China -  Chinese law firm

Which issues should a foreign investor take into account when entering into labor contracts?

There are many pitfalls involved in labor contracts. In general, one of the most important issues to take into account are the accuracy of an applicant's CV. A way to do this is to ensure that the employee retains a right to revoke the labor contract in case the items on an applicant's CV turn out to be false. Another important issue is to conduct physical examinations of new employees, both to ensure product quality and consumer health. Furthermore, training is vital in order to guarantee the necessary skills of the employees. A way to ensure that the training has been sufficient is for the employer to have a post-training test before the applicant can be formally employed. Finally, a labor contract must be signed, which stipulates the relationship between the employer and employee, either for a fixed or open period.

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