What is Employer of Record (EOR) in China?

An Employer of Record (EOR) in China assumes the legal responsibilities for employees, enabling your business to hire talent without the need to establish a local legal entity. The EOR becomes the legal employer on record while you maintain day-to-day control over the employee’s work.

What is the cost of hiring in China through an EOR?

The cost of hiring through Employer of Record (EOR) services in China typically ranges from USD 400 to USD 800 per employee per month, depending on the specific services provided, employee profile, and additional support such as visa processing, benefits administration, and HR advisory.

Why choose EOR over direct hiring in China?

Using an Employer of Record (EOR) in China simplifies market entry and expansion by removing the need to set up a local legal entity. An EOR provides localized HR support, manages employment contracts, payroll, tax compliance, and statutory benefits, and ensures alignment with Chinese labor regulations so you can focus on your core business.

Who is an EOR service provider in China?

Several Employer of Record (EOR) service providers operate in China, including AYP. AYP offers comprehensive EOR solutions to help you hire, manage, and pay employees compliantly while ensuring full transparency with no hidden costs, giving you peace of mind when expanding into the Chinese market.

What is the process of hiring EOR employees in China?

AYP’s onboarding process for EOR employees in China typically includes: conducting a thorough analysis of the client’s hiring and compliance requirements; performing a cost simulation for employee hiring; assisting with obtaining necessary work permits where applicable; preparing employment contracts that comply with local regulations; enrolling employees in mandatory and optional benefits programs; and sending a welcome email to new hires to ensure a smooth onboarding experience.

Why choose EOR with direct local support in China?

Choosing an Employer of Record (EOR) in China with direct local support ensures that employment practices align with Chinese labor laws, helping both the client and local employees avoid legal risks and penalties. AYP’s local HR support team can provide faster, on-the-ground responses to employee queries, delivering a seamless employee experience and higher satisfaction for your China-based workforce.

EOR China: Complete 2026 guide for global companies

Tap on diverse talents in the world's second largest economy by hiring compliantly without an entity with EOR in China

Official
currency

CNY (Chinese Yuan)

Official
language

Mandarin Chinese

Public
holidays

7 + adjusted days (2026)

Employer
contributions

~27-30%

4.8

Google Reviews

Introduction EOR Employment landscape Laws & compliance Payroll & tax Working hours & Leave entitlements Work permit & Visas Termination & employee exit Why AYP

Introduction

Employer of Record China enables international companies to access the world's second-largest economy with compliant hiring solutions. This comprehensive guide covers China's provincial minimum wages, social insurance requirements across major cities, and work permit regulations for 2026

Employer of Record (EOR) China 2026

Why companies are expanding into China with EOR in 2026

China's economy remains a global powerhouse, with GDP growth projected at 4.5% for 2026 according to the IMF. Despite challenges from property sector adjustment and trade tensions, China continues to drive approximately 30% of global economic growth.

China's employment regulations are complex, with significant variations across provinces and cities. Social insurance rates, minimum wages, and housing fund requirements differ by location, requiring specialized local expertise for compliance.

What makes China's regulatory environment unique in 2026

Provincial Minimum Wage Variations: China's 31 provinces set independent minimum wages ranging from RMB 1,750 to RMB 2,740/month, with Shanghai, Beijing, and Shenzhen maintaining the highest rates.

City-Specific Social Insurance: Contribution rates and caps vary significantly by city. Beijing employers pay ~27-28% while Guangzhou employers pay ~26-27%, with different calculation bases.

15th Five-Year Plan Impact: China's new plan emphasizes consumption-led growth, innovation, and domestic demand - priorities that may influence future employment policies and incentives.

Employment landscape

Malaysia has solidified its position as Southeast Asia's high-tech manufacturing hub and digital services corridor. The defining theme for 2026 is "High-Value Growth," driven by the New Industrial Master Plan (NIMP) 2030 and the influx of data center investments in Johor and Cyberjaya. Additionally, the Ringgit has stabilized in late 2025/2026 due to strong export recovery, moving away from the historic laws of 2024.

Market overview (2026 projections)

Economic Indicator	2026 Data
GDP	~USD 19 trillion
GDP Growth	4.5% (IMF forecast)
Population	~1.41 billion
Labor Force	~780 million
Urban Unemployment	~5.0%
Currency	CNY ~7.2-7.4 per USD
Inflation	~0.8% (gradual recovery)
Key Industries	Manufacturing, tech, services, EVs, renewables

Laws & compliance

Provincial Minimum Wages (2026)

China does not have a national minimum wage. Each province sets its own rates based on local economic conditions, with tiered classes within provinces. Major updates in January 2026 include Zhejiang, Jiangsu, and Shaanxi.

Province/City	Monthly Min (RMB)	Hourly Min (RMB)
Shanghai	2,740 (highest)	24
Beijing	2,420	27.7 (highest hourly)
Shenzhen	2,520	24.2
Guangdong (Tier 1)	2,360	22.2
Jiangsu (Tier 1)	2,490	24
Zhejiang (Tier 1)	2,490	24
Interior Provinces	1,750-2,200	18-22

Social Insurance (Five Insurances + One Fund)

Insurance Type	Employer Rate	Employee Rate
Pension Insurance	16%	8%
Medical Insurance	~10% (varies)	2% + fixed amount
Unemployment Insurance	0.5-1%	0.5%
Work Injury Insurance	0.2-1.9% (industry-based)	N/A
Maternity Insurance	0.5-1% (often merged with medical)	N/A
Housing Fund	5-12%	5-12%
TOTAL (typical)	~27-35%	~15-20%

_{Note: Social insurance contribution bases have floors (60% of local average wage) and ceilings (300% of local average wage). Foreign employees must participate in all insurances except housing fund in most cities.}

Payroll & tax

City-Specific Employer Costs (Example)

City	Employer Total	Employee Total
Beijing	~27-28%	~10.5%
Shanghai	~26-27%	~10.5%
Shenzhen	~26-28%	~11%
Guangzhou	~25-27%	~10.5%

Individual Income Tax (IIT) Rates

China taxes residents on worldwide income and non-residents on China-sourced income. Tax residents are individuals domiciled in China or present for 183+ days in a tax year.

‍

Annual Taxable Income (CNY)	Tax Rate
Up to 36,000	3%
36,001 - 144,000	10%
144,001 - 300,000	20%
300,001 - 420,000	25%
420,001 - 660,000	30%
660,001 - 960,000	35%
Above 960,000	45%

_{Standard deduction: CNY 5,000/month. Additional deductions available for children's education, continuing education, housing loan interest, housing rent, elderly care, and infant care.}

Working hours & Leave entitlements

Working Hours Regulations

Regulation	Requirement
Standard Hours	8 hours/day, 40 hours/week
Overtime Cap	36 hours/month maximum
Regular Overtime	150% of hourly wage
Rest Day Overtime	200% of hourly wage (or compensatory rest)
Public Holiday Overtime	300% of hourly wage

Leave entitlements

Leave Type	Entitlement	Notes
Annual Leave	5-15 days based on total service	1-10 yrs: 5 days; 10-20 yrs: 10 days; 20+ yrs: 15 days
Sick Leave	Per company policy & local rules	60-100% salary depending on tenure
Maternity Leave	98 days (national); 128-190 days (provincial)	Beijing/Shanghai: 158 days; paid via maternity insurance
Paternity Leave	7-30 days (varies by province)	Paid by employer
Parental Leave (NEW)	5-15 days/year (varies by province)	For children under 3; full pay in most regions
Marriage Leave	3 days (national)	Some provinces add additional days
Bereavement Leave	1-3 days	For immediate family
Public Holidays	7 holidays (11+ actual days)	Includes make-up work days

Work permits & Visas

Foreign workers in China require a Work Permit and Z Visa (or R Visa for high-level talent). The unified work permit system categorizes foreign workers into Type A (high-level), Type B (professional), and Type C (entry-level/temporary).

Work permit categories

Category	Description	Validity
Type A (High-level)	Top talents, urgently needed specialists, high earners (60k+ salary)	Up to 5 years
Type B (Professional)	Bachelor's degree + 2 years experience; most common category	Up to 2 years
Type C (Other)	Temporary, seasonal, or entry-level workers	Up to 1 year
Z Visa	Standard work visa; requires Work Permit Notice	30 days (convert to residence permit)
R Visa	For recognized high-level talent	Up to 5 years

Key Requirements: Degree authentication, criminal background check, health examination, Work Permit Notification Letter from employer. Processing: ~15-30 working days total. Foreigners from 11 countries with bilateral agreements may be exempt from certain social insurance requirements.

Employer of Record

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Onboard in minutes, stay compliant - let AYP handle the rest

Termination & Employee exit

Notice period requirements

Termination Type	Notice Requirement
Employee resignation	30 days written notice
During probation (employee)	3 days notice
Employer termination (without cause)	30 days notice OR 1 month salary in lieu
Summary dismissal (with cause)	No notice required (must document misconduct)

Severance pay

Statutory severance is required for most terminations except summary dismissal for cause or employee resignation. The formula is: 1 month's average salary × years of service. Partial years over 6 months round up; under 6 months = 0.5 month.

Cap applies when employee's average monthly salary exceeds 3x local average: severance calculated at 3x local average, maximum 12 months. Unlawful termination = 2x statutory severance (N compensation becomes 2N).

Protected categories

Employees cannot be terminated without cause if: pregnant or on maternity leave/nursing; on medical leave; within 5 years of statutory retirement age with 15+ years service; suffering from occupational disease or work injury.

Why AYP

AYP Group provides comprehensive EOR services in China, combining deep understanding of the Labor Contract Law, Social Insurance Law, and provincial regulations with technology-driven compliance solutions.

Capability	AYP Group Advantage
Multi-City Compliance	Expert management of city-specific social insurance rates, contribution bases, and housing fund requirements across Beijing, Shanghai, Shenzhen, Guangzhou, and other major cities.
Provincial Minimum Wages	Accurate application of China's complex provincial minimum wage system with tiered classes within each province.
Work Permit Processing	End-to-end work permit management including Type A/B/C classification, Z Visa applications, and residence permit conversion.
Foreign Employee SI	Navigation of bilateral social security agreements and exemptions for eligible foreign nationals from treaty countries.
Local Entity	Direct presence in China through our own licensed entity. Not an aggregator - we employ your staff directly.

Get started

China remains the world's manufacturing powerhouse and an essential market for global businesses. With complex provincial regulations and city-specific requirements, AYP Group's EOR services eliminate compliance complexity while ensuring your operations meet all legal requirements. ‍

Ready to hire in China? Contact AYP Group today to discover how our local expertise and transparent pricing can accelerate your expansion into the world's second-largest economy.

_{Legal Disclaimer: This guide provides general information about China employment regulations and EOR services. Specific legal advice should be obtained from qualified professionals. Employment laws and regulations are subject to change and vary by province.}

‍

Employer of Record

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Our technology handles onboarding, payroll, and compliance automatically, so your team can focus on growth

Questions?
We're here to help

AYP’s pricing covers the end-to-end employment lifecycle for your employees in each country.

This includes payroll processing, statutory filings, compliance monitoring, local employment administration, and ongoing HR support. Our goal is to ensure your workforce is managed compliantly and smoothly, without you having to coordinate multiple vendors.

Before you start, we provide a clear breakdown of what is covered, so you know exactly what to expect.

We believe regional workforce management should be predictable, not full of surprises.

That’s why we walk you through a detailed cost breakdown before onboarding begins. This includes employer costs, statutory contributions, and service fees. If any scope changes arise, they are discussed with you in advance, so you stay in control of your budget.

In some countries, a security deposit is required as part of responsible employment and payroll risk management.

This deposit is typically aligned with local notice period obligations and helps ensure that final salary, statutory payments, and any end of employment costs are properly covered. The deposit remains in your company’s funds and is returned according to the agreed terms when employment ends.

Your AYP advisor will explain clearly if this applies in your chosen countries.

AYP charges a fixed monthly service fee per employee, rather than a percentage of salary.

This makes your costs more predictable and easier to plan across countries. Pricing is structured based on country requirements, workforce size, and the level of support needed. There is no long term lock in. We work with you based on your current workforce needs.

AYP combines in-country expertise with structured support across Asia.

Instead of routing requests through a general support system, you work with teams who understand local regulations and your workforce setup. We focus not only on payroll processing, but also on proactive compliance updates and practical HR advisory, so you can make informed decisions with confidence.