China Payroll
Updated Salary Package in China 2022

Updated Salary Package in China 2022

Wages in China are a major concern and draw for many foreign nationals and foreign businesses. Whether your company is already active in China or is just getting started, labor costs will be a significant part of many expenditures, and understanding Chinese labor laws and the current state of the market in 2022 and beyond is highly recommended.

Chinese employment and labor law

Since opening up the economy in the 1980s, China has enacted a slew of new laws and economic policies. Currently, employment and labor are governed by two major legal frameworks. The Labor Law of 1995 and the Labor Contract Law of 2008 (as amended in 2012) (also known as “Employment Contract Law”). These laws define the basic requirements for employment, contracts, termination, wage payment, and so on.

Some of the main areas these laws describe include:

  • All employees must have a contract with their employer that specifies the nature and location of their work, contract terms, salary, hours, leave, and other entitlements.
  • A standard workweek of 40 hours, with overtime restrictions and higher pay rates;
  • Wages must be paid on time; they may not be delayed.
  • Statutory holidays, marriage, and funeral leave should all be compensated with pay.
  • Contract termination rules, including severance pay levels, are defined.

China’s labor market is not without difficulties.

The new laws enacted in 2008 resulted in an increase in the number of businesses looking to offer contracts or flexible work to avoid some of the new requirements. The government has made efforts to control this, but in difficult labor markets, many employees are forced to accept unsatisfactory temporary arrangements.

In response to such challenges, the Interim Provision on Labor Dispatch (2012) and the Labor Contract Law amendments of 2014 were enacted in an attempt to protect and manage temporary workers.

There are still challenges for both employees and employers, but China is striving toward fair employment laws; between worker protections and a competitive business environment for employers, which are supported by two main vehicles for hiring staff in China, employment solutions and company formation.

Foreigner Wages in China

Excluding expats on lavish packages, these are foreigners who chose to come to or stay in China for work opportunities. Because of a lack of data across China, our foreigner salary table only includes popular jobs among foreigners in the T1 cities: Shanghai, Beijing, Shenzhen, and Guangzhou.

Expat Wages in China

It is much more difficult to provide an “average” salary for expat workers in China. Expats working in China are foreigners who have been sent to China by their employers for work. Expat salaries vary greatly depending on skillset, experience, and language abilities. We’ve got some thoughts on the market and wages for expats in China here:

Over the last decade, the market has changed as the skills and experience of local Chinese graduates have increased. Many of the mid-level positions that used to be filled by expats can now be filled at a lower cost and more effectively by local employees.

Expats are still frequently hired by both domestic and foreign companies for more senior or skill-specific roles.

Expat salaries tend to rise with experience, but also with work experience in China and the ability to communicate in Mandarin Chinese.

Salaries are frequently much higher for an expat moving from another country than for an expat hired locally in China.

Benefits and total salary packages must be considered, as these are frequently far more comprehensive than what a local employee would receive. If offered, expat health insurance, housing allowances, and possible inclusion for family living, insurance, and education can be very expensive.

It should be noted that certain benefits (including housing) are exempt from Income Tax. For more information, please see our separate article.

Referring to actual expat salaries, announced that expats will no longer be eligible for tax breaks on expenses in December 2023. A major source of tax breaks previously granted to foreign nationals on the grounds that they did not benefit as much from Chinese social funds.

Other general data on foreigner wages in China:

Salary ranges for English teachers in China range from about 19k to 28k US dollars, while salaries for front office/account senior manager roles in sales, marketing, or communications range from 32k to 44k US dollars.

An HR Manager with 6+ years of experience earns a salary of $50,000 US, while a similar experience in sales/marketing earns a salary of $38,000 to $80,000 US.

CFO roles can earn up to 240k US dollars, an experienced lawyer 205k US dollars, and a Managing Director in Sales / Marketing 315k US dollars.

Companies should also be aware that expat wages in China are among the highest in Asia. According to a region-wide survey conducted by ECA International in May 2018, total expat salary packages for the mid-manager level in China were the third-highest (after Japan and India), at close to US$280,000. This is an interesting decrease from the levels stated in 2016 and 2017 (when China was second highest).

If you need and detailed information of foreign employment or payroll inquiry, please contact us for a free quote.

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