Understanding how to effectively manage a local team and make HR rules clear from the beginning is important for companies operating in China. Having a well-structured and practical employee handbook can be very helpful in this aspect.
It is a valuable document to have in managing everyday employment situations between employees and employers, and an important source of information and evidence when handling cases of labour disputes.
The EU SME Centre recently published a new guide – Preparing an Employee Handbook in China, which explains in detail the essential elements that should be included in the handbook and shows examples on how to make accurate social insurance calculations. Below is an overview of the key elements for a standard employee handbook in China.
1. General Behaviour – Rules about the general behaviour of employees should be included, covering discipline, company property and disciplinary punishment. Regulations on discipline at work cannot be included in the employment contract, but can be included in the employee handbook. Forbidden behaviours such as harassment or discrimination should be clarified in this section.
2. Standards for Recruitment Procedures – The detailed recruitment procedure and standards should be elaborated in the employee handbook. First, it provides guidelines for both parties (employer and candidate/employee) about the recruitment procedure and requirements and, secondly, it may serve as the basis for additional labour-related procedures. A definition of “unqualified” should be incorporated into the employee handbook, which depends on the position and business scope, and must to be defined on a case-by-case basis.
3. Workplace Security – Clarifies rules concerning workplace security and safeguard, safety production, fire prevention and accident handling, depending on the type of industries.
4. Working Hours and Overtime – Under current Chinese employment laws and regulations, there are three types of working hour systems – standard working hour system, comprehensive working hour system and non-fixed working hour system. The employee handbook should clarify the type of working hour system that is followed by the company. In addition, an employee in China is entitled to overtime payments for work exceeding the statutory working hours, but the calculation varies under the different working hour systems.