Essential facts about labour contracts in China

Article exclusively contributed by
Staff Management Consultancy Ltd

Daniel, who wanted to work in mainland China, attended many interviews with different companies and consequently received an offer. He has been working for two months but has not yet signed an employment contract and has no idea when his probation period expires. All other terms have only been agreed verbally between him and his boss. He is now concerned, as no written document has been given to him. He worries whether he has any employment protection.

What should Daniel do?
According to mainland law, a written contract is essential in order to establish an employment relationship. Therefore, Daniel should ask his employer to provide a written contract. Additionally, Daniel should confirm all relevant elements of his employment in a written contract.

Article 19 of the Labour Law stipulates that a labour contract should include provisions for:

- The duration of the labour contract
- A job description
- Labour protection and working conditions
- Remuneration
- Disciplinary measures
- Conditions for termination
- Liability for any breach of the contract

Regarding the length of the contract, there are three types: Fixed term contracts, non-fixed term contracts and contracts that expire upon the completion of work. In accordance with the law, if the employee has been continuously working for not less than 10 years and both parties agree to renew the contract, the employer must establish a non-fixed term contract if the employee so requests.

If necessary, both employer and employee can determine other terms by agreement. Additionally, different provinces or cities may have further rules governing the content of the contract. For example, Guangdong requires provisions for education and training, labour insurance and welfare benefits. It also requires that the contract specify working hours, rest periods and holidays. Shenzhen, meanwhile, requires that a specific pay day be included in the contract along with the method of payment.

Daniel does not know when his probation period expires. There are, in fact, some restrictions on the length of the probation period on the mainland. According to the Labour Law, a probation period can be set for no more than six months. However, the maximum period of probation is further subject to the length of the contract. The stipulations may also vary from province to province, so it is as well to check locally.

There are many differences between the Labour Law in the mainland and the Employment Ordinance in Hong Kong. Employees should understand their rights fully before they start to work on the mainland.

Q & A about labour laws in Mainland China
Q1 Is a Hong Kong resident required to apply for a working visa?
A1 A Hong Kong resident is not required to apply for a working visa. However, a working licence is required and this can be obtained from provincial or municipal authorities. The following documents are required for the application:

- Statement outlining the reason for employment (provided by the employer)
- Copy of the company's business licence
- Application form for employment for residents of Taiwan, Hong Kong and Macau
- Registration form for employment for residents of Taiwan, Hong Kong and Macau
- Copy of the Entry Permit for residents of Hong Kong and Macau
- Employment offer (provided by the employer)
- Education and qualification certificates of the applicant
- Medical examination report issued by a designated hospital
- Three photographs of the applicant
- Other documents as required by the authorities

Q2 Can a foreign investment enterprise use other languages to draft the labour contract?
A2 According to a notice issued by the Ministry of Labour, the contract must be written in Chinese although foreign investment enterprises are free to draft an additional copy of the labour contract in another language. However, the content of the contract, in Chinese or any other languages, should be the same and the Chinese version will prevail in the event of disputes.

Taken from Career Times 30 July 2004

(Last review date: 23 August 2013)

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Disclaimer: The opinions expressed in this article are those of the contributor.

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