Found your perfect hire in China? Congratulations! Now, it’s time to make it official.
At Kinyu, we’ve successfully onboarded many employees for our clients. In this blog, we’re sharing our tried-and-true six-step process that covers everything from offer acceptance to day one with your new employee.
Here’s the roadmap:
- Extend offer and negotiate salary
- Gather essential documents
- Conduct background checks
- Sign employment contract
- Register for social insurance
- Prepare for day one
Let’s break down each step to ensure a smooth (and compliant!) onboarding process.
1. Offer Letter and Negotiate the Salary
First things first, send out that offer letter and negotiate the salary. In China, keep these points in mind:
- Clearly state if the salary is pre-tax or post-tax to avoid misunderstandings.
- Remember that the “13th month” bonus is often expected in China, even if not legally required.
- Be aware that some benefits, like housing allowances, are taxed differently in China.
- It’s always best to call the candidate first and share the offer on the phone before preparing the formal offer letter. This way, you can get their verbal acceptance before preparing the detailed document.
2. Document Preparation: Get Your Ducks in a Row
Gather all necessary documents as soon as possible. You’ll need them throughout the onboarding process, so it’s best to have them ready from the get-go.
From Your New Hire (Must-Haves):
- ID card (original and copy): The Chinese national identity card, which includes personal information and a unique identification number.
- Hukou (household registration) – original and copy: A record officially identifying a person as a resident of a certain area, which can affect access to local services.
- Bank card details (original card and copy): Information for the account where the employee’s salary will be deposited.
- Recent 1-inch headshot photo with white background (physical and digital versions): Used for employee ID cards and other official documents.
From the New Hire (If Applicable):
- Education certificates (original and copy, if applicable): Diplomas or degree certificates proving the employee’s educational qualifications.
- Health check results (original): Recent medical examination results, often required by Chinese employers to ensure the employee’s fitness for work.
- Employment certification (original and copy, if applicable): Documents from previous employers verifying work history and experience. This is usually in the form of a 离职证明 (employment termination certificate) from the previous employer.
- Contact information for two professional references: Names, positions, and contact details of individuals who can vouch for the employee’s professional capabilities.
While the new hire is sorting their documents, ensure your HR team is preparing the necessary paperwork from your end. Here’s what you’ll typically need:
From Your HR Team (Must-Haves):
- Employment agreement: A legally binding contract outlining the terms and conditions of employment.
- Employee handbook: A comprehensive guide detailing company policies, procedures, and expectations.
- Employee personal information form: A document for collecting detailed personal and professional information about the new hire.
- Equipment handover form: A list of company property provided to the employee, which they are responsible for maintaining.
- Reference Check Authorization form: This is a document where the employee inputs the referees and agrees to allow the employer to carry out a background check on work experience and education.
From Your HR Team (If Applicable):
- Employee handbook confirmation: A signed acknowledgment that the employee has received and understood the company handbook.
- Car rental agreement (if applicable): Terms and conditions for company-provided vehicles, if part of the employee’s benefits package.
3. Conduct Background Checks
Before initiating any background or reference checks, it’s crucial to obtain written consent from your potential hire. This is not just a best practice; it’s often a legal requirement. Once you have this consent, you can proceed with the necessary checks.
In China, background checks require a delicate balance between due diligence and legal compliance with the country’s robust data protection laws.
Remember: When it comes to background checks in China, less is definitely more. Keep it simple, keep it relevant, and keep it legal!
Warning: Two Big No’s for Background Checks!
Don’t go digging where you shouldn’t!
Stick to job-relevant checks only. It’s strictly prohibited to inquire about personal beliefs, family status, or protected characteristics such as disability or sexual orientation.
Remember: Overstepping can lead to lawsuits. Keep checks relevant and legal.
No sharing is caring here!
It’s illegal in China to sell or give away someone’s personal information. Employers need to be cautious about sharing background check results, particularly with overseas parent companies or subsidiaries. The safest approach is to only communicate whether the candidate passed or failed the check, without providing specifics. If you absolutely must share more, get a legal expert on board first.
Typical Background Checks in China:
Most employers in China will require the following checks to be completed for new hires:
| Type of Check | Description |
|---|---|
| Reference Checks | Contacting previous employers or provided references for insights on work performance |
| Employment History | Verification of past job roles, dates of employment, and reasons for leaving |
| Education Verification | Confirmation of degrees, diplomas, and certifications with educational institutions |
Important Notes:
- In China, it’s normal to skip criminal record checks unless absolutely necessary (like for teaching roles). If needed, the candidate must obtain a Certificate of No Criminal Conviction (CNCC) themselves.
- While social media checks, fingerprinting, and drug tests are technically allowed, they’re rarely used – less than 1% of cases. Only consider these for ultra-sensitive positions.
Remember: Unnecessary checks can be a waste of time and money, and might even land you in hot water legally. Keep it simple and relevant.
4. Sign the Contract
Once the background checks are completed, it’s time to sign the contract. You can sign a contract within 30 days of the employee’s start date, but most employers either do it before or on the start date.
- Legal Requirement: You must sign a contract within 30 days of the employee’s start date.
- Best Practice: Sign on or before the first day of work.
- Warning: Failing to sign within 30 days can result in severe penalties, including double salary payments.
Tip: Align your contract signing with social insurance registration. It’s efficient and ensures you’re covering all legal bases from the start.
5. Register Your New Hire with Social Insurance
Next, you need to register the employee on China’s social insurance system. Social insurance in China is a mandatory system that provides basic welfare coverage for employees. It consists of five main components:
- Pension insurance
- Medical insurance
- Unemployment insurance
- Work-related injury insurance
- Maternity insurance
Additionally, there’s a housing fund that’s often grouped with these insurances.
As with the employment contract, you must register new employees for social insurance within 30 days of their start date. Here’s what you need to do:
- Register with the local Social Insurance Bureau
- Sign agreements with relevant social insurance bodies
- Calculate correct contribution amounts based on salary, location, and types of insurance
- Register with the local Housing Fund Bureau if applicable
- Keep accurate records for compliance
Important: Is Your Bank Account Social Insurance Compatible?
CRUCIAL: If you have an entity in China, you will also have a business bank account. However, before you hire in China, you MUST make sure your bank account is compatible with the social insurance system. Not all are!
Remember:
- Opening a Chinese bank account can take several weeks.
- You need this account ready before your employee’s start date.
- It’s essential for meeting the 30-day social insurance registration deadline.
Therefore, verify social insurance compatibility with your bank explicitly before you begin the hiring process.
6. Onboarding Day: China-Specific Considerations
The big day has arrived! Your new hire’s first day is a crucial opportunity to make a great impression and set them up for success. While your company will have its own onboarding processes, here are some key considerations when onboarding Chinese hires:
- Go through the employee handbook: Carefully review the company handbook, ensuring the new hire understands all policies, procedures, and expectations. Pay special attention to areas that might differ from typical Chinese workplace norms.
- International communication: Offer guidance on communicating effectively with international colleagues, including any specific tools or platforms your company uses.
- Equipment Handover: Make sure the equipment is ready with all relevant software installed, such as Office 365, Slack, VPN, etc.
- Introductory calls: Set up calls with your wider team and prepare company materials to read.
Remember, the goal is to help your new Chinese employees integrate smoothly into your company’s global culture while leveraging their local expertise. This balanced approach will set both the employee and your company up for success in the Chinese market.
Need Expert Help with Onboarding in China?
We specialise in providing our clients with hiring, onboarding and managing the perfect hires in China. With our established processes and comprehensive documentation expertise, we ensure full compliance with local regulations and smooth onboarding procedures.
Contact us today for a complete overview of our documentation requirements and let us handle the complexity whilst you focus on your business goals.
