What's the Minimum Wage in China in 2023/2024? Master Guide

What's the Minimum Wage in China in 2023/2024? Master Guide

What's the Minimum Wage in China in 2023/2024? Master Guide

December 21, 2023

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Key Takeaways

  1. In China, minimum wage levels are set at the provincial, autonomous area, and municipal levels
  2. In 2023, the Shanghai monthly minimum wage was RMB 2,690
  3. Penalties for minimum wage violations may include fines, warnings, and often legal action
Summary

 

Understanding salary standards in a new market is essential to many facets of a successful start and effective long-term strategies when expanding overseas. Understanding the minimum wage in China and how it affects future pay expectations for employees can make a big difference in job performance, long-term retention, and employee satisfaction.

Foreign companies in China remain at risk of intense scrutiny from the government, so failure to provide employees with their minimum worker benefits, including a correct minimum wage, typically results in serious penalties.

In 2023, the news has been full of stories of companies in China, both local and foreign, being fined millions of dollars or penalized for improper workplace practices. However, knowing the law in these cases is just half the battle. That’s why INS Global offers all the support you need to understand local best practices and benchmarks in China.

 

How the Minimum Wage Functions in China

 

In China, minimum wage levels are set at the provincial, autonomous area, and municipal levels rather than through a single national minimum wage.

Based on variables including the local cost of living, the state of the economy, and other considerations, each region determines its own minimum wage(s).

 

Determining the Minimum Wage in China

 

Periodic modifications to minimum wage rates may be made annually or less frequently in some cases, with the majority of provinces having updated their rates in 2023.

When deciding whether to raise the minimum wage, local governments frequently consider the state of the economy, inflation, and the average salary level in the area.

 

What is the Minimum Wage in China in 2023 and 2024?

 

In 2023, the minimum wage in China is set as follows in chosen major cities or provincial areas:

 

Province/Region Monthly minimum wage

(RMB)

Hourly minimum wage

(RMB)

Anhui 2,060 21
Beijing 2,420 26.4
Chongqing 2,100 21
Guangdong 2,300 22.2
2,360
Hainan 2,010 17.9
Jiangsu 2,280 22
Shanghai 2,690 24
Sichuan 2,100 22

 

 

Exceptions and Adjustments to the Minimum Wage in China

 

Special Economic Zones

 

Special economic zones are often designated to encourage economic development and foreign investment. As a result, they may have different regulations regarding minimum wages, and these will be available from the zone authorities.

 

Industry-Specific Adjustments

 

Certain industries or sectors may have different minimum wage levels based on the nature of the work, generally due to a CBA or similar agreement made with the relevant workers’ organization.

 

Employee Experience and Skill Levels

 

In some regions, there may be variations in minimum wage levels based on an employee’s experience or skill level.

 

Probation Periods

 

Workers in their probation period may be paid up to 20% less than the full wage agreed upon in their employment contract. However, the probation period wage must not be less than the local minimum wage, and it cannot be less than the salary received by the lowest-paid employee with the same job in the company.

 

 

The Minimum Wage in China for Special Work Hours

 

Overtime

 

In accordance with China’s Labor Law, the standard working week is defined as 8 hours per working day, spanning 5 days each week.

Any work hours surpassing the standard limit are classified as overtime, necessitating compensation at a rate of 1.5x regular pay.

 

Rest Days and Public Holidays

 

In situations where employees are required to work on a weekend day, they are entitled to receive 2x their normal pay rate, ensuring fair compensation for weekend commitments.

Employees who find themselves working on a Chinese National Holiday are entitled to compensation at a rate of a minimum of 3x their standard pay. The Chinese government has officially designated 7 paid national holidays, which include New Year’s Day, Chinese New Year/Spring Festival, Qing Ming Festival, Labor Day, Dragon Boat Festival, and National Day.

 

Untaken Holiday Leave

 

Should an employee be unable to use paid annual leave or choose to forgo it, the employer must compensate the employee with the standard wage plus 2x their standard salary for each untaken day of leave.

 

Tools for Determining Minimum Salaries in China

 

Local Labor Bureaus

 

Local labor bureaus or authorities determine and announce minimum wage levels in their respective regions.

 

Public Announcements

 

The rates for the minimum wage in China are typically announced through official channels and made publicly available for employers and employees.