Enterprises need to know when hiring foreign personnel: analysis of compliance process and core points

Enterprises need to know: analysis of compliance process and core points

In the context of globalization, enterprises often need to introduce foreign professionals to enhance their international competitiveness. However, the employment of foreign personnel involves multiple fields such as law, administration and human resources, and improper operation may lead to the risk of illegal employment. Based on the current laws and regulations of China, this paper systematically combs the core provisions and practical points of enterprises employing foreign personnel, and helps enterprises to manage compliance.

1. employment subject qualifications and job restrictions

According to the Regulations on the Administration of Employment of Foreigners in China, enterprises must meet the following conditions to employ foreigners:

1. legality of subject : the enterprise must be established according to law, with no record of serious violation of law and dishonesty, and the employment position must meet the special requirements of "there is a temporary shortage of suitable candidates in China. For example, a technology company's application for employment of foreign engineers was rejected by the labor department because it did not prove the particularity of the position.
2. job compliance : it is prohibited to employ foreign personnel to engage in commercial theatrical performances (except performers approved by the Ministry of Culture), commercial entertainment services, and fields of foreign personnel that are explicitly prohibited by the Chinese government. A foreign-funded enterprise was once punished for arranging foreign employees to take up non-technical administrative posts, which was found to be "job mismatch.
3. salary bottom line : the salary paid by the enterprise to foreign personnel shall not be lower than the local minimum wage standard. A manufacturing enterprise did not specify in the labor contract that the salary was not lower than the minimum standard, resulting in the rejection of the social security application of foreign employees.

2. core licensing process and certificate management

Foreign nationals working in China need to complete the closed-loop management of "three certificates and one sign:

1. notice of work permit : when an enterprise submits an application through the" management service system for foreigners coming to China ", it is necessary to provide the resume, qualification certificate, health certificate and other materials of the personnel to be employed. For example, a multinational enterprise did not provide foreign experts academic certification documents, resulting in a two-month delay in the approval of the license notice.
2. Z visa : foreigners apply for work visa from Chinese embassies and consulates abroad on the basis of permission notice. It should be noted that holders of F, L, C and G visas are not allowed to be employed, otherwise they constitute illegal employment.
3. employment permit : within 15 days after entering the country, the enterprise needs to go to the labor administrative department to apply for the employment permit with the permit, labor contract, passport and other materials. The employment permit is only valid in the area specified by the issuing authority, and a new application is required for cross-regional employment.
4. residence permit : foreigners apply to the public security organ for a work residence permit with an employment permit, which is usually valid for 1-5 years. A foreign company was restricted from leaving the country and faced administrative penalties for failing to extend the residence of foreign executives in a timely manner.

key terms and time limit of 3. labor contract

1. contract time limit : the labor contract shall not exceed 5 years at most, and an application for extension shall be applied for 30 days in advance when it expires. A financial company was forced to pay economic compensation because it did not go through the extension procedures in time, resulting in the invalidation of the employment permit of foreign employees.
2. job content and area : the contract needs to specify the place and position of work, and foreigners are not allowed to work part-time outside the area specified in the employment certificate. An Internet company was found to be "illegal employment" and paid a fine for allowing foreign employees to work across provinces.
3. Five Basic Rights : The contract must guarantee the rights and interests of foreigners such as minimum wage, working hours, rest and vacation, labor safety, social insurance, etc. A manufacturing enterprise was sentenced to bear the medical expenses for work-related injuries for failing to pay work-related injury insurance for foreign employees.

4. social insurance and provident fund payment rules

1. compulsory insurance types : enterprises are required to pay pension, medical, work injury, unemployment and maternity insurance for foreign employees. However, if foreigners come from countries that have signed social security mutual exemption agreements with China (such as Germany and Japan), they can be exempted from paying part of the insurance with the insurance certificate. For example, a German-funded enterprise exempts German employees from old-age insurance, but needs to provide a certificate of insurance issued by the German social security institution.
2. provident fund payment dispute : the current law does not force enterprises to pay housing provident fund for foreign employees, but some areas (such as Shanghai) allow both parties to negotiate the payment. A consulting company for not clear with foreign employees provident fund terms, causing labor disputes.

5. risks and legal liabilities for illegal employment

If an enterprise violates the regulations, it will face multiple penalties:

1. administrative penalty : according to the exit and entry administration law, those who illegally employ foreign personnel shall be fined 10000 yuan for each person illegally employed, with a total amount not exceeding 100000 yuan, and shall bear the removal expenses.
2. criminal responsibility : if foreigners obtain employment permits through forged materials, the relevant person in charge of the enterprise may constitute the "crime of selling entry and exit documents".
3. Labor dispute risk : The labor contract signed between the foreign personnel who have not obtained the employment certificate and the enterprise is invalid, and the enterprise does not need to pay economic compensation, but it is responsible for the payment of wages during the period of illegal employment.

6. compliance management suggestions

1. pre-audit : enterprises should establish a job demand evaluation mechanism for foreign personnel to ensure that the positions meet the "domestic temporary shortage" standard.
2. process standardization : formulate SOP for foreign personnel employment, and specify the list of materials, approval nodes and responsible departments.
3. dynamic tracking : establish a reminder mechanism for the expiration of employment permits and residence permits to avoid illegal employment due to expired certificates.
4. legal training : regularly organize HR departments to learn regulations such as "regulations on the administration of employment of foreigners in China" and "social insurance law" to enhance compliance awareness.

Enterprises should take the law as the cornerstone and compliance as the bottom line when hiring foreign personnel. By improving system design, strengthening process control, and enhancing risk awareness, enterprises can achieve sustainable development while introducing international talents.