China question: What are some of the key things I should look at when drafting employment contracts?

The domestic perspective

Format and content

PRC law specifically requires that an employment contract must contain certain terms, like the identity information of both parties and social insurance, therefore an offer letter cannot serve as an employment contract, unless both the content and format of the offer letter is substantially the same as or similar to that of an employment contract.

The necessity to prepare a province-specific employment contract template is not high. A well drafted template can be used in any province without being challenged. Further, the contract is also not required to be verified or approved by any local authority. Employment at will is not allowed under PRC law. Also, the law does not permit an employment contract to either create any contractual termination grounds that are different from the statutory termination grounds (for example, it is illegal to provide in an employment contract that the employer can terminate the contract with a certain number of months' prior notice without any cause), or amend or preclude any statutory termination grounds. Therefore, PRC legal counsel is highly advisable to ensure the compliance and enforceability of an employment contract.