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China PEO (Professional Employer Organization)

VERDICT:

The best China PEO in 2024 is Horizons. With its regional HQ in Shanghai, and in-depth understanding of China employment and tax laws, Horizons is your ideal China expansion partner

Key Takeaways

  • A China PEO is a company that specializes in payroll, HR, and benefits administration support for international companies hiring in China.
  • A China PEO may operate only in the Chinese market or be part of an international PEO company with operations in China. 
  • The top 5 China PEOs in 2024 are Horizons, Deel, Remote, Safeguard Global, and Velocity Global

What is a China PEO?

A China PEO is an entity that acts as an outsourced employer for foreign companies operating in China. It enables foreign businesses to establish a presence and hire employees in China without setting up their legal entity or navigating the complexities of Chinese employment laws, labor contracts, and payroll systems.

China PEO is often used interchangeably with ‘China Employer of Record’ or ‘China EOR.’ A China EOR is a company in China that becomes the legal employer of your team based in China. The team continues to work under your company’s operational direction. Usually, a China PEO offers China EOR services, and vice versa. 

A China PEO may operate solely in China (that is, as a domestic PEO) or be a global PEO with operations worldwide in addition to China. 

Top 5 China PEOs

When hiring employees in China, you must choose a PEO with a deep knowledge of China’s employment laws and local market conditions. Here is our top 5 list of China PEOs:

  1. Horizons (also known as ‘New Horizons Global Partners’) is a globally recognized PEO with a regional headquarters in Shanghai. It offers comprehensive China HR solutions and is known for its expertise in recruitment, payroll, and compliance. Please find out more about its offerings in our Horizons PEO review. 
  2. Deel is a global PEO and HR platform that recently initiated operations in China. Through a market-leading SaaS platform, Deel offers various services, including HR management, payroll processing, legal compliance, and employee benefits administration. Read more about Deel’s hiring solutions in our Deel HR review. 
  3. Remote is a leading international PEO and EOR platform, allowing you to hire and employ workers in around 100 locations, including China. Remote is renowned for its emphasis on compliance and is the ideal partner for companies seeking assurance of legal compliance in China. 
  4. Safeguard Global provides an international PEO and EOR service in 170 countries, including China. In addition to compliant employment solutions, they can also help you open a subsidiary in China. 
  5. Velocity Global provides a premium PEO service in China, providing ‘white glove’ customer support for those who need it. 
An infographic about a China PEO works.

Benefits of a China PEO

Compared to the standard option of opening a legal entity in China, engaging a China PEO has a range of benefits: 

  • China Market Entry
    China PEOs provide a streamlined process for foreign businesses to enter the Chinese market swiftly. They eliminate the need to register a company in China, set up payroll systems, or register for various licenses and permits.
  • Compliance and Risk Management
    Compliance with Chinese employment laws can be challenging for foreign companies. China PEOs possess in-depth knowledge of local labor regulations, ensuring adherence to legal requirements, minimizing risks, and avoiding costly penalties.
  • China HR Expertise
    PEOs in China offer access to local HR professionals who deeply understand Chinese employment practices, cultural nuances, and labor market conditions. They guide hiring, onboarding, compensation, benefits, and employee relations.
  • China Payroll and Benefits Administration
    China PEOs handle payroll processing, including salary calculations, tax withholdings, and social security contributions. They also manage employee benefits, such as insurance, retirement plans, and leave management.
  • Flexibility and Scalability
    PEOs allow businesses to scale their operations in China quickly. Whether expanding or downsizing, PEOs offer the flexibility to adapt to changing business needs without the administrative complexities associated with internal restructuring.

How China PEOs Work

  • Employment Compliance
    A China PEO will generally become the legal employer of the foreign company’s workforce in China. This is achieved through an employer-of-record relationship, where the PEO assumes responsibility for compliance with local labor laws, employment contracts, and payroll obligations.
  • HR and Administrative Support
    China PEOs provide a range of HR and administrative services, including recruitment assistance, onboarding, employment contract management, payroll processing, tax reporting, benefits administration, and statutory compliance.
  • Workforce Management: While the foreign company retains control over day-to-day operations, including job assignments, performance management, and work responsibilities, the PEO ensures compliance with local labor regulations, manages payroll and benefits, and handles employee-related administrative tasks.
  • Transparent Communication
    Effective communication and collaboration between the foreign company, its employees, and the China PEO are essential for smooth operations. Open lines of communication ensure that HR matters, policy changes, and employee concerns are addressed promptly and accurately.

Engage a China PEO

A China PEO will hire your China-based team, ensuring full compliance with local laws and regulations faster and cost-effectively than opening a local entity in China. 

When choosing a China PEO, pay careful attention to their expertise in the Chinese market, as well as customer reviews, to ensure that you have a seamless hiring experience.

With that in mind, our picks for the top China PEOs are Horizons, Deel, Remote, Safeguard Global and Velocity Global

China Business Guides

FAQs

Absolutely, China PEOs can assist with the recruitment process of employees in China, including job postings, candidate screening, interviews, and onboarding of new employees. They have a deep understanding of the local job market and the expertise to source qualified talent.

A China PEO ensures that all HR activities, including payroll, tax deductions, and employment regulations, comply with local Chinese laws. They stay updated with any changes to legislation to ensure ongoing compliance.

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