Transition to PEO
We help your business to switch from a local Chinese entity to a PEO solution.
From company to PEO / employer of record
Transition from a WFOE or Representative Office to a PEO
As part of your expansion in China, there are different reasons why you can choose to set up a local entity, including having a recognizable brand in the country, ease of employment, simplifying your tax position.
However, in many cases, a local PEO is a more cost-effective solution. With a local PEO, you still have the guarantee that your employees are hired in compliance with the law, but saving company administrative costs. Besides this, a PEO can help to run and manage payroll.
100% Local Compliance
Compliance in terms of payroll, social benefits, tax declaration is guaranteed with our local experts.
Cost Savings
We manage HR, payroll, and benefits distribution, leading to savings compared to operating your local entity.
Focus on Business
You are able to focus on your business growth without having to spend time with HR and payroll requirements.
How a PEO in China works?
A Professional Employment Organization (PEO) is a company that provides services under which an employer can delegate employee management tasks such as payroll, employee benefits, and workers’ compensation.
With this solution, the PEO service provider becomes the employer of record in China, bypassing the tedious process tied with setting up a legal entity in China and making expansion into the market much simpler.
In general, a PEO offers these kind of services:
- HR administration
- Payroll management
- Benefits and tax administration
- Visa processing
- Recruitment
- visa for employees
- payroll & benefits
- income tax processing
- business expenses
Procedure for hiring staff in Shanghai
How we get started
01.
You Define
Job tittle, work responsibilities, salary and other benefits for your employees.
02.
We Prepare
A local contract adjusted to your offer and in compliance with China’s labor law.
03.
We Process
Your payroll, tax, compliance & administrative tasks on a monthly basis.
Shanghai Employment Solution
How we legally onboard your team
1. Employees Onboarding
New employee signs private information authorization letter. HROne collects required material. First payment (including deposit) invoiced & paid. HROne and new employee sign a labor contract.
New employee is loaded into the payroll system. Social insurance account, housing fund account & bank accounts are imported into system.
2. Monthly Processing
Payroll information and salary changes (if any). Monthly invoice generated & settled. HROne transfers employee salaries & updates online payroll portal.
Social insurances, housing fund and income tax paid. Employee pay-slip and notification sent out.
3. Year End Processing
Work calendar for the coming year confirmed. Annual salary report prepared, confirmed and reported to the government HR authorities.
Top B2B HR Company in China
Rewarded by Clutch as one of the top B2B companies in China for the unrivaled solutions provided and dedication to our clients.
Employer of Record solutions in China
How Employer of Record in China works
Companies handling ground operations
For companies that require to on-board local staff to handle ground operations (client meetings, sales support, supply management, etc) without setting up a Representative Office or a Wholly Foreign-Owned Enterprise (WFOE), a PEO solutions can save time and costs to start operating in the Chinese market
Companies testing the Chinese market
If you’re exploring how an expansion in China fits into your strategic plan but aren’t ready to take on the costs and risks of setting up an entity, we can help you “test the waters” in China. We can hire employees for you so you can evaluate the readiness of the Chinese market without making the investment needed to establish an entity.
Companies using freelancers based in China
For companies interested in hiring certain freelance talents in China. Freelancing in China for international clients is a tricky subject. UpWork and Fiverr among other freelancing platforms are blocked in China. Additionally, most talents in China prefer jobs that will provide the mandatory social benefits (housing, healthcare and pension fund). Read more on how our Freelancer EOR solution can help you.
Representative offices
Representative offices may only hire up to 10 employees. However, even these employees cannot be hired in-house and their employment must be outsourced to a local HR service provider.
Companies that are closing, but want to keep their team
Some companies may choose to close their entity in China due to various reasons, but wish to retain certain operations active in the country such as their customer service and support teams.
Companies with a local entity
For companies that intend to register an entity in China but want to hire staff in the interim period before formal establishment, a PEO solution is perfect because you will not have to wait months before starting operating in China and you can actually start testing and conducting marketing and networking activities while you wait for the company to be established.
Switch your local Chinese entity to a PEO in a blink of an eye
Agree to a local PEO solution
Before entering into agreement, contact our experts to understand everything about this solution.
Switch staff from local entity to a PEO
In case you have staff hired under your local entity, we will help to switch them to our PEO.
Hire new staff
If needed, we can help you to recruit new staff, and onboard them under the agreement.
We manage HR and payroll, you focus on your business
Once everything is finalized, we are responsible of managing HR and payroll, and you will only have to focus on the growth of your business.
HR in China, made easy.
Hire the best talents in China. Let HROne find & screen the most suitable applicants and coordinate interviews with you.
Hire employees in China without a local entity. HROne handles your HR compliance & payroll so you can focus on your business.
Outsource your onboarding, payroll and mandatory benefits. View your payroll summary through our intuitive online portal.
Frequently Asked Questions
Payroll & mandatory benefits are included in our China Employer of Record and our PEO services.
In many countries, PEO and EOR are the same thing and can be interchanged. However in countries such as China and the USA, PEO and EOR refer to different services:
With Employer of Record (EOR), the service provider takes on the responsibility & liability of the employer since the client does not have a legal entity in the country of interest.
With Professional Employment Organization (PEO), the service provider manages hiring, employment and payroll, but does not take on the responsibility or liability of the employer since the client has a legal entity in the country of interest.
The 13th month bonus in China refers to a bonus equal to one month’s salary that is usually paid at the onset of Chinese New Year.
This 13th month bonus is not mandatory unless explicitly stated in the labor contract upon signing. A 13th month bonus depends on the company’s performance as well as the employee’s performance.
It is possible for employees to receive an even higher bonus (14th or even 15th month bonus) depending on these factors.
Employees in China are entitled to annual leave days based on their work experience.
After working for their employer for 1 year. Employees who have worked less than 10 years are entitled to 5 days paid annual leave.
Employees who have between 10 and 20 years of experience are entitled to 10 days paid annual leave.
Employees with over 20 years of experience are entitled to 15 days of paid annal leave.
Using an Employer of Record/PEO service is often regarded as the modern approach to expanding into China. As long as you do not need to invoice in China, this is a perfect solution for foreign SMEs that want to start their business here. With an employer of record, you can legally hire and manager your team in China, avoiding the time and money required to set up a company.
HROne, the Employer of Record, is legally responsible for your staff during their term of employment in China.
We can hire a local Chinese employee in as little as one day!
Your staff members can be employed and located anywhere in China. Their employment status will be recorded by the local bureau according to their location.
Not necessarily. Staff members can work remotely from home or another location. However, we offer office space rentals upon request.
Yes, our Employer of Record solution can be used to hire both local and foreign staff.
Individual income taxes In China are based on a progressive tax brackets rate:
| Bracket | Annual Taxable Income (RMB) | Tax Rate (%) | Quick Deduction |
| 1 | No more than 36,000 | 3 | 0 |
| 2 | Between 36,000 and 144,000 | 10 | 2,520 |
| 3 | Between 144,000 and 300,000 | 20 | 16,920 |
| 4 | Between 300,000 and 420,000 | 25 | 31,920 |
| 5 | Between 420,000 and 660,000 | 30 | 52,920 |
| 6 | Between 660,000 and 960,000 | 35 | 85,920 |
| 7 | More than 960,000 | 45 | 181,920 |
Social benefits in China are divided into two categories:
- Five mandatory social insurances – These include pension insurance, medical insurance, unemployment insurance, work-related injury insurance, and maternity insurance.
- Housing fund – The purpose of this is to allow employees to save money to buy a house in China.