Every country has its own employment rules, regulations and accepted norms – and China is no different. If you’re operating a business entity in China, we’ve assembled some important information that could be very helpful for recruiting in China and your employee management efforts.
Let’s Talk About HR Services In China
Overseas companies that establish local entities in China are tasked with the immediate mission of putting together a local team. Recruiting in China may sound easy, but it’s not – especially when carried out by a foreign executive who must fly to China especially for this purpose, and who is not versed in the local work culture. So, if you want to recruit the right people, and you want to do it fast, what are your options? Well, you’ll be happy to know that you can rely on an “Employer of Record” (EOR) to recruit and hire your employees for you – based on your exact needs and specifications.
The right EOR can provide all the HR services in China that you need. For example, it can conduct an expert candidate screening process – from CV overview to the final interview and hiring. What’s equally important is that the EOR can draft the labor agreements for all of your employees, and make sure that everything pertaining to your employees complies with China’s local regulations.
But that’s not all, of course. Unlike placement agencies, the EOR can actually employee your team members on your behalf and pay them accordingly. But some EORs – like PTL Group, for example – do even more. At PTL Group, provide holistic HR management services – we look after the employees’ welfare, make sure that they receive all of their social benefits, supervise their work and facilitate a seamless communication between them and your HQ.
To sum up, the China EOR is a great choice, especially if it can offer full employee life-cycle management. Partnering with an EOR like PTL Group really makes a difference in cases where the company HQ is outside of China and the local staff is expected to perform at a high level, in accordance with the company’s global strategies and policies.
Let’s Discuss China Employment Laws
Employment laws are very important, and as an employer, the last thing you want to do is break them (even if by accident). Like every other country in the world, China has its own employment laws. As a foreign company operating a business entity in China, we highly recommend that you familiarize yourself with China’s employment laws. In the meantime, here is some information you should be aware of:
- Labor agreements: Every employer must terminate employee contracts every once in a while. This is part of business reality. In China, if you set an end date to your employees’ labor contract, you can simply decide not to renew them. Of course, this does not affect the severance pay that you still have to pay according to law. Oh, and another important thing: difference provinces in China have different labor laws, so drafting a labor contract in Hong Kong differs somewhat from a similar contract in Shanghai or other regions. And remember: before you do anything regarding labor contracts or employee termination, consult with an HR management service professional in China.
- Employee expectations: Cultural differences should not deter you from understanding how your employees think and what they expect from their place of employment. So what do your Chinese employees expect from their employers? For starters, they expect an annual salary raise as an appreciation of their hard work, as well as certain special allowances. They also expect to work in an environment that respects them and that provides them with high-quality working conditions. In this respect, they are no different from employees in any other country. If they feel that their expectations are not met, don’t be surprised if they look for another job. If you’re not sure how to manage you employees’ expectations, you should definitely confer with a provider of HR services in China.
- The importance of the background check: As part of the candidate screening process, don’t skip the background check stage. If you don’t have the tools to do it yourself, employ a local agency to do it for you. A background check can often uncover important facts that you would like to know before hiring a promising candidate – including former and current places of employment.
- The Employee Handbook: The employee handbook is yet another concept that is prevalent in China but perhaps not in other countries. This handbook operates as the de-facto guidelines for the company’s way of operating and conducting business. Why is this so important? Because it leaves no room for interpretation on how to behave as a company employee. As the owner of the company, we recommend that you have all of your employees sign the employee handbook. The employee handbook is considered a legal document in China, and having your employees sign it will protect your company in case of a work-related dispute.
- Freelancers – yes or no? In many countries, hiring freelancers for specific tasks is very advantageous because you don’t have to deal with all of the employment bureaucracy, employee benefits, etc. But things are different when running a business entity China from afar. When managing remotely from another country, you need maximum control over deliverables and overall performance – and that is exactly what you won’t be getting when hiring a freelancer. If you’re an international company actively recruiting in China, we think it’s always better to hire a professional as a direct employee.
- Gender equality: China has made great strides in this area over the years. More and more women are occupying senior positions, and in 2022, China has made amendments to the Women’s Rights and Interests Protection Law. Some of these amendments include prohibiting employers from making gender-based hiring decisions, or from preventing pregnant women and women on maternity leave from exercising their full legal rights. In addition, the definition of sexual harassment in the workplace has been clarified and expanded, and workplaces are encouraged to fight sexual harassment within their confines.