Multiplier’s is the world’s leading Professional Employer Organization and is the PEO of choice when employing talent internationally, across different jurisdictions. Our SaaS-based PEO solution helps you offload all global HR tasks – payrolling, benefits, compliance, employment risks – to us. As we take care of the non-revenue activities and nullify the employment risks, confidently take the plunge to boost revenue, growth, market presence, etc. . In short, we lift the load of international HR, payrolling, benefits off your shoulders, and help you build an organization with highly satisfied, well-looked-after employees.
What is a PEO?
A Professional Employer Organization (PEO) acts as a co-employer and helps businesses to outsource some of their HR functions – onboarding, payroll, benefits, employee management – and streamline them in order to offer better employee management experience.
Companies use PEOs to offload their non-revenue generating HR operations and better focus on growth and revenue. Additionally, companies vying to establish operations in a foreign country partner with PEOs to navigate through compliantly employ, payroll and offer benefits to local staff.
Multiplier’s PEO solution automates these activities for employers to manage global HR operations in one click.
Doing business with a China PEO
China is one of the biggest contributors to the world’s economy. In fact, it is the growth of markets such as China and similar Asian countries have led countries that are looking for growth opportunities up and about. China is currently the second-biggest economy in the world, with a GDP of a mammoth $12.24 trillion.
Since the great economic slowdown of 2008, China has steadily surged as the largest contributor to global growth. China complemented this growth by offering highly skilled workers to fuel the growth; China has one of the highest numbers of skilled workers in the world at over 200 million.
Although China ranks high (31) in the global ease of doing business index, it is no news that China has often had a history of mixing business with politics, making it difficult for firms to freely do business in the country. However, firms continue to invest in the country owing to the mammoth market size.
Being the diverse and affluent market that it is, China seems to have a higher rate of product-market fit for many businesses. Thus, firms find it still profitable to expand into the country.
China may seem to be a difficult country to expand your business to but it is not entirely true. If you have the right global HR and operations experts onboard, hiring and expanding into China need not be as scary as it sounds. Multiplier’s PEO solution helps you offload HR and payroll operations to us along with the local employment risks associated with them.
Why use a China PEO
A China PEO can completely eliminate the employment risks associated with hiring and expanding into China. Setting up an entity in China can take a long time as you plow through wave after wave of regulations. Particularly, handling payroll in China is painful as the laws vary from city to city.
Multiplier’s China PEO can enable you to hire, manage, pay, terminate contracts without setting up a dedicated infrastructure in China. Besides, setting up teams to handle HR operations in China and establishing a local entity can take several months. Using our China PEO, you can also enter into new markets without a foreign entity in under a day.
China PEO Costs
Usually, PEOs charge based on two pricing models – fixed and variable. A PEO based on the fixed pricing model charges a transparent fee ranging between $200 – $1000 per employee per month.
Multiplier is one such PEO solution. Our costs for our China PEO are fixed. The final cost depends on the complexity of employment laws of the employee’s jurisdiction.
Our prices are designed to ensure that you get the most out of your employee spending. Every employee hired through our PEO also receives HR support, benefits management, and a live dashboard to track workforce spending in real-time.
How to hire in China
One of the main reasons a China PEO may be thought-worthy is because hiring talent in China is still financially viable. Despite rising wages, China is still home to affordable talent. Moreover, 26% of China’s workforce belongs to the highly skilled category. Thus hiring in China, despite the complications, is still lucrative.
Before beginning your recruitment drive in China, you must know a few things to stay compliant. Firstly, Chinese workers consider employment contractors as the start-all, be-all, and end-all. They expect a clear, non-ambiguous contract to be presented by the empower within 30 days of employment – violating which, the employee is entitled to receive twice their salary until receiving their contract.
You should also be aware of an annual bonus your employee is entitled to – referred to as the 13th-month salary.
Do you have the experts on your ship to navigate these compliance issues? Partnering with a China PEO keeps your business safe from violating these labor laws. Our local experts are fully aware of local laws and regulations and thus enable you to onboard local talent without any mistakes.
However, if you want to play this game alone, here are a few tips you’d like to take home.
As mentioned before, employees in China pay keen attention to detail with regard to employment contracts. You have to be clear and unambiguous. Employment contracts should contain detailed information on working hours, salary breakdown, benefits, probation, termination clauses, etc.
Probation periods must be agreed upon by both parties. The maximum period of probation
Income tax in China is progressive.
Refer to the following table to learn about the tax slabs for individuals’ income:
Generally, offices in China are open between 8 am to 6 pm. Employees cannot be tasked for more than 44 hours spread over a 5-day workweek.
It is not mandatory for the employer to provide health benefits. Employees are covered by a basic health and pension plan by the state.
Employers can still go the distance to offer supplementary benefits. Partnering with a China PEO can help you find and offer the best benefits in the market.
Paid leaves & Vacation
The terms around vacation or leaves in China can be different from other countries.
The paid holiday schedule in China is as follows:
- New Year’s Day: Jan. 1-2
- Spring Festival: 3 days, usually between late January and mid-February
- Tomb Sweeping Day: 1 day, usually either April 4, 5 or 6
- International Labor Day: May 1
- Dragon Boat Festival: 1 day, usually in May or June
- Mid-Autumn Festival: 1 day, usually between mid-September and mid-October
- National Day: 3 days in early October
Employees who have worked:
- Less than one year receive no vacation
- Between one year and less than 10 years are entitled to 5 days of paid annual leave.
- At least 10 years but less than 20 years are entitled to 10 days of annual leave.
- At least 20 years of work entitles employees to 15 days of annual leave
In practice, most foreign employers hiring mid-level to senior executives in China will provide 2-4 weeks of annual vacation days.
Employers can require employees to take their entire annual leave entitlement each year. If an employee does not use all of his or her annual leave in a certain year, and does not agree to carry the leave forward, then the employer must pay the employee 200% of the employee’s average daily wage for each day of unused annual leave, in addition to regular salary.
Sick leaves usually vary with the employer. Under non-work-related illness or injury, the length of the sick leave varies with the number of years employed with the current employer.
In cases of medical treatment, employees are entitled to 3-24 months of medical leave.
Women are entitled to 98 days of paid maternity leave. Employees can avail of this 15 days before their childbirth.
In instances of additional birth, employees are entitled to 15 more days.
Paternity leave usually is not granted for more than 14 days. However, this entitlement may vary from city to city.
Termination of employment
Causes of termination must be clearly documented.
The amount of notice required varies with the length of service. Employees who have served a company anywhere between 1 month to 2 years must give a minimum of one week’s notice. Employees serving an employer for more than 2 years are required to offer one week’s notice for every year served.
With Multiplier’s PEO/EOR solution, treading into a new market is seamless
Without the hassle of setting up a foreign branch or subsidiary, we can help you onboard your preferred candidate, handle HR issues and payroll, and ensure compliance with local laws.
Once you have chosen your desired talent, start generating and customizing employment contracts for them in a few clicks and manage the workforce from a single platform. You can also pay thousands of employees in Chinese Yuan with a single click.
Hire and expand into Singapore using the best SaaS-based PEO service in China. Contact us to grow your business today.