GLOBAL EMPLOYER OF RECORD IN 190+ coun tries
Employer of Record in China
Hire the local or international talent you need in China without making your own entity a prerequisite for every role. Acumen acts as your Employer of Record, enabling you to put key hires in place and develop the team while your longer-term market structure takes shape.
GLOBAL EMPLOYER OF RECORD
Global coverage
Acumen International delivers global employment solutions across 190+ countries.
Strategic markets
Hiring and compliance support across North America, Europe, and Asia-Pacific.
Established jurisdictions
Lawful employment and payroll in regulated, compliance-intensive countries.
Growth economies
Expanding into new regions? Hiring support across fast-moving economies.
Risky and remote locations
Compliant employment solutions in jurisdictions with limited infrastructure.
Employing in China through an Employer of Record
An Employer of Record is a third party that carries the legal and administrative side of employment on behalf of another company. In China, Acumen International becomes the employer of the professionals who work for your business: it signs their labour contracts, runs payroll and individual income tax, pays social insurance and the housing fund in the city where each person works, and handles work permits for foreign staff. Your business chooses the people, sets their goals and leads their work.
A company can therefore build capability in China, whether a sales team in Shanghai, engineers in Shenzhen or a sourcing manager in Ningbo, without first setting up a wholly foreign-owned enterprise and without altering its group structure. The team can grow city by city, and the decision on a Chinese entity can be made once the business case is proven. Where the right person has not yet been found, Acumen International can also run the search, from specialist recruitment to executive search, with background and education checks before the offer.
Situations where an Employer of Record serves a China hire
- Contractor compliance. Professionals who have worked for you in China as consultants move onto labour contracts with social insurance paid, so the arrangement matches what is in substance employment.
- One accountable provider. Contracts, payroll, social insurance across different cities and work permits sit with one provider rather than a separate agency in each city.
- No entity to set up or maintain. You employ in China without the capital, licences, annual audits and bank accounts that a wholly foreign-owned enterprise needs.
- Market tests and short-term projects. A first sales hire or a supplier development project is staffed in China, then expanded or closed as the results show.
- Bridge to your own entity. While your Chinese company is being registered, the first hires start with Acumen International and transfer once it can employ them.
- Fast team launch. Chinese professionals start on Acumen International’s contracts while work permits for foreign managers are processed.
- Mergers and restructuring. Staff in China stay employed without a break while the group structure around them changes.
- NGO staffing. International non-profits registered under China’s Overseas NGO Law have programme and technical staff employed within the rules that govern how they may hire.
- Employer liability. Acumen International carries the Chinese employer’s obligations, so statutory duties sit with the party that labour arbitration commissions and social insurance bureaus hold accountable.
- Remote team expansion. People based in China join a distributed team on Chinese contracts, with contributions paid where they live.
Employing for another business in China: the legal basis and its limits
A Chinese labour contract can only be concluded by an employer established in China, so a company with no Chinese entity cannot sign one itself. Under an Employer of Record, Acumen International holds the employment in China and provides the people’s services to your business under a commercial agreement. Chinese law draws clear lines around this model:
- Labour dispatch is licensed and narrow. A dispatch business needs a licence and registered capital of at least RMB 2 million (Labor Contract Law, Art. 57), must give dispatched workers fixed-term contracts of two years or more (Art. 58), and may place them only in temporary, auxiliary or substitute positions (Art. 66), within 10% of the host’s workforce under the 2014 Interim Provisions on Labor Dispatch.
- Representative offices cannot hire Chinese staff directly. A foreign company’s representative office takes on Chinese employees through a foreign enterprise service company; it is exempt from the dispatch position limits and the 10% cap.
- Changing the employer does not reset service. Under the Supreme People’s Court’s Interpretation II on labour disputes, in force since 1 September 2025, moving an employee to another contracting entity while the job stays the same counts towards the two consecutive fixed-term contracts that entitle them to an open-ended one. Transfers to your own entity are planned with that in mind.
- Social insurance cannot be waived. The same interpretation voids any agreement not to pay social insurance, and lets the employee resign and claim severance if contributions are missed.
What Acumen International handles in China, from recruitment to exit
| Stage | What it involves in China |
|---|---|
| Recruitment and checks | Finding the candidate where needed, with background and education checks before the offer |
| Work permit | The Foreigner’s Work Permit, Z visa and residence permit for a foreign hire |
| Labour contract | A written contract signed within one month of the start date, with probation, confidentiality and, where justified, non-compete terms |
| Registration | Enrolment with the social insurance and housing fund authorities in the employee’s city |
| Payroll | Monthly salary in renminbi with individual income tax withheld and filed |
| Contributions | Social insurance and housing fund paid each month at the local bases and rates |
| Exit | Notice, statutory severance, the termination certificate and transfer of the employee’s records |
Minimum wages and pay rules in China
China has no single national minimum wage. Each province and municipality sets its own monthly and hourly rates, often in tiers for different areas, and reviews them every few years. The highest are in the largest cities:
| City | Monthly minimum | In force since |
|---|---|---|
| Shanghai | RMB 2,740 | 1 July 2025 |
| Beijing | RMB 2,540 | 1 September 2025 |
| Shenzhen | RMB 2,520 | Rate in force in 2026 |
The minimum excludes overtime pay and special allowances, and in Shanghai it is also calculated before the employee’s own social insurance and housing fund contributions. Wages are paid in renminbi at least once a month.
For professional hires, the reference point is the market, not the minimum. Packages are usually expressed as a monthly salary multiplied by 13 or more, with the annual bonus agreed in the contract, and the salary chosen also sets the base for social insurance and severance.
Labour contracts and working time in China
Chinese labour law is strongly written in the employee’s favour, and most of its protections cannot be contracted out of. The contract is where an employer’s flexibility is won or lost, so it is drafted carefully from the start.
| Topic | What applies |
|---|---|
| Written contract | Must be signed within one month of the start; from the second month the employee is owed double wages until it is (Labor Contract Law, Arts. 10 and 82) |
| Probation | Up to 1 month for contracts of 3 months to under a year, 2 months for 1 to 3 years, and 6 months for 3 years or more or open-ended; only once per employee (Art. 19) |
| Open-ended contracts | Due after 10 years’ service or on renewal after two consecutive fixed-term contracts (Art. 14) |
| Non-compete | Up to two years after leaving, with monthly compensation, and only for staff with access to trade secrets or confidential know-how (Arts. 23–24; Interpretation II) |
| Working hours | 8 hours a day and 40 a week, with overtime normally capped at 36 hours a month; flexible or averaged hours need approval from the labour bureau |
| Overtime pay | 150% on working days, 200% on rest days unless time off is given, 300% on public holidays |
Ending employment in China
China has no termination at will. An employer may end a contract only on a ground the Labor Contract Law lists, and an unsupported dismissal costs twice the normal severance (Art. 87) or reinstatement. In practice, most exits are agreed with the employee and documented as a mutual termination.
- Termination with notice: for incapacity after illness, proven incompetence after training or reassignment, or a fundamental change of circumstances, the employer gives 30 days’ written notice or one month’s pay instead (Art. 40).
- Severance: one month’s wage per year of service, and half a month for service under six months. Where pay exceeds three times the local average wage, the monthly figure is capped at that level and the years at 12 (Art. 47).
- Expiry of a fixed term: severance is still due unless the employee turns down renewal on the same or better terms.
- Collective redundancy: cutting 20 or more people, or 10% of the workforce, requires explaining the plan to the union or all staff 30 days in advance and reporting it to the labour authority (Art. 41).
- Protected employees: staff who are pregnant or on maternity leave, in a medical treatment period, or within five years of retirement after 15 years’ service cannot be dismissed on notice or for redundancy (Art. 42).
- Foreign employees: the work permit and residence permit are cancelled when the employment ends.
Employment risks in China and how Acumen International mitigates them
| Risk | Where it arises in China | How Acumen International mitigates it |
|---|---|---|
| Worker misclassification | A consultant paid from abroad who works full time under your direction can be found to be your employee, with social insurance arrears | The person moves onto a Chinese labour contract with contributions paid from the first month |
| IP ownership | Inventions made in the course of the job belong to the employing entity, and Chinese staff often expect separate inventor remuneration | Contracts assign the rights and set inventor rewards, and the rights are passed on to your business |
| Client liability for pay and contributions | A business that benefits from dispatched labour can be held jointly liable for harm to the workers | Pay, contributions and records are kept complete and on time |
| Equal pay for assigned staff | Dispatched workers are entitled to equal pay for equal work with the host’s own staff (Art. 63) | Pay is benchmarked against comparable roles before the offer |
| Permanent establishment | Staff who negotiate and sign contracts in China for your company can create a taxable presence and unregistered business activity | Roles are scoped to support functions and signing authority stays outside China |
| Exit cost | Severance is statutory, unlawful dismissal costs double, and some employees are protected from dismissal | Exits are planned on a lawful ground or agreed, with costs calculated in advance |
| Sponsor obligations | A foreign employee may work only for the employer and in the post on the work permit | Permits are kept aligned with the actual role and renewed before expiry |
Work permits for foreign professionals in China
China welcomes senior foreign talent but screens it closely. Every foreign employee needs a Foreigner’s Work Permit, applied for by a defined employer in China, and the system grades applicants into three categories:
- Category A, high-end talent: recognised experts, senior executives and highly paid specialists, with faster processing and fewer limits.
- Category B, foreign professionals: usually a bachelor’s degree and at least two years’ relevant experience, assessed on a points scale in which salary, education, experience and Chinese language all count.
- Category C, other foreign workers: subject to quotas and rarely relevant to professional hires.
The route runs in a fixed order. The employer obtains a work permit notification online; the employee applies for a Z visa at a Chinese consulate; after entry the work permit card is issued, and the residence permit must be applied for within 30 days of arrival (Exit and Entry Administration Law, Art. 30). Degree and no-criminal-record certificates must be authenticated, which since China joined the Apostille Convention in November 2023 can be done by apostille in most home countries.
What Acumen International contributes
- A Chinese employer to stand behind the application. The work permit is tied to the employer in China. Acumen International applies as that employer, so your foreign manager or specialist can be approved without your business first establishing itself.
- An offer that scores. Salary, title and contract terms are set with the points scale in mind, so a candidate who qualifies on substance is not marked down on presentation.
- Documents that pass first time. Degrees, employment references and criminal record certificates are prepared and authenticated in the form the bureau expects, the most common cause of delay.
- Status kept valid. Permits are renewed before expiry, and a change of role, city or salary is reported so the permit continues to match the job.
Family members
A spouse and children under 18 can join on family residence permits linked to the employee’s. A spouse who wants to work needs a work permit of their own.
Employer cost and income tax in China
Social insurance and the housing fund
Every employee, Chinese or foreign, is enrolled in five social insurance schemes and the housing provident fund in the city where they work. Rates and the contribution base are set locally: the base is the employee’s salary, held between a floor and a ceiling that each city revises every year.
| Scheme | Who pays |
|---|---|
| Pension | Employer 16%, employee 8% |
| Medical, including maternity | Employer and employee, at local rates |
| Unemployment | Employer and employee, at local rates |
| Work injury | Employer only, at a rate set by industry risk |
| Housing provident fund | Employer and employee equally, between 5% and 12% of salary |
Foreign employees have been required to join since 2011. Nationals of countries with a social security agreement with China, including Germany, South Korea and Japan, can be exempted from some schemes during a secondment.
Individual income tax
Tax is withheld monthly on a cumulative basis and settled in an annual reconciliation. Residents receive a standard deduction of RMB 60,000 a year plus special deductions, and are taxed at progressive rates:
| Annual taxable income (RMB) | Rate |
|---|---|
| Up to 36,000 | 3% |
| 36,001 – 144,000 | 10% |
| 144,001 – 300,000 | 20% |
| 300,001 – 420,000 | 25% |
| 420,001 – 660,000 | 30% |
| 660,001 – 960,000 | 35% |
| Above 960,000 | 45% |
Foreign employees can receive housing, children’s education and language training allowances free of tax until 31 December 2027, as an alternative to the special deductions. Packages for foreign hires are structured with that choice in mind.
Sectors employing through an Employer of Record in China
- Advanced manufacturing and supply chains: sourcing, quality and supplier development managers in the Yangtze and Pearl River deltas.
- Automotive and new energy: engineers and programme leads working with China’s electric vehicle, battery and solar industries.
- Life sciences and healthcare: regulatory affairs, clinical and medical affairs specialists preparing products for the Chinese market.
- Technology and research and development: software engineers, data specialists and product managers in Beijing, Shanghai, Shenzhen and Hangzhou.
- Consumer goods, retail and luxury: brand, e-commerce and channel managers for one of the world’s largest consumer markets.
- Professional and financial services: business development, compliance and client relationship staff supporting cross-border work.
Hiring cases in China and how they are handled
| Case | What Chinese regulations add | How Acumen International handles it |
|---|---|---|
| A European machinery maker with no Chinese entity hires a sales engineer in Suzhou | Only an employer established in China can sign the labour contract, and contributions are paid in Suzhou | Acumen International employs him with full Suzhou registration and payroll, while customer contracts stay with the European company, so he sells in China without creating a taxable presence |
| A software company appoints a foreign engineering manager for its Shanghai team | A points-assessed Category B work permit, then a residence permit within 30 days of entry | Acumen International sponsors the permits on an offer built to score, adds tax-free allowances and renews on time, so he leads the team lawfully throughout |
| After 18 months the client registers its own company and wants the team moved across | No automatic transfer of employment, and a change of employer counts towards an open-ended contract | With each employee’s signed consent, the team moves to the new company with service recognised and new work permits, so there is no severance and no gap in cover |
| A market test ends after a year and the role is closed | No termination at will; severance of one month’s pay per year of service | Acumen International agrees a mutual termination and settles severance, leave and records, closing the role with no open claims |
Benefits, payroll and leave in China
Professional packages in China’s major cities commonly add supplementary commercial medical insurance, a contribution to the housing fund above the minimum, meal and transport allowances, and an annual bonus; senior hires may also expect an enterprise annuity.
Payroll obligations
| When | What happens |
|---|---|
| Within one month of the start | The labour contract is signed and the employee is registered for social insurance and the housing fund |
| Every month | Salary is paid, and income tax and contributions are declared and paid by the 15th of the following month |
| Once a year | Contribution bases are reset to the city’s new floor and ceiling, usually around mid-year |
| 1 March – 30 June | Employees complete the annual income tax reconciliation for the previous year |
Leave entitlements
| Leave | Entitlement |
|---|---|
| Public holidays | 13 days a year since 1 January 2025 |
| Annual leave | 5 days after one year of total working life, 10 days after 10 years and 15 days after 20 years, counting service with all employers |
| Maternity leave | 98 days nationally, extended by provincial rules, commonly to 158 days or more |
| Sick leave | A protected medical treatment period of 3 to 24 months depending on service, with sick pay of at least 80% of the local minimum wage |
Sources
- Labor Contract Law of the People’s Republic of China
- Interim Provisions on Labor Dispatch
- How to apply for the Notification Letter of Foreigner’s Work Permit
- Extension of preferential individual income tax policies on benefits granted to foreigners
- Minimum wage updated in Shanghai from 1 July 2025
- Minimum wage increased in Beijing from 1 September 2025
FREQUENTLY ASKED QUESTIONS
Got questions?
We’ve got answers
Have questions about hiring globally? You’re not alone. Below you’ll find answers to the most common questions from teams expanding into new markets — from compliance and onboarding timelines to payroll and local benefits.
If you don’t see what you’re looking for, our team of in-country experts is always ready to help you navigate the details.
Can an Employer of Record bridge employment during an acquisition or restructuring in China?
Yes, where the proposed employee transition is locally feasible. An Employer of Record can provide employment continuity in China while a buyer establishes its own entity, a workforce separates from a seller, or a post-deal operating structure is being put in place.
Can Acumen employ a director or regulated professional in China?
Not every position is suitable for an Employer of Record. If a role in China carries statutory office, professional registration, sector licensing, local ownership or other role-specific requirements, Acumen reviews feasibility before confirming the employment structure.
Can we employ a country manager or sales lead in China through an Employer of Record?
Potentially. Senior commercial roles can often be employed through an Employer of Record, but the employee’s activities may create corporate tax, registration, licensing or permanent-establishment considerations for the client. Acumen can assess the employment setup; the wider corporate risk should be considered alongside it.