Are you a foreign organisation who wishes to hire staff, or base staff in China without setting up a legal entity?
If you want to hire staff in China, Hong Kong, Taiwan, or Macau you must have a legal entity. This is ok for multi-nationals who already have a presence in China but what if you’re an SMB that the entity setup is in progress, or a larger company who wants to test the waters before committing the headcount, or just a company that wants to place a short term representative in China?
The best way to do this is using a Professional Employment Organization (PEO).
What is a PEO?
A PEO is a company that acts as a go-between. A PEO company hires staff on your behalf so you can bypass the costs and red tape associated the employer risks. In China a PEO is interchangeable with an Employer of Record (EOR) company. The other common terms that refer to a PEO company include; employee leasing, labour dispatching, talent dispatching, employee outsourcing, employment services provider, or Foreign Enterprise Service Company (FESCO).
Why do organisations use PEOs in China, Hong Kong, Taiwan, and Macau?
- Organisations who don’t have a legal entity in China. Reasons for this may include;
- They only need a short term representative for special projects
- They want to test the market before committing to setting up a legal entity
- They don’t want to deal with the complexity of HR laws in China
- They are in the process of setting up a legal entity
- They need an interim solution of moving employees to a new entity
- They do have a legal entity but don’t have headcount funding
- A direct employment contract is not desired or feasible
Advantages of using a PEO
- Hiring employees without a legal entity – If you don’t have a legal entity in China, Hong Kong, Taiwan, or Macau then to hire staff you need to use an employment services provider (a PEO)
- Compliance – HR laws in China, Hong Kong, Taiwan, and Macau are complex in itself but also vary according to province and industry. Often companies find it easier and safer to get a PEO to handle it.
- Save time and money – Due to the complexity of HR laws in China, hiring and managing staff is time consuming and therefore expensive. Expert employment services providers like Galaxy Payroll can do it quicker, better and cheaper than doing it in house.
- Focus on core business – Using a PEO/EOR removes the onerous task of hiring and managing staff and allows companies to focus on their core business.
What Countries do Galaxy Payroll cover?
Galaxy Payroll specialises in employee outsourcing to foreign companies who need to hire staff in China, Hong Kong, Taiwan, and Macau. We work with over organisations from over 100 countries across the globe.
How Galaxy Payroll can help
If you’re an organisation without a legal entity and looking for employment outsourcing or labour dispatching in China, Hong Kong, Taiwan or Macau then Galaxy Payroll can help. We have a deep understanding of HR compliance laws in China, Hong Kong, Taiwan and Macau, and can make this process easy for you. We also provide a bilingual service to our clients (English and Chinese).
Our expert team are ready to show you how to take advantage of employee outsourcing.