Hiring for your China Representative Office. It’s Complicated.
A Representative Office (RO) established by foreign enterprise under Chinese laws and regulations does not have the qualification of a legal person, and it shall not conduct any profit-making activities. According to Chinese laws and regulations, when an RO decides to recruit Chinese workers, it must entrust a service unit which has approved by Chinese Government to engage in labor dispatching services for employing Chinese personnel. In China, there are strict rules and complicated procedures for a service unit to apply and become a qualified labor dispatch entity. In order to use the Chinese personnel in line with laws and regulations, an RO must cooperate with the dispatching entity, like the FESCO and CIIC in China. There would be an Entrustment Agreement concluded between the RO and FESCO, and FESCO shall directly sign a labor dispatch agreement with the dispatched worker and then dispatch him/her to the RO.
According to Chinese relevant provisions on labor dispatch, the labor dispatch entity shall be responsible for paying remuneration and social insurance fee for the dispatched worker. In case that the worker is dispatched to another region, the labor dispatch entity shall obtain the social security insurance coverage for the dispatched worker at the place where the employer concerned is located, and pay the social security insurance premium in accordance with the rules at the place where the employer concerned is located. In case that the labor dispatch entity does not have any presence at the place where the employer locates, the employer will complete the formalities for obtaining social security insurance coverage and pay the social security insurance premium for the dispatched worker on behalf of the labor dispatch entity. Besides, not like the situations where the dispatched workers are employed and working in other types of companies, there is no limitation or restrictions on the proportion of dispatched workers employed for temporary, auxiliary or substitutive job positions in an RO.