Employer of Record in China in 2025

China is the second-largest economy in the world and a critical market for global businesses. ]With over 1.4 billion people, advanced manufacturing capabilities, rapid technological growth, and some of the most dynamic consumer markets on the planet, it offers unparalleled opportunities for companies looking to expand. 

Major hubs such as Shanghai, Beijing, Shenzhen, and Guangzhou host world-class industries in finance, technology, logistics, and manufacturing.

Yet, entering the Chinese market can be daunting. Setting up a local entity, typically a Wholly Foreign-Owned Enterprise (WFOE) or Joint Venture (JV),  requires multiple government approvals, strict regulatory compliance, local bank accounts, and ongoing reporting obligations. The process can take months and involves significant costs before your first hire is even onboarded.

Employer of Record in China services from INS Global provide a faster, simpler, and compliant alternative. 

Acting as your legal employer in China, we handle labor contracts, payroll, benefits, tax filings, and compliance with Chinese labor laws, while you manage your employees’ day-to-day work. With nearly two decades of experience in over 160 countries, INS Global ensures you can hire top talent in China without delays or unnecessary risks.

The Strategic Advantage of Hiring in China

China offers a unique blend of scale, skill, and innovation that few countries can match:

• Massive domestic market: Access to over a billion consumers with rising purchasing power.

• Global manufacturing hub: Expertise in electronics, automotive, textiles, and industrial equipment.

• Technology leadership: Rapid growth in AI, e-commerce, fintech, and renewable energy.

• Regional variety: Diverse talent pools across provinces, with specialized strengths in different cities.

• Government-backed infrastructure: Modern transportation, logistics, and industrial parks.

• R&D opportunities: Strong incentives for innovation, especially in high-tech sectors.
  

Employer of Record China solutions enable you to leverage these strengths immediately, without having to navigate the lengthy entity setup process.

Understanding the Chinese Employment Framework

China’s labor laws are governed primarily by the Labor Law of the People’s Republic of China, the Labor Contract Law, and a variety of regional regulations. Compliance is strict, and violations can result in financial penalties and reputational damage.

Employment Contracts

Written contracts are mandatory and must be provided within one month of the start date.

They must detail job duties, work location, salary, working hours, benefits, and termination conditions. Contracts are typically in Mandarin and may include both Chinese and English versions, with the Chinese version prevailing in disputes.

Payroll and Tax Compliance

Employers must process monthly payroll and withhold individual income tax based on progressive tax brackets, along with mandatory social insurance and housing fund contributions. Social insurance covers pension, medical, unemployment, work injury, and maternity benefits, and contribution rates vary by city.

Working Hours and Leave

The standard working schedule is 8 hours per day, 40 hours per week. Overtime is regulated and must be compensated at statutory rates. Annual leave entitlements depend on years of service, starting from 5 days after one year of employment, increasing with tenure. 

Public holidays are set by the State Council and include major festivals like Chinese New Year and National Day.

Probation Periods

The length of the probation period depends on the contract duration, ranging from 1 to 6 months. During probation, employees must receive at least 80% of their regular salary.

Immigration and Work Permits

Foreign nationals require a work permit and residence permit to work legally in China. The process involves:

1. Work Permit Notification: Obtained before entering China.

2. Z Visa: Issued by the Chinese embassy or consulate for entry.

3. Work Permit Card: Obtained upon arrival.

4. Residence Permit: Allows long-term stay and multiple entries.
   

Work permits are categorized into three classes (A, B, C) based on qualifications, salary, and industry demand. Class A is for high-level talent and has the most streamlined process.

Employer of Record services from INS Global include full immigration support, ensuring all documentation is complete, deadlines are met, and renewals are handled seamlessly.

Business Culture and Hiring Practices

Chinese business culture emphasizes relationships (guanxi), trust, and long-term commitment. Negotiations can be detailed and strategic, with a focus on mutual benefit. Respect for hierarchy, punctuality, and maintaining harmony are valued in workplace interactions.

Recruitment practices often involve formal interviews, written tests, and careful reference checks. Candidates expect competitive salaries, benefits packages, and clear career progression. In many sectors, offering additional perks such as housing allowances, transportation subsidies, or performance bonuses can significantly improve recruitment outcomes.

With Employer of Record solutions, your hiring process is aligned with these cultural expectations and fully compliant with local law.

Compliance Challenges for Foreign Employers

Without a local entity, hiring in China presents risks such as:

• Misclassifying employees as contractors, leading to reclassification and backdated contributions.

• Failing to register for social insurance and housing fund in the correct city.

• Incorrectly calculating tax obligations due to city-specific variations.

• Not providing bilingual contracts, creating disputes over terms.

• Inadequate termination procedures, which require strong legal justification and adherence to notice periods or severance pay rules.
  

By partnering with INS Global for Employer of Record in China, you avoid these pitfalls through local expertise and proactive compliance management.

Regional Hiring Hubs in China

• Shanghai: Finance, technology, trade, and luxury goods.

• Beijing: Government, legal, consulting, IT, and education.

• Shenzhen: Technology, manufacturing, and startups.

• Guangzhou: Trade, manufacturing, and logistics.

• Chengdu: Emerging tech hub with lower costs.

• Hangzhou: E-commerce, fintech, and digital innovation.
  

Each city has its own labor cost structures, tax rates, and recruitment conditions. Employer of Record China services allow you to hire in any location without separate entity registration.

Post-Hire Compliance and Ongoing Management

China’s regulatory landscape changes frequently, especially at the provincial and municipal levels. INS Global ensures:

• Continuous monitoring of labor law updates.

• Adjustment of payroll and benefits to match policy changes.

• Proper filing of monthly tax and social insurance reports.

• Management of annual leave accruals and public holiday schedules.

• Compliance with data protection regulations when storing employee information.

Why Choose INS Global for Employer of Record in China

INS Global is your strategic HR and compliance partner for entering and operating in China.

With Employer of Record China services from INS Global, you gain:

• Full Legal Compliance: Contracts, payroll, benefits, and taxes in line with Chinese labor laws and regional regulations.

• Fast Market Entry: Hire and onboard employees in weeks, not months.

• Immigration and Visa Support: Guidance and processing for all work permit types.

• Local Expertise: Advisors who understand both national labor law and local practices.

• Secure HR Technology: ISO 27001-certified systems for payroll, contracts, and data storage.

• Scalability: Hire one employee or a full team without opening a WFOE or JV.

• Proactive Compliance Monitoring: Regular audits and automatic adjustments to match policy changes.
  

Since 2006, INS Global has supported over 3,200 companies expanding into more than 160 countries, maintaining 99% payroll accuracy and 97% customer satisfaction.

Expanding into China with Confidence

China’s scale, diversity, and economic power make it one of the most attractive yet complex markets in the world. Success requires a deep understanding of local labor laws, cultural norms, and city-specific regulations.

By choosing INS Global as your Employer of Record in China partner, you can enter the market quickly, hire top talent anywhere in the country, and operate with complete compliance. We take care of the legal, HR, and administrative requirements so you can focus on building your presence and achieving sustainable growth.

Employer of Record services from INS Global are your direct pathway to long-term success in one of the most competitive and opportunity-rich markets globally.