must include in the China employment contract

  • Breaks and vacations
  • Salary
  • Basic information for the employer and the employee
  • Work site and hours
  • Labor protection and safety
  • Job description
  • Term of the contract including probationary periods
  • Social insurance
  • Other items as required by law

Even a few years ago, Chinese employees were reluctant to pursue a long and hard legal battle for any employment disputes. They were happy to receive any sort of settlement as quickly as possible and move on to other employment as there were abundant job opportunities in the Chinese market. But things have changed a lot over the years. The slowdown in the Chinse economy, rise in the labor wages that results in foreign companies shifting their base to the cheaper locations and the negative effect of the global geopolitical events have a massive impact on the Chinese job market.

As finding good jobs becoming hard these days, fired Chinese employers are paying more attention to pursuing long-term legal actions against their employers. Because of this trend, having the right strategy before approaching an employee about termination is more important than ever.

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