Employment law in China - an overview
04 January 2021
China’s strong economy, large manufacturing base and burgeoning consumer market make it an irresistible place for many Western companies to do business. This in-brief provides a snapshot of some of the key aspects of Chinese employment law. Our Hong Kong office was opened to meet a growing demand from many of our clients for coordinated employment and immigration/global mobility support across the Asia Pacific region (including China).
The employment law landscape
Prior to the economic restructuring and privatisation that occurred in China from around 1979, there were in effect no private employers and virtually no employment law. This has now well and truly changed. Alongside the growth of private employment, recent years have seen increasing levels of employment regulation to address the complexities of this type of relationship which also tends to involve a more mobile, expensive and demanding workforce.
Employment law in China is based on a statutory, civil law system, and there is no formal system of binding case law precedent. Employment law tends to be very pro-employee. There is no “at will” employment and termination of employment is only possible on specific statutory grounds, which in practice can be difficult to satisfy. There are also national and local layers of employment law. In general, local laws clarify the national ones by providing more detail. Enforcement of the national law can vary, sometimes significantly, from region to region. For example, enforcement in Shanghai tends to favour employers over employees to a greater extent than it does in other regions.
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Asia Pacific (APAC) 亞太區
We have been operating in the Asia Pacific for many years, working with our clients as they expand and develop their businesses in the region, and as they seek to do business in Europe and the UK.