Getting right personal information protection and maternity leave

Currently, companies worldwide are called by both domestic and international regulations to become corporate citizens rather than merely profitable entities. In China, 2021, domestic legislation focused on data and cyber protection and introduced measures to support the third-child policy. Namely, Personal Information Protection Law (“PIPL”), effective from November 1 2022, obligates companies to strengthen personal data handling, process, and storage, and from late November, provinces and municipalities across China extended maternity leave to support the 3-child policy (announced on May 31, 2021, following the Chinese Communist Party Politburo meeting chaired by President Xi Jinping). As a result, in 2022, human resources (“HR”) across China should diligently implement plans to comply with such changes and obligations.

At Horizons, we have been working with clients to adjust employee policies and summarise the main aspects for human resources to practically implement changes.

Personal Information Protection Law

PIPL is the first legislation to address misuse of personal data and sets forth mandatory requirements for companies processing such data. Though data handling related to human resources do not require the employee’s consent, PIPL does introduce stricter obligations for those handling sensitive personal information, such as biometrics, religious beliefs, medical and health and so forth. Namely, companies shall obtain specific consent and inform such individuals of the necessity and impact on their rights and interests. Therefore, companies should audit the existing personal information processing systems to gain a comprehensive employee data overview and, if necessary, draft specific consent forms aligned with PIPL.

Equally, companies may only transfer personal information outside mainland China by fulfilling provisioned conditions. Under PIPL, such conditions are generally outlined and require further guidelines for companies to proceed ahead. We suggest HR keep abreast of forthcoming related guidelines, especially those handling large volumes of personal information that meet a threshold set by the National Cyberspace Authority.

Maternity Leave

In late November 2021, parental leave extensions were adopted in Chinese cities and provinces to stimulate the 3-child policy. Extended leave policies aim to reduce the burden of childbirth and childcare. The extended number of days varies from province to province or city to city, for example in Shanghai, maternity leave is extended to 158 days. For companies, the amended policies shall directly impact employee leave policies and workforce planning and costs to cover extended leave.

We suggest that companies should conduct an employee consultation process before any amendments are made to employee leave policies and ensure employees are entitled to the legally allocated number of leave days. Namely, clear specification of the type of leave and number of days such as maternity leave, paternal leave for working parents and carer’s leave. In this manner, companies can reduce the risk of labour disputes since the amendments are consented by employees and legal blinding.

Both PIPL and extended maternity leave reflect Environment Social and Governance (“ESG”) principles emerging in China. As an important international topic, we anticipate ESG to be present in forthcoming legislation in China, however, governed by President Xi Jinping Thought on Socialism with Chinese Characteristics.

This content appears as a courtesy of Horizons Corporate Advisory, a proud member of the China Collaborative Group (CCG Association). It is informational in nature and does not constitute legal advice or establish an attorney-client relationship between you and its author, publisher or any member of CCG. For more information, please visit www.horizons-advisory.com. 

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As of 2019, there are an estimated one-million foreigners working in China. For many foreigners, working in China offers multiple opportunities to expand one’s career, learn Mandarin and acquire valuable cross-cultural skills. While there are numerous work opportunities in China, many foreigners express difficulties and uncertainties in navigating the work visa application process, including the obtaining of the proper work documentation and, in many cases, the proper steps required for transferring to a new company. In this post, we provide some practical tips for those looking to work in China or are already working in China but could use a refresher on the work visa issuance process.

Work Visa (Z Visa), Work Permit, Residence Permit

Work Visa (Z Visa)
In China, the Work Visa (commonly referred to as the Z Visa), Work Permit and Residence Permit are three separate items with separate functions and formalities for their acquisition.

Holding a Work Visa allows a foreign national entry into China with a stated purpose of such entry, which is legitimate employment. Work Visas are issued outside of China by a Chinese Embassy or Consulate. However, since March 2017, the Foreign Affairs Office in China no-longer issue the requisite government invitation letter, which is a requirement of among one’s supporting documents for the issuance of a Z Visa. Rather, foreigners may now enter China under other visa categories, such as a tourist or business visa, prior to applying for a Work Permit and Residence Permit. However, a Work Permit and Residence Permit must be obtained prior to any foreigner commencing work in China.

Work Permit
A government-issued Work Permit allows a foreigner to work in China for a company specified and job position stated on the Work Permit application. The Work Permit is issued inside of China. Applications are made through the service system for foreigners working in China and involve both online and offline submission of documents for approval. Therefore, applicants are encouraged to utilise the online submission and approval process prior to entering in China (since it allows for ample time to collect the required documents and any other documents further requested at the discretion of Chinese authorities). Once online approval is obtained, an overseas foreigner can enter China and submit the original Work Permit documents.

Residence Permit
The Residence Permit allows one to reside in China. For those holding a valid Residence Permit, there are no restrictions placed on exiting and entering in China. Customarily, the Residence Permit is issued inside China and is good for one year. The Work Permit is the precondition of the Residence Permit; therefore, the application of the Residence Permit follows the obtaining of a Work Permit.

First-time application

Work Permit
Within 15 calendar days of a foreign individual signing a labour contract, the sponsoring company should proceed with the application for the individual’s Work Permit (for further information about the Work Permit, please see our previous post: Keeping on top of employment visa regulations and application procedures). Customarily, the timeline for online approval of a Work Permit is five working days upon the receipt of the requisite online documents; the offline approval is 10 working days upon receipt of the original documents.

Residence Permit
Application for a Residence Permit should take place within 30 calendar days upon the issuance of an individual’s Work Permit. Customarily, the Residence Permit is approved and issued within 10 working days upon receipt of the application.

Alteration

Any changes in the original information submitted in one’s application for a Work Permit or Residence Permit shall be updated a necessary. This includes updated for a change of address, change of passport and so forth. Failure to updated such changes will be considered a violation and may be subject to penalties.

Termination

An existing Work Permit may not be transferred to a new sponsoring company. Since the Work Permit allows a foreign individual to be employed by the original sponsoring company in the position specified in the Work Permit application, it is required that the original issued Work Permit be terminated prior to applying for a new Work Permit under a new sponsoring company. In this process, the original company is required to issue a release letter and shall cancel both the Work Permit and Residence Permit within 10 working days upon the letter.

Keep in mind…

A China Residence Permit is approved and issued on the prerequisite of the Work Permit applied under the original sponsoring company. Therefore, both the Work Permit and Residence Permit shall be cancelled concurrently. Upon termination of the Work Permit, failure to cancel the original Residence Permit deems its holder as staying in China illegally, making them subject to fines of RMB 500 per day and at risk for deportation. 

Once both permits are cancelled, a Humanitarian Visa will be issued and placed in the individual’s passport. Under the Humanitarian Visa, one may remain in China up to 30 calendar days upon receipt of the visa. In this instance, a new sponsoring employer has the opportunity to complete the formalities for a new Work Permit and Residence Permit for a foreign individual.  

It is important to note, the procedures and requirements for all China work permits are dependent on the location of employment and the local authorities entrusted with the power to lawfully implement regulations, according to the circumstances. For example, work permits in a Special Economic Zone carry less stringent criteria in order to attract foreign talent, whilst first-tier cities may establish stricter criteria in order to give preference to local workers. Therefore, navigating work-in-China procedures should be advised by a legitimate professional who understands the local procedures and regulations.

This article originally appears on Horizons Corporate Advisory news and information blog at www.thesquare.com.

For more information about the employment of foreigners in China or other related corporate matters, send us an email at talktous@horizons-advisory.com, and we’ll have a Horizons professional contact you. 

Horizons Corporate Advisory helps clients solve complex problems, thrive and be inherently responsible in their business activities worldwide. The countries we operate in include Belarus, Belgium, China, Colombia, Costa Rica, Cyprus, Ecuador, France, Germany, Hong Kong, Indonesia, Italy, Lichtenstein, Luxemburg, Macau, Malta, Mexico, Mongolia, The Netherlands, Nigeria, Portugal, Russia, Singapore, Spain, Switzerland (French and German-speaking cantons), Turkey, United Kingdom (England and Wales) and the United States of America.

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