Salaries and benefits for employees in China: the complete 2025 guide

As the world’s second largest economy, China has a dynamic labour market with its own particularities in terms of wages, benefits and working conditions. This article provides a detailed overview of these crucial aspects for employees and employers operating in the country.

Wage setting in China

In China, wage determination is a process that combines national legislation, local regulations and individual negotiations.

How much is the Chinese minimum wage?

Unlike in many countries, the minimum wage in China is not set at national level. Instead, it is determined by local governments (cities, provinces and districts) according to the specific socio-economic conditions of each region.

This approach leads to significant variations from one region to another. There is a distinction between the minimum monthly wage for full-time workers and the minimum hourly wage for part-time workers. Here are some examples of minimum monthly wages in major cities:

The minimum wage is revised periodically by the local authorities, usually at least every two years, in accordance with the China Employment Promotion Plan. Employers are obliged to respect the minimum wage in force and to avoid any form of wage discrimination. Social security contributions are calculated on the basis of gross salary and also vary from province to province.

What factors influence wages in China?

Several key factors influence wage levels in China:

• Region: as mentioned above, regional disparities are marked. Large cities such as Beijing and Shanghai offer higher salaries than less developed provinces.
• Qualification and experience: the most highly qualified and experienced employees are paid more. Higher levels of education explain the rise in average salaries in China.
• Spoken languages.
• Sector of activity: certain sectors, such as finance, technology and medicine, are known for offering more attractive salaries. In these strategic sectors, companies are looking to recruit the best profiles.
• Nationality: expatriates often receive higher salaries to offset the cost of living and attract international skills.
• Type of company.

What social benefits does being an employee in China offer?

Employee benefits in China consist of a compulsory social security system supplemented by optional benefits.

China’s compulsory social security system, known as the “5+1” system

China’s social security system is based on five main insurance schemes and a housing fund, financed jointly by employers and employees. Contribution rates vary from region to region. Here are the components of the system:

• Old-age insurance: contributes to employee pensions, with pooled contributions to finance current pensions.
• Health insurance: covers a large proportion of medical costs, including hospitalisation and medicines, and often includes maternity insurance.
• Unemployment insurance: provides temporary financial assistance in the event of involuntary job loss.
• Industrial accident insurance: protects against work-related injury or illness, covering medical expenses, rehabilitation and disability benefits.
• Maternity insurance: provides financial support for employees during pregnancy and childbirth.
• Housing Fund (“+1”): helps employees save for the purchase of a home, with contributions from both the employer and the employee.

Optional benefits offered by certain companies in China

The gross salary is negotiated at the time of hiring and must be stipulated in the employment contract. A variable component based on performance or bonuses (monthly, quarterly or annual or linked to specific events, such as Chinese New Year) may be included. To increase their attractiveness, companies may also offer additional benefits, such as a 13th month’s salary or specific bonuses, to retain their employees. In China, it is common practice to offer additional benefits such as :

• Allowances to cover expenses such as accommodation, food, transport and children’s schooling.
• Additional insurance: companies may offer additional medical cover or private insurance, particularly for foreign employees.

Paid leave in China: holidays and public holidays

Employees also benefit from compulsory leave, including :

• Annual leave (based on length of service).
• Maternity/paternity leave.
• National public holidays.

The length of annual leave is determined by the employee’s seniority, not within the company but in the world of work:

• 1 to 10 years’ professional experience: 5 days’ paid holiday.
• 10 to 20 years’ professional experience: 10 days’ paid holiday.
• More than 20 years’ professional experience: 15 days’ paid holiday.

.Working hours and overtime in China

The legal working week in China is 8 hours a day and 40 hours a week, but an employee in China works an average of 44 hours a week. Overtime is permitted, but limited to 3 hours a day and 36 hours a month, with compulsory pay. During the week, overtime is paid at 150% of the basic hourly wage.

The rules of employment in China: deciphering them with the right partners

The Chinese labour market is characterised by a combination of government regulations, local practices and negotiations. Understanding the framework and practices surrounding employment is essential for companies wishing to recruit, retain and effectively manage their teams in China.

VVR International helps companies to structure and optimise their HR policy in China. Whether it’s a question of local recruitment, legal compliance, salary negotiation or freelance administration, our team of HR experts can guide you in making the right choices and building a sustainable HR strategy tailored to the local situation.