The single most important thing to check in a Chinese work contract is that the Chinese-language version is professionally translated and perfectly matches the English one. Under Chinese employment contract law, the Chinese version is the legally binding document in any dispute, regardless of what your English copy says. Verbal promises mean nothing if they aren’t written into that specific document. Many work contract red flags for foreigners stem from discrepancies between the two versions, so investing in an independent translation is non-negotiable before you sign anything.
The Probation Period (试用期)
China’s labor laws strictly regulate the probation period (试用期, shìyòngqī). Its maximum length is tied to your contract term: one month for contracts under a year, two months for contracts of 1-3 years, and a maximum of six months for contracts longer than three years. During this time, your salary can be legally reduced, but it cannot be less than 80% of the agreed-upon full salary or the company’s minimum wage for the same position, whichever is higher. A red flag is a contract that proposes a long probation period on a short-term contract or a salary below the 80% threshold. Also, a company cannot put you on a second probation period after a renewal.
Salary, Benefits, and Reimbursement
Your contract must clearly state your gross salary before tax and mandatory social insurance deductions. Be wary of contracts that only list a net figure, as this can create ambiguity about who covers tax fluctuations. For any reimbursements (housing, flights, etc.), the process must be detailed. In China, you must submit an official receipt, or fapiao (发票), for the company to legally reimburse you. If the contract promises a “housing allowance,” ensure it specifies whether this is paid as cash (taxable) or requires a rental fapiao (non-taxable up to a certain limit). Vague promises of “allowances” without mentioning the fapiao requirement can lead to financial loss.
Job Scope and Work Location
A vague job description is a major red flag. Your duties should be clearly defined. Clauses like “and other duties as assigned by the company” are common, but they shouldn't be a substitute for a concrete list of responsibilities. This is especially critical in fields like education; a standard teaching contract in China should specify subjects, grade levels, and maximum teaching hours. Equally important is the work location. The contract must state the city where you will be based. Avoid contracts that include clauses allowing the company to relocate you to another city at their discretion without your consent, as this could be used to force a resignation.
Termination and Severance
Understand the conditions for termination for both you and the employer. Chinese law requires a 30-day notice period if you wish to resign after your probation. The contract should outline the legal grounds for dismissal by the employer (e.g., gross negligence, material breach of contract). For no-fault terminations by the company (like layoffs or restructuring), you are typically entitled to severance pay. The standard formula is one month's salary for every year of service with the company, often referred to as “N.” If the company terminates you without proper cause or notice, you may be entitled to “2N” compensation. Your contract should not contain clauses that waive your right to this legal severance.
Ultimately, a Chinese employment contract is not a formality; it’s the primary legal protection you have in your professional life here.
What is one contract clause you’ve encountered in China that was completely different from what you expected back home?
Quick Takeaways:
- The Chinese version of your contract is the only one that is legally binding.
- Your probation salary cannot be lower than 80% of your full contractual salary.
- All expense reimbursements require an official receipt called a fapiao.
- The contract must specify your exact work city to prevent forced relocation.
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