Human Resources & Payroll
Human Resources and Payroll in China 2017/18 (6th Edition), the latest publication from China Briefing and Dezan Shira & Associates, is out now and available for download through the Asia Briefing Publication Store.
A firm understanding of China’s laws and regulations related to human resources and payroll management is essential for foreign investors in China. This also applies to local managers and HR professionals who may need to explain complex points of China’s labor policies to employees.
By Chet Scheltema
Negotiated settlement is often required to sever the employment of a senior manager with minimal disruption and expense. This is nowhere more true than in China, where private dispute resolution is strongly favored.
However, in China, the labor dispute system encourages compromise and payment of severance. In some cases, this can encourage employees to negotiate aggressively to force employers into uncomfortable concessions.
For foreigner managers accustomed to dispute resolution processes in the West, where establishing fault and faultless behavior is seen as paramount, especially where fraud or bad faith exists, a greater emphasis in China on making concessions and paying severance to an opportunistic employee may be a bitter pill to swallow. Yet, it may be the most practical recourse.
By Alexander Chipman Koty
In China, regional governments are authorized to set their own minimum wages according to local conditions. If adjustments to minimum wages are made, they usually occur in the first half of the year. However, the cities of Shanghai and Shenzhen and the provinces of Shandong, Fujian, and Shaanxi are the only jurisdictions that have done so in 2017.
Authorities in Shanghai, Shenzhen, Shandong, Fujian, and Shaanxi all increased their minimum wage levels. Although other regions still have ample opportunity to adjust their wages in 2017, the reluctance of a majority of provinces to increase wages in the first half of the year reflects the nationwide concern to keep wage growth in check in order to maintain competitiveness, particularly as China’s economy slows.
By Jake Liddle
Investors may need to send personnel to China on business trips for a variety of reasons, even if there is an existing entity and staff on-site in China.
The most common examples are for negotiations, completing temporary projects, quality control, engineering, training, or consulting purposes.
Travel may consist of visits to attend ceremonies or other types of functions, or longer or more frequent stays.
However, there are many factors involved when sending personnel on business trips to China. Proper management and preparation can help your business trip to China run as smoothly as possible. This article addresses issues for both travelers and HR departments to consider when conducting business trips to China.
By Dezan Shira & Associates
Editor: Weining Hu
In an effort to attract more foreign talents, the State Administration of Foreign Experts Affairs (SAFEA) has quickened reform to make it easier for foreigners to apply for China’s work visa.
Effective on April 1, 2017, the SAFEA rolled out a unified work permit system nationwide that began to process applications both ‘foreign experts’ and ordinary foreign nationals, referred to as R visas and Z visas respectively.
The new system uses a points-based, three-tiered classification system to evaluate which candidates qualify for the work permit.
Compared with the old system, the new one requires fewer supporting application materials, provides a more transparent evaluation process, and shortens turnaround time.
Foreign applicants will benefit from this restructure of the foreign work permit system due to its simpler, clearer, and less time-consuming application process.
By Dezan Shira & Associates
Editor: Alexander Chipman Koty
The Shanghai Municipal Bureau of Human Resources & Social Security recently released its annual minimum wage adjustments for 2017, as well as the associated changes to employee benefits.
The adjustments, which came into effect on April 1, affect minimum wages, medical insurance, social insurance, pensions, and other forms of employee compensation.
By Weining Hu
Unlike the US’ at-will employment system, China uses contract employment. This means employers must make formal written employment contracts with all of their full-time employees. Further, during any term of contract, employers can only terminate employees’ contracts under certain circumstances in accordance with China’s Labor Contract Law (LCL).
China is highly protective of employees’ employment rights. When it comes to salary reduction, employers will encounter many legal restraints when making a potential unilateral pay cut. Employers and HR managers should understand China’s regulatory details before making reduction in an employer’s remuneration, so that they can effectively avoid labor-related legal risks.
The latest issue of China Briefing Magazine, titled “Payroll Processing in China: Challenges and Solutions“, is out now and currently available to subscribers as a complimentary download in the Asia Briefing Publication Store.
- Key Management Challenges for Payroll Processing in China
- IT Solutions: Improving Efficiency, Accuracy and Transparency in Payroll Processing
- Payroll Outsourcing: Allowing SMEs to Focus on Core Business Goals
- China as a Payroll Processing Center for MNCs in Asia