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China
Helping businesses expand and employ in China
Meeting compliance requirements while expanding your business in can be extremely challenging. To support you, we are providing an overview of key information in China, addressing everything from hiring regulations to termination regulations.
Want to expand into China?
Contact us today to see how Leap29 can be the trusted partner that supports your global expansion.
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Expanding into China
Key facts
Contract Types
In China, employment contracts can be Fixed Term, Indefinite or for a Project (temporary for a specific purpose). Following two consecutive Fixed Term contracts, the employer must extend an open-ended contract if they wish to retain the employee.
Probation
For Fixed Term contracts probation depends on the length of the contract. For contracts of less than 3 months there is no probation, for contracts of 3 months to 1 year probation can be up to 1 month, 2 months for contracts of up to 2 years and a maximum of 6 months for contracts of 3 years and more. There can be no probation for temporary specific purpose contracts or for part time contracts. 3 months’ probation is commonly given.
Probation cannot be extended.
Working Hours
Chinese labour laws mandate that full-time employees are restricted to working 8 hours per day and a standard 40-hour workweek, with an allowance for a 44-hour workweek on average. Any work that exceeds 8 hours per normal workday must be paid at 1.5 times the employee’s contractually agreed hourly wage. Overtime is strictly limited to no more than 36 hours per month (other than in emergency situations).
Other
There is no mandatory requirement for a 13th month salary but it is often given. The contract should clearly state any entitlement.
Tax rates valid for 2024
Corporation Tax 25% (can be reduced to 15% for qualified enterprises which are encouraged by the Chinese Government)
Employers’ Costs 31.5%-40.2%
Employees’ Cost 15.55-22.5%
Income Tax Rates in Chinese Yuan
0-36,000 – 3%
36,000-144,000 – 10%
144,000-300,000 – 20%
300,000-420,000 – 25%
420,000-660,000 – 30%
660,000 – 960,000 – 35%
960,001 and above – 45%
Chinese Labour Law provides employees with high levels of protection and job security. Termination can be mutually agreed, for just cause (eg misconduct) without fault, such as long term sickness, or redundancy. Terminations in China must follow due process.
Some groups of employees, including pregnant women or women still entitled to breastfeeding breaks, employees on sick leave where the agreed sick leave has not yet expired, employees with over 15 years’ service and those suffering from a work related disease or awaiting diagnosis of such, are protected from termination. An employer could however come to a mutual termination agreement with such employees.
The labour union should be informed in advance of any termination.
Notice
Unless the dismissal is for just cause then 30 days’ notice should be given (or more if the contract specifies more). Payment may be made in lieu of notice if specified in the contract and this is common practice in China.
Severance Pay
This depends on length of service and is paid at the rate of 1 month’s average wage per year of service, rounded up to the nearest half year. Average salary is the average paid over the preceding year. The total amount paid is capped at 12 months’ salary and also at triple the average compensation for the area.
Under Chinese law if the termination does not have a justifiable cause then the severance is 2 months’ of average salary per year (or part thereof).
However, it is common for employers to pay more than the minimum amount in order to secure a mutual agreement to termination and avoid litigation.
Severance pay is payable at the end of fixed term contracts and it is important to formally terminate such contracts and ensure the employee does not continue to work or the relationship is legally considered to continue.
During Probation
Termination during probation should follow the usual Chinese rules for terminations though an employee can be terminated if it can be demonstrated that they cannot meet the recruitment requirements for the post. An employee can resign with 3 days’ notice during probation.
Annual Leave 2025
New Year’s Day – 1st January
Day off in Lieu: No
Spring Festival Golden Week Holiday (Chinese New Year) – 28th January – 4th February +
Day off in Lieu: No
International Women’s Day* – 8th March (Half Day)
Day off in Lieu: No
Qing Min Jie Holiday – 4th – 6th April +
Day off in Lieu: No
Labour Day Holiday – 1st – 5th May +
Day off in Lieu: No
Dragon Boat Festival – 31st May – 2nd June
Day off in Lieu: No
National Day- 1st October
Day off in Lieu: No
National Day Golden Week Holiday – 2nd – 8th October +
Day off in Lieu: No
*Not mandatory but commonly given for women only
It is common to give more days on those holidays marked +
It is also common for employers to allow flexibility and extra time off over the Lunar New Year to avoid peak travel dates.
In China annual leave entitlement is based on the number of years in employment (with all employers) as detailed below. However, it is common for employers to be more generous, especially for professional positions and leave of 20 days is not uncommon.
Work Tenure
Less than 1 year – 0 Days Leave
1-10 years – 5 Days Leave
10-20 years – 10 Days Leave
Over 20 years – 15 Days Leave
Carry over permitted
Carry over is permitted for one year but not beyond this. Employers should ensure that their employees take their holiday else they have to pay 300% of usual salary.
Sick
The length of sick leave and amount of sick pay an employee is entitled to depends on their cumulative working years and the length of service with their current employer. The period can range from 3 to 24 months and is dependent on the region.
Less than 5 years’ service – 3 month’s leave
5 to 10 years – 6 to 9 months’ leave
10 to 15 years – 12 to 18 months
15 to 20 years – 18 months
More than 20 years – 24 months
For sick leave of less than 6 months, pay entitlement is:
Less than 2 years’ service – 60% of salary
2 to 4 years – 70%
4 to 6 years – 80%
Over 8 years – 100%
For sick leave over 6 months rates of pay are:
Less than 1 year’s service – 40%
1 to 3 years – 50%
Over 3 years – 60%
Maternity
New mothers in China are entitled to at least 98 days of paid maternity leave, including 15 days that can be taken before delivery. Many regions extend this leave significantly. For example, Beijing and Shanghai offer a total of 158 days, while Guangdong provides 178 days.
Maternity leave includes a maternity allowance paid by the government and which varies by region. Additionally, new mothers receive up to one hour of paid breastfeeding leave per workday for up to a year or the mother can apply to the employer for leave of up to 195 days which is compensated by the government via an allowance.
Additionally pregnant employees are entitled to leave for antenatal examinations, 15 extra days in cases of a difficult delivery, a natural delivery and for twins, 15 days for an abortion or a miscarriage in the first 4 months and 42 days if this happens thereafter.
Female workers are protected from dismissal whilst pregnant and for a year after the birth.
Paternity
New fathers can be entitled to 7 to 30 days’ paternity leave depending on the region.
Parental
Parental leave entitlement varies by region and typically ranges from 5 to 15 days.
Other
Other leave is dependent on the contract and the region; 3 to 10 days of paid leave is given for marriage and up to 3 days’ leave for death of an immediate family member.
Medical Insurance
This is often provided to employees, and sometimes their dependents, by leading and especially foreign employers in the large cities. Elsewhere it is uncommon.
Life Insurance
Elements of life insurance are provided under the social security system, however some employers will offer this as a benefit.
Pensions
This is not a usual benefit in China but is provided under the government’s social insurance.
Other
Some companies will offer other benefits such as phone allowance or meal vouchers.
We make expansion in China simple
Employing people compliantly across international borders can be challenging but we make it simple, bringing down barriers and making light work of the complexities. We offer the full range of compliant global expansion solutions so that wherever, whenever and however you want to employ people, we can support you.
EOR Services
Employ people compliantly in 180+ countries – without setting up new entities. We’ll shoulder responsibility as Employer of Record (EOR), making sure all your international employment is fully compliant.
We can also take care of your global HR from multi-country payroll to onboarding and offboarding.
Payroll Solutions
Getting global payroll right is one of the hardest challenges for any business expanding into new countries. We can shoulder this burden, freeing up valuable in-house resource to focus on growing your business.
Consider us an extension of your HR team, ready to answer all your questions large and small.
Global Mobility
Mobilise your people across borders with ease. Relocating to work abroad can feel daunting. But with Leap29 at your side, your employees can feel safe and supported.
We’ll guide your employees through the complexities of working in another country, helping them settle in fast.
Entity Services
Follow the opportunities to grow your business – wherever they take you.
We lighten the load of establishing and managing foreign entities and can help you solve all your entity challenges from running compliant, accurate multi-country payroll to local accounting and financial reporting.
PEO Solutions
Employ international talent wherever and whenever you need it – and enjoy the peace of mind of knowing you’re fully compliant. Our Professional Employer Organisation (PEO) services allow you to focus on growing your business while we handle compliance, multi-country payroll and your global HR.
Support & Advisory
The help you need to make your global growth effortless – trusted guidance and advice on your expansion challenges large and small.
HR Support
When you’re employing people in lots of different countries, answering just a simple query can take a disproportionate amount of time for your in-house HR team. Our HR Support service reduces this burden, saving you time and money and giving you the confidence of knowing your employees are well looked after, whatever their location.
Contractor Payroll
Enjoy compliant contractor payroll that meets all local requirements for tax, social security and employment legislation. We understand the importance of compliant contractor payroll to the success of your business and will pay your contractors on time, every time.
Start hiring today – and onboard within hours.
Pricing
Budget confidently with transparent, competitive fees and no hidden costs.
Want us to shoulder employer liability and take care of your global HR through our EOR solution? No problem. Just want global payroll? You can have that too. Pick the solutions that your individual business needs.


We’re a people business with employee management software, not a software business that works in employee management!
At Leap29 we offer access to the latest technology and software to easily and effectively manage your employees from anywhere in the world.
Our bespoke online portal LeapForward helps ensure a smooth onboarding process, manages monthly payroll and easily facilitates additional bonuses and expenses. By streamlining your processes through our online portal, it will help you attract and retain great talent and take the pain out of payroll management.
Integrated fully with our global EOR services, LeapForward comes at no additional cost to you but is guaranteed to save you time and money whilst simplifying your employee management procedures.

Asia
Expansion Resources
Want to learn more about employment and expansion into Asia?
Check out our Asia resource pages below for more information about the employment market in Asia.
Our Recruitment Services
A global recruitment partner you can trust
We solve global recruitment challenges for businesses large and small. Whether you’re building out a new team, expanding into another country or looking for a confidential executive level hire, you can trust us to deliver.
Need 80 contractors in Brazil? Looking for just one very special permanent hire? Want us to take care of your global HR? It’s all in a day’s work at Leap29.
Whatever and wherever your mandate, we can help.
Permanent Recruitment
Connect with great permanent talent to drive your business forward. We help you find both key strategic hires to lead organisational growth and project specialists to deliver on deadlines and budgets.
Workforce Management
Reduce the complexity of managing workers in different countries and save yourself time, energy and money.
Local expertise, global reach
Employ people compliantly in 180+ countries – with or without your own foreign entities. We can help you set up and manage foreign entities – or act as an Employer of Record. We can also help with multi-country payroll and all your HR management. Wherever, whenever and however you want to employ people, we can help.
180+
Talk to an expert today
Whatever stage you’re at in your global expansion journey, we can help.
Contact us today to see how Leap29 can be the trusted partner that supports your global expansion.
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