Information date: 22 September 2026 — Employers in China must sign a written labour contract with each employee within one month of the start of work, and must enrol staff in the statutory social insurance schemes covering pension, medical, unemployment, work injury and maternity, plus the housing provident fund. Contributions are shared between employer and employee and calculated on a local contribution base, with city-specific rates, floors and ceilings adjusted annually by each municipality. Knowing that statement is not enough for an operating, research or compliance decision. The team must first establish who and what it applies to, how the effect reaches the real process, and which evidence would justify action.
Verified facts and scope
Employers in China must sign a written labour contract with each employee within one month of the start of work, and must enrol staff in the statutory social insurance schemes covering pension, medical, unemployment, work injury and maternity, plus the housing provident fund. Contributions are shared between employer and employee and calculated on a local contribution base, with city-specific rates, floors and ceilings adjusted annually by each municipality.
Applies to any entity hiring locally, including wholly foreign-owned enterprises and representative offices. Before running payroll, confirm the city where the entity is registered, because social insurance and provident fund accounts are administered locally; confirm whether foreign employees are covered in that city; and review probation rules, working-hour systems, overtime treatment, statutory leave and whether internal rules require employee consultation before taking effect.
How the effect reaches operations
Social insurance is a locally administered funded system rather than one national account, so an identical salary produces different employer cost in different cities. Enforcement has become data-driven: payroll, individual income tax filings and social insurance declarations are cross-checked, so under-declaring the contribution base leaves a visible gap between what you report to the tax authority and what you declare to the social insurance bureau.
Recurring mistakes include treating probation as a period without social insurance, rolling fixed-term contracts to avoid open-ended obligations without checking renewal rules, and letting an unregistered local office sign contracts. Discounted 'social insurance optimisation' packages sold by intermediaries can be recharacterised as evasion, with back payments, late fees and penalties landing on the employer rather than the adviser.
For “Hiring in China: A Practical Guide to Labour Contracts and Social Insurance for New WFOEs”, official rules or published findings, direct evidence from the relevant product or process, and assumptions that remain untested should be recorded separately. A broad source defines the external boundary; it does not replace batch records, protocols, contracts, labels or direct observations.
Decision
If you are hiring under ten people, budget statutory cost by city rather than by a national average. If you intend to use dispatched labour, keep it well below the permitted share of headcount and verify the staffing firm's licence. If you plan to relocate or reduce headcount, model severance, notice and consultation requirements before announcing, not after the first resignation letter arrives.
Implementation checklist
- Ask a local payroll provider for the current rate card in your registration city.
- Sign written labour contracts within one month of each start date, without exception.
- Keep dated records of handbook publication and employee acknowledgement.
- Assign one decision owner, one implementation owner and a dated review point for “Hiring in China: A Practical Guide to Labour Contracts and Social Insurance for New WFOEs”.
- For “Hiring in China: A Practical Guide to Labour Contracts and Social Insurance for New WFOEs”, archive the source page, access date, applicable population or entity, and internal evidence both supporting and opposing the current decision.
- When a rule, formulation, supplier, protocol or observed result changes, reopen only the affected question in “Hiring in China: A Practical Guide to Labour Contracts and Social Insurance for New WFOEs”.
Evidence and review
For “Hiring in China: A Practical Guide to Labour Contracts and Social Insurance for New WFOEs”, start with one real case rather than an abstract checklist. Record the input version, responsible owner, start time, observed result and stop condition. If the team cannot complete “Ask a local payroll provider for the current rate card in your registration city.” with current evidence, it should not expand the process to more products, patients, suppliers or markets. The first review should focus only on facts capable of changing the decision.
The second control follows “Sign written labour contracts within one month of each start date, without exception.”. Keep the source date, applicable population or entity, deadline, cost effect and owner in the same evidence file. A wording preference does not justify a new version. A repeated discrepancy, an unsupported health claim or a regulatory mismatch does: correct that point and hold release until the evidence is available.
After “Keep dated records of handbook publication and employee acknowledgement.”, compare the intended outcome with what actually happened. Apply the same success criteria to each later expansion. If only one number, date or responsibility changes, update that field and the affected conclusion instead of recreating evidence that remains valid. This keeps the decision traceable without turning review into an open-ended rewrite cycle.
Limits of the conclusion
This guide describes general statutory practice and local variation; it is not employment law advice, and the applicable rates, floors and procedural rules must be confirmed with the competent local human resources and social security bureau.
