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China EOR & PEO

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Hire in China

A China Employer of Record (EOR) is an HR provider that hires and pays your team in China, on your behalf.

A China EOR solution is commonly used by international companies expanding into China, or global firms interested in hiring specialist talent there.

Horizons is a leading China EOR, hiring and onboarding your China-based team, processing payroll, and ensuring full compliance with local labor and tax laws. A China EOR, also known as a China Professional Employer Organization (PEO), also absorbs all local employer liabilities.

Partnering with our China EOR is the quickest and most cost-effective way to enter the Chinese market.

Facts & Stats

EOR Platform

Hire in China, and pay employees through our platform or app.

EOR Cost

Our China EOR solution is the most affordable on the market.

Time-to-hire

Fast China onboarding, hire in as little as 12 hours.

Contracts

We draft compliant China labor contracts.

Local benefits

We manage all China “Five Insurances” mandatory benefits.

180+ Countries

It doesn’t stop with China — we hire employees globally.

hire employees in china

What Is a China EOR?

A China EOR is an independent HR firm that hires and pays your team in China, in full compliance with local laws. By engaging a China EOR, you no longer need to set up a China entity or subsidiary (such as a Wholly Foreign Owned Enterprise or WFOE) in order to have a China-based team. A China EOR will:

  1. Draft compliant employment contracts for your China team.
  2. Hire and onboard employees on their China payroll.
  3. File all necessary paperwork for China employees.
  4. Process payroll and pay employees on schedule each month.
  5. Take care of compliance, HR or termination issues as they arise.

A China EOR may be a company that operates only in China, or it may be a global EOR that hires employees in China and in other countries around the world.

Save Money And Time with A China EOR

What Are the Benefits of a China EOR?

The benefits of using a China EOR service, rather than setting up your own subsidiary in China include:

  1. Saving money. Engaging a China EOR, rather than setting up a local subsidiary, will save you up to 85 percent of the cost of expanding into China.
  2. Speed to hire. With the Horizons China EOR solution, you can have your China team ready to go in as little as 12 hours. Where you set up your own subsidiary, it could take months.
  3. Ensuring full compliance with China labor laws. Labor law in China can be complex for new entrants into the market. A China EOR will ensure full labor law compliance with key requirements such as the Five Insurances and payroll taxes.
  4. Simplified payroll. When you use a EOR operating both in China and other locations, you only need to pay one invoice every month to cover it all.
  5. 360° HR and recruitment. Horizons China EOR not only hires and pays your team in China, but also has in-house recruitment and can guide any international staff through the China work visa process.
Horizons is Best IN Class

Why Choose Horizons?

Horizons stands out as a China EOR through:

  1. Regional HQ in Shanghai, meaning senior management are on the ground to deal with any issues.
  2. Client-focused infrastructure. Horizons won’t oversell you on products and services you don’t need. Horizons offers the easiest platform to compliantly hire and pay people worldwide.
  3. Cost-effective solutions. At $299 per employee, per month, no EOR in China is more affordable. The cost is 100% transparent (onboarding, offboarding, deposit, no extra charges).
  4. A customer-first culture. Horizons is an efficient bootstrapped company. It is not an externally-funded company burning investor cash to aggressively acquire new clients. Horizons is the only EOR that grows with its customer, reflecting the level of care and personal attention provided to each customer. Horizons will carefully advise on the best setup in each country: the type of contract needed, how to structure your benefits, and how to offboard a person while minimizing the risk of conflicts and extra cost
  5. A long-term partnership. Horizons is the only EOR platform with a recruitment arm — a direct response to client demand. If any employee is leaving, or if our clients want to explore a new country, Horizons can recruit new candidates directly for the client.  Horizons is:
    • The only EOR doing this in-house — no subcontracting
    • The only EOR doing this without a retainer — clients are only charged upon success
    • The only EOR charging just a 2% fee per month
Step-by-step China EOR

How Does a China EOR Work?

When you engage a China EOR, it will:

  1. Hire your China employees. The China EOR becomes the legal employer of your employees in China, taking care of legal and HR responsibilities. This leaves you to focus on day-to-day company operations.
  2. Manage employment contracts and onboarding. The EOR assists in drafting compliant China labor contracts, including terms on salary, benefits, working hours, and termination procedures. They also manage the onboarding process, ensuring that employees are legally registered and understand their employment terms.
  3. Process payroll and handle employment taxes. The China EOR takes care of payroll processing, ensuring accurate calculation of wages, social benefits, and taxes according to Chinese regulations. They also handle tax filings and ensure compliance with local tax laws, reducing the risk of penalties for non-compliance.
  4. Administer benefits. The China EOR can provide employees with access to competitive benefits packages, including health insurance, pension schemes, and other perks. Since EORs pool employees from multiple companies, they often can negotiate better rates for these benefits.
  5. Take care of exit procedures. If an employment relationship needs to end, the EOR handles the termination process in accordance with Chinese labor law, including severance payments and the final settlement.

To summarize, when your company engages a China EOR, your business is able to focus on strategic objectives and operational needs within the Chinese market, with the EOR taking care of HR functions and legal compliance.

stay compliant with China labor laws

Labor Laws

One of the principal reasons for engaging an EOR in China is to ensure full compliance with China’s employment laws. Here we explain in detail how a China EOR ensures:

  1. Compliance with China employment contract requirements
  2. Compliance with working hours, national holiday provisions, and China social security requirements.

Employment contract types

China requires all employers to provide a compliant employment contract that states the employee’s compensation, benefits, and termination requirements. Employment contracts in China should state the salary and additional compensation in the local Chinese Yuan Renminbi.

When you partner with a China EOR, a team of local experts can assist in drafting strong employment contracts compliant with local regulations. An EOR in China can provide your business with labor contracts in the three forms below.

 

Project-based

Probationary period

No probationary period.

Termination

At completion of the project.

Severance

Max. one months per year of employment.

Fixed-term

Probationary period

Directly related to contract duration:
1-year contract: 1 month probation
2-year contract: 2 month probation
3+ year contract: 6 month probation

Termination notice period

30 days (minimum and maximum allowed by labor law)

Severance

2 months salary per year of service
In cases of justified termination: 1 month’s salary per year of service
In cases of dismissal on serious grounds: none

Indefinite

Probationary period

Not available

Termination notice period

30 days (minimum and maximum allowed by labor law)

Severance

1 month salary per year of service

Working hours in China

China operates with a standard five-day working week that should not surpass 8 hours of work per day or 44 hours per week. Companies typically run on an 8am to 6pm schedule with a one-hour lunch break. There is a strict limit on overtime in China. Overtime is not allowed to exceed 36 hours per month, except where there is an emergency event requiring it. A China EOR ensures that all employment contracts reflect these statutory limits.

Overtime must be compensated in the following way:

For a regular workday:

150% of the standard hourly rate (also known as ‘time and a half’);

For a rest day:

200% of the standard hourly rate, or a day off (also known as ‘double time, or a day in lieu’);

For a statutory holiday:

300% of the standard hourly rate (also known as ‘triple time’).

China has a range of national public holidays that are celebrated annually. In 2024 these holidays are:

 

DateHoliday name
January 1New Year’s Day
February 10-16Chinese New Year
April 4-6Qingming Festival
May 1-3Labor Day
June 7-9Dragon Boat Festival
September 15-17Mid-Autumn Festival
October 1-7National Day

Paid time off

The amount of paid time off employees are eligible to receive is based on how long they have been employed at their current company:

Under 1 year of employment

no leave entitlement

1-10 years of employment

5 days of paid leave annually

10-20 years of employment

10 days of paid leave annually

20+ years of employment

15 days of paid leave annually

Sick leave in China

Employees are entitled to between 3 and 24 months paid leave to address medical ailments and treatment. The exact amount of time off will be based on how long the employee has been with the company. Sick pay should never drop below 80% of the local minimum wage.

Workers compensation for injuries or illnesses incurred while working cover employees with legal entitlements of up to one year’s leave at full pay to receive medical treatment.

Take a look at the chart below to learn more about the specifics of sick leave standards in China:

Less than 6 months of sick leave:

(percentage of regular wages owed to the employee)

Under 1 year of employment

no leave entitlement

1-10 years of employment

5 days of paid leave annually

10-20 years of employment

10 days of paid leave annually

20+ years of employment

15 days of paid leave annually

Over 6 months of sick leave

Under 1 year of employment

40%

1-3 years of employment

50%

3+ years of employment

60%

In order for employees to receive the full wages due to them, workers must present a valid medical certificate from a certified doctor to their employer.

Maternity leave in China

China provides all female employees with 98 days of paid maternity leave. They can begin this leave within 15 days before child birth. Depending on the city, women over 24 are generally provided an additional 30 days for their “late maternity leave.”

Women are traditionally granted full pay during their leave through social security or by their employers. China has laws in place that legally protect women from being terminated while pregnant or breastfeeding a newborn child.

The laws for paternity leave differ greatly by location but typically do not exceed 14 days. Men in Shanghai usually receive three days of paternity leave, while men in Shenzhen generally are granted ten days.

An EOR in China will ensure that all maternity leave obligations are fully complied with.

 

Annual leave in China

As well as standard Chinese compensation laws, many guaranteed benefits and supplemental options are available to employees. As China celebrates seven national holidays, the statutory minimum notes that employees be paid leave for each holiday. While this is the statutory minimum, several employers elect to provide employees with greater flexibility around holidays like the Chinese New Year.

In addition to national holidays, annual vacation leave is another important employee benefit in China. Depending on how long an employee has been with an organization, there will be a set number of vacation days each year. In China, vacation days follow the following criteria:

  1. For employees that have been with a company less than a year, there are no mandatory vacation days.
  2. For employees that have been with a company between one and 10 years, there are five vacation days each year.
  3. Employees that have worked for a company between 10 and 20 years receive 10 days annual vacation.
  4. If an employee has been with an organization for at least 20 years, they are entitled to 15 days vacation each year.

For foreign employers that are looking to hire either mid-level or senior executives, more vacation days are generally offered. In fact, it is common for such offers to come with up to four weeks of vacation time per year.

Termination & severance in China

In order to terminate an employee in China, there must be strong cause for dismissal and clearly documented grievances leading up to the termination. The initial employment contract must contain an agreed upon probationary period that can last up to six months in length.

Specific time requirements for submitting a notice of termination vary widely by industry. Any employer terminating an employee of between one month and two year’s tenure must provide at least one week’s notice. Employees working for a company for over two years require notice of one week for each year of completed service up to 12 weeks of notice.

Employers have the option of including “payment in lieu of notice” in employee contracts which permit employers to pay employees instead of providing them with a notice of termination. This is common in Chinese business practice.

Navigating employee terminations and handling severance packages can be complicated for companies expanding overseas for the first time.

Setting up a EOR in China can mitigate risk for foreign companies and provide guidance through this process.

China's compulsory social security contributions

Chinese employees are provided statutory benefits through the “five insurances” practice in China. These include health insurance, pension, worker’s compensation, maternity benefits, and unemployment insurance. However, additional benefits, such as housing, are predicated on the income tax bracket of the individual employee.

These benefits are paid out of social contributions paid by both the employee and employer. More on this below.

China social security for foreigners

Different rules are applied to social security contributions from foreigners and Chinese nationals.

Foreign employees in Shanghai are not yet required to pay the Chinese social security for foreign nationals. In other cities in China, foreigners must pay the full amount of Chinese social insurance.

An EOR in China will ensure that all employees are paying the correct contributions.

Individual income tax

Effective January 1st, 2019, China has adjusted tax brackets and changed residency rules to reduce the tax burden on low-income earners, with new special additional deductions available for resident taxpayers.

The Individual Income Tax is calculated on an annual basis. The China EOR will automatically withhold taxes in advance on a monthly basis on the accumulated income and deductions. Individuals may have additional taxes or tax returns to claim through the annual settlement process.

Health insurance

Standard health and pension insurance is provided through the national system, although supplementary health insurance can be provided to the employees.

hassle-free chinese compensation & benefits

Compensation & Benefits

China compensation laws

The minimum wage in China varies by region. For example, Shanghai has the highest monthly minimum wage at RMB 2,690, and Beijing has the highest hourly minimum wage at RMB 26.4​ (China Briefing)

13 month salary in China

The 13th month salary is the standard type of bonus provided to employees working in China at the end of the year. Rewarding employees with the 13th month salary is extremely common in China. As such, we recommend being clear with the employee during the employment contract phase so the employee is aware of the bonus stipulations regarding their annual salary and bonus structure.

Social security for Chinese nationals

As mentioned above, Chinese employees are provided with statutory benefits through the “five insurances” practice in China. These include health insurance, pension, worker’s compensation, maternity benefits, and unemployment insurance.

They are all funded through ‘social pooling’, formed from payments made by the state, employer and employee, to varying degrees. Entitlements are then acquired through contribution.

However, additional benefits, such as housing, are predicated by the income tax bracket of the individual employee. China’s housing fund system allows Chinese employees to save money towards purchasing their own house, thus providing a way for local employees to have the means to ensure social security and stability in the country. The Housing Fund has no social pool, since the entire amount goes directly to employees’ personal Housing Fund accounts. An EOR in China will always ensure that social security obligations are fully complied with.

Hire and pay talents
with Horizons in
180+ countries

Hire in China in 24h without your own local entity.

With Horizons, you get quick service, transparent pricing, and expert support.

Frequently asked questions

A China EOR can hire employees of all nationality as long as their profiles match with the requirements established by the Chinese immigration authorities.

Horizons can hire your staff everywhere in China through its PEO network of local entities specialized in HR management services.

The China EOR prepares all payroll calculation (including social charges, taxes, benefits, expenses claim, etc.) on your behalf – as the employer of record of your employee(s) in China.

All mandatory social charges contributions, housing fund contributions and income tax payments are paid directly to the Chinese authorities and relevant third-parties by Horizons. Both the foreign company and its employee(s) can access the records of all payments at any time.

The number of employees dispatched in China is not limited and can vary according to the ongoing projects and business development.

All mandatory payments stated on the labor contract shall be paid by the China PEO. Additional payments (e.g. expenses) can be reimbursed by the PEO on your behalf.

No severance pay has to be paid during the probationary period, then the amount of the termination pay is usually 1 or 2 months salary per year of seniority, depending on the labor contract nature and the reason for termination.

In China, work from home is authorized as long as the employer gives its approval.

Horizons provide China recruitment services and EOR services, available for both foreign and local professionals from any background.

Horizons can implement any changes directly with the employee on your behalf.

The overall salary package of employees in China includes base salary, top-ups and any benefits. The key elements include:

Base Salary
Optional ‘top ups’, such as a performance bonus, commission or remote work stipend

’13th month’ salary

Compulsory benefits including leave entitlements, the five social insurances and contributions to the housing fund

Additional (optional) health insurance.

When expanding internationally, it is crucial to calculate what the total cost per employee (the ‘payroll cost’) will be. In China, this means adding together the cost of net salary, employer and employee social insurance contributions, any additional allowances and income tax.

Paid public holidays in China are:

New Year’s day (1 day paid leave)
Chinese New Year (3 days paid leave)
Qing Ming Festival (1 day paid leave)
Labor Day (1 day paid leave)
Dragon Boat Festival (1 day paid leave)
Mid-Autumn Festival (1 day paid leave)
China National Holiday (3 days paid leave).

Special rates apply if organizations require staff to work on public holidays.

In China, the terms “Employer of Record” and “Professional Employer Organization” are generally used interchangeably.