Labor Force Management

Last updated: Jan 2021
The HR Regulations Guide for Foreign Companies in China

China has many labor laws and labor rights, which are enforced by the government. The general national labor laws are periodically adjusted by the Chinese government, and are complemented by long lists of provincial laws and supplementary regulations.

PTL Group’s vast expertise includes employment services in China. We want to share our important knowledge with you. The following article discusses labor force management.

Read more about PTL Group’s employment services in China.

Labor Force Management

The importance of a manager

For thousands of years, China has been governed by a central “top-down” leader. The importance and centrality of the manager in China is not only the result of historical processes, but also a cultural philosophy. For that reason, Chinese employees seek a single, powerful, authoritative and responsible manager, whom they can look up to. They might even feel uncomfortable in his or her absence.

As part of the status prestige, workers will not challenge the manager’s authority; will not doubt his or her decisions; will not undermine him or her; and will show respect and submission. When a manager is caught in a moment of weakness (i.e. looks hesitant or says “I don’t know”), he or she immediately “loses face”.

This culture is of particular importance when it comes to HR management. HR managers are expected to act as leaders with authority. Employees expect their HR manager to provide them with information, to inspire composure and set the tone throughout unexpected events or unusual times.

Therefore, the HR team should be present and active for the employees. They should be able to craft and carry out strategic plans, while orchestrating stable and efficient business operations under a wide variety of circumstances.

The employee handbook

Many companies in China tend to rely only on the labor contract to define the terms of employment. But most often this piece of legal document is not enough to cover all the key provisions that are important for the employer to implement. This is where the employee handbook becomes relevant.

The goal of the employee handbook is to add another layer of protection for the company in the event of a labor dispute. As it defines supplemental rules that are relevant to the company, it should prevent cases of black areas and vagueness.

Some of the topics that are usually covered in the employee handbook are:

  • Code of conduct
  • Workplace security rules
  • KPIs
  • Info about extra hours, paid leaves and promotions
  • Attendance management

Foreign managers in China must remember that even if the employee handbook is available in both Chinese and English, the Chinese one is always the binding one. Hence it is crucial to avoid translation discrepancies.

In order to formulate an effective employee handbook, it has to be specific and clear, so it leaves no room for doubt. For instance, be clear whether you mean “two days” or “two working days”. Also, provide an explanation of your rules in order to demonstrate “what happens if” and to back it up.

Last but not least – have all employees sign the employment book, also when some clauses of it are updated. That will ensure the employee handbook is valid and binding. Past experience shows that companies that went into arbitration with employees and had a signed employee handbook used it for their favor to support their arguments.

Last updated: January 2021

Regulations in China change frequently, but you don’t have to go there all alone. Get in touch today and let us support your China operations.