China’s overtime rules can be quite complicated.
For example, workers under standard labour contracts receive double pay for weekend work, while those under different kinds of contracts may not qualify for this overtime rate. This difference comes down to the “work hour systems” they are contracted under.
So, what exactly are these “work hour systems?”
They define how many hours employees are expected to work, their rest periods, and how overtime is calculated. In China, there are three distinct “work hour systems,” and which one your employees fall under determines everything about overtime — from how it’s calculated to what you need to pay.
Here’s a Quick Overview
- Standard Work Hour System: This is the most common system, where employees typically work 8 hours a day and 40 hours a week. Overtime is paid at different rates depending on when the extra hours are worked.
- Comprehensive Work Hour System: This system averages work hours over a longer period — like weeks or months. Employees can work longer hours during busy times, but if they exceed the average limit, overtime rates apply.
- Flexible Work Hour System: This system allows for no fixed working hours, ideal for roles where performance is measured by results rather than time spent working.
| Work Hour System | Typical Hours | Overtime Pay |
| Standard Work Hour System | 8 hours/day, 40 hours/week | Weekday: 150% Weekend: 200% Public Holiday: 300% |
| Comprehensive Work Hour System | Averages over weeks/months/quarters | Exceeding Limit: 150% Public Holiday: 300% |
| Flexible Work Hour System | No fixed hours | Regular Days: Normal salary Weekends: Normal salary Public Holiday: 300% |
Option 1: Standard Work System (The Default)
The Standard Work Hour System is the default for workers in China, and it’s pretty straightforward. Here’s what you need to know:
- Typical Hours: Employees work 8 hours a day and 40 hours a week.
- Overtime: Anything beyond that is considered overtime.
Here’s how the pay breaks down:
| Type of Overtime | Payment Required |
| Weekday Overtime | 150% of normal wage |
| Weekend Work | 200% of normal wage |
| Public Holiday Work | 300% of normal wage |
Is There a Limit to Overtime?
Yes! Under the Standard Work Hour System, you can’t exceed:
- 3 hours of overtime per day
- 36 hours of overtime per month
Option 2: Comprehensive Work System (The Flexible Friend)
Instead of counting hours daily, this system averages work hours over an extended period – weekly, monthly, quarterly or yearly.
Here’s a simple example:
Let’s say you’re using a monthly period:
- Some days might be 10 hours
- Others might be 6 hours
- However, as long as the monthly average works out right, no overtime is due
- Go over the monthly total? That’s when overtime kicks in.
The overtime rate is pretty much the same as the standard work system, but omits extra pay for weekends:
| Work Type | Payment Required |
| Hours exceeding period limit | 150% of normal wage |
| Public holidays | 300% of normal wage |
However, there’s three “no’s” to remember:
- No Working More Than 11 Hours in One Day: Employees cannot exceed this limit, regardless of the work hour system.
- No Skipping Days Off: Every employee must have at least one day off per week to ensure adequate rest.
- No System Without Approval: You need government approval to implement a Comprehensive Work Hour System.
- No Agreement Without a Contract: The comprehensive working arrangement must be clearly included in the labour contract signed by both the employee and employer.
Who Can Use It?
- Transport, telecoms, aviation and fishing industries
- Seasonal work like construction, tourism, or resource exploration
- Similar roles approved by the government
Option 3: The Flexible Work Hour System
If you’re looking for a way to manage hours without the constraints of standard timekeeping, the Flexible Work Hour System might be your best bet. This system is all about focusing on getting the job done rather than clock-watching.
Who Can Use It?
This system is designed for three main categories of employees:
- Senior Managers and Salespeople: Roles where performance is measured by results, not hours.
- Transportation Workers: This includes taxi drivers and long-distance transport staff who often work irregular hours.
- Other Roles: Any job where fixed hours simply don’t fit the nature of the work.
How Pay Works
Under the Flexible Work Hour System, your employees won’t earn extra pay for regular workdays or weekends, but they will be compensated at a generous 300% for public holidays, in most regions.
| Work Type | Payment Required |
| Regular workdays | Normal salary (no overtime) |
| Weekends | Normal salary (no overtime) |
| Public holidays | 300% of normal wage (But only in some regions*) |
You’re probably curious about that last point. The requirement to pay overtime on public holidays under the Flexible Work Hour System varies by region. For example, in Shanghai, employees must be paid 300% for overtime, while in Beijing, they aren’t entitled to public holiday overtime.
While the Flexible Work Hour System offers great flexibility, you cannot just start using it:
- Approval Required: You likely must obtain approval from your local labour administration department before implementing this system.
- Include in Labor Contracts: The flexible working arrangement needs to be clearly outlined in each employee’s labour contract.
Managing China’s Overtime Rules
To minimize legal risks related to China’s overtime rules:
- Include specific overtime clauses in employment contracts
- Obtain approval from local labour authorities for alternative work hour systems
- Document all overtime arrangements and payments
