Introduction

Zhejiang Province, home to major commercial hubs like Hangzhou, is one of China’s most dynamic regions for innovation and international business. But with rapid growth comes strict governance. As foreign companies expand into China or hire remotely from cities like Hangzhou, understanding regional labour laws is essential.

While China’s national labour laws set the framework, provincial interpretations and enforcement can vary. Zhejiang is known for diligent enforcement, particularly regarding employment contracts, working hours, and social insurance. Overlooking local obligations can lead to penalties, reputational risk, and employee dissatisfaction - all avoidable with the right preparation.

Quick Tips

• Issue written contracts within 30 days of employment start - delays can trigger penalties.

• Adhere to standard working hours (8 hours/day, 40 hours/week) unless officially approved for flexible or comprehensive schemes.

• Register employees for all five mandatory social insurances and housing fund contributions locally.

• Maintain detailed personnel records - local authorities conduct random audits.

• Be cautious when using independent contractors - misclassification is heavily scrutinised.

Contracts and Onboarding in Zhejiang: Non-Negotiable Basics

In Zhejiang, written employment contracts are not optional. Employers must issue them within 30 days of an employee starting work. Failing to do so can result in double salary compensation from the second month onwards.

A client I supported last year faced this very issue after onboarding a local hire remotely from Hangzhou. Due to a misunderstanding around courier delays, the contract wasn’t returned within the 30-day window. The company ended up paying two months’ salary twice - an entirely preventable cost.

To stay compliant, employers must:

• Include all required elements (job title, place of work, working hours, remuneration, insurance).

• Use Mandarin Chinese as the primary language, even if a bilingual version is provided.

• Ensure signatures are completed and returned before the 30-day deadline.

Working Time and Leave: More Regulated Than You Might Think

China’s Labour Law sets standard working hours at 8 hours per day and 40 per week. While some flexibility exists (e.g. for R&D or management roles), special permissions must be granted by local labour authorities for alternative systems.

Overtime rules are strict:

• Weekday overtime: 150% of base pay.

• Weekend work (without make-up days): 200%.

• Statutory holidays: 300%.

In Zhejiang, audits often focus on excessive overtime or non-compliant leave tracking. Sick leave, maternity leave, and annual leave entitlements are based on both national law and local implementation guidelines. Employers must accurately calculate leave balances based on employee tenure and ensure leave policies reflect local norms.

Social Insurance and Termination: No Room for Shortcuts

China mandates five types of social insurance: pension, medical, unemployment, maternity, and work injury, plus the housing provident fund. All must be registered and paid locally. Even if your business is headquartered elsewhere in China, you must contribute through Hangzhou/Zhejiang accounts for employees based there.

Termination is also strictly regulated. Probation periods vary by contract length, and severance pay is required unless the employee resigns or is dismissed for serious misconduct. In Zhejiang, authorities frequently side with employees in disputes where termination processes were rushed or documentation was incomplete.

A company I worked with had to rehire a terminated employee after failing to file the proper termination report with the Hangzhou labour bureau. It delayed their hiring plan by three months and triggered a wider audit.

A Real Example: Scaling Safely in Zhejiang

We supported a tech firm expanding its development team in Hangzhou. While the client had strong global HR practices, they were unfamiliar with China’s region-specific obligations. Together, we:

• Built bilingual, locally compliant contracts.

• Implemented a Zhejiang-specific onboarding checklist.

• Registered social insurance accounts through Hangzhou’s HRSS portal.

• Ran line manager training on overtime, leave management, and termination protocols.

As a result, the client grew their team by 60% in nine months with zero compliance issues - a rare achievement in such a tightly regulated region.

Final Thoughts

Hiring in Zhejiang, including Hangzhou, offers access to a vibrant talent pool and booming market. But success depends on getting the legal and cultural details right. Labour laws here are enforced seriously, and assumptions based on your home country (or even other parts of China) won’t hold up.

What’s next for your global people strategy?

Book a free compliance check-in or HR audit with ThinkGlobal HR. Whether you’re just starting to hire in China or reviewing existing setups, we’ll help you build systems that are compliant, scalable, and human-centred - with local insight you can trust.