CHINA EOR & PEO · EMPLOYER OF RECORD
Tap into China's high‑quality, cost‑competitive talent pool through a trusted employer of record, while you stay focused on your core business.
EOR and PEO are both viable ways for foreign companies to hire in China without building a large in‑house HR team, but they solve different problems and fit different stages of your China strategy.
China's BPO and HR outsourcing market has shifted from low‑cost, transactional work to higher‑value, knowledge‑intensive services in technology, finance, e‑commerce, and advanced manufacturing. The market was valued at around USD 19.7 billion in 2024 and is projected to grow at roughly 12 percent annually through 2030, with HR outsourcing among the fastest‑growing segments.
At the same time, China's employment environment is uniquely complex. Labour contracts, social insurance and housing fund, and individual income tax must all align across the same jurisdiction, with tightening enforcement in major cities such as Beijing, Shanghai, Shenzhen, and Guangzhou. For foreign companies unfamiliar with Chinese policy and practice, "experimenting" with in‑house hiring or loosely structured contractors can easily create compliance risk, especially with small initial headcount.
Choosing the right structure – EOR or PEO – is therefore not just administrative; it is a core risk management decision.
An Employer of Record (EOR) in China becomes the legal employer of your staff on the ground, while you retain day‑to‑day control of work, performance, and strategy. The EOR signs compliant Chinese labour contracts, registers and pays social insurance and housing fund in the correct city, withholds and files individual income tax, and administers payroll, benefits, and terminations in line with local law.
Practically, the EOR sits in front of local regulators and labour bureaus, absorbing legal and administrative responsibilities that would otherwise require your own Chinese entity, HR team, and legal counsel. For companies testing China, an EOR lets you hire in weeks instead of months, without the capital and complexity of a WFOE.
A Professional Employer Organization (PEO) in China operates under a co‑employment model. Your Chinese entity remains the legal employer of record; the PEO shares HR responsibilities such as payroll processing, benefits administration, social insurance registration, and compliance support, while you retain full control over employment decisions and legal obligations.
PEO is designed for companies that have already set up a local entity and plan a more substantial, long‑term presence. It optimises and professionalises an HR function that already exists; it does not remove the need for an entity or fully shield you from regulatory mistakes.
| Dimension | EOR | PEO |
|---|---|---|
| Legal employer | EOR provider is the legal employer of staff. | Your Chinese entity is the legal employer. |
| Need for local entity | Not required; you can hire without any Chinese company. | Required; PEO works only once a local entity exists. |
| Compliance responsibility | EOR bears day‑to‑day compliance and HR legal obligations. | Compliance is shared; legal liability largely remains with you. |
| Speed to hire | Often 2–4 weeks to onboard once terms are agreed. | Dependent on entity setup and internal approvals. |
| Typical use cases | Market entry, pilot teams, distributed small teams, risk‑sensitive projects. | Growth phase, larger stable teams, companies committed to long‑term presence. |
China's labour and payroll compliance regime rests on three pillars: labour contracts, social security and housing fund, and individual income tax. Authorities increasingly expect these to align consistently in the same jurisdiction.
An EOR solution is engineered to sit squarely within this framework: the EOR is responsible for keeping contracts, registrations, and filings aligned with local rules in each city where employees are located. A PEO depends on your entity having set up correct registrations; it then executes HR operations in support of your compliance but does not fully shield you from regulatory mistakes.
You want to hire 3–30+ engineers, support, or operations staff in China to deliver BPO work, but you are not ready to set up a local entity.
You are an industrial or hardware manufacturer testing the China market and need your first sales and service representatives on the ground.
You currently work with contractors in China and want to regularise them into compliant employment.
You already have a China entity and want to outsource payroll, benefits, and HR compliance to a specialised partner.
20+ years of experience in Chinese HR services and employment law, across major cities and regions. We focus on preventive compliance with correct contracts, documentation, and processes.
Team members with work experience in China, the US, Canada, and other markets. We understand how global companies plan, report, and make decisions, and we bridge HQ and local teams in clear, business‑oriented English and native Chinese.
Background in global tech organisations and BPO operations. We are comfortable with agile methods, distributed teams, and data‑driven management, supported by modern tools for HR operations and performance reporting.
We specialise in helping companies hire and manage staff in China through EOR/PEO and BPO models before they establish a local subsidiary, with a clear transition path when you are ready.
Share your plans, and we'll show you what a compliant China employment solution could look like for your business, including timelines, costs, and total cost of ownership.