According to Article 2 of the Labor Contract Law "This Law shall apply to establishment of labour relationships between enterprises, individual economic organizations, private non-enterprise entities etc in the People's Republic of China  and their workers and the conclusion, performance, variation, rescission or termination of labour contracts." This article does not exclude foreigners. Therefore, in principle, the labor contract law shall also apply to the conclusion, performance, variation, rescission or termination of labour contracts between foreigners and domestic employers. However, there are some inconsistencies between the Administrative Provisions on Employment of Foreigners in China (hereinafter referred to as the "Administrative Provisions") and the Labor Contract Law. After the promulgation of the Labor Contract Law, the Administrative Provisions were revised in 2017 and have not been repealed. Therefore, the issue of application of law has emerged in judicial practice.

The author believes that from the perspective of the legal hierarchy, the Labor Contract Law is certainly higher than the Administrative Provisions as a departmental rule, but there are some special features in employing foreigners: from the perspective of identity, foreigners are different from native people in various rights and obligations; in terms of scale, the employment of foreigners in China is a very small part of the labor market. Therefore, in practice, the "Administrative Provisions", which is specifically aimed at the employment of foreigners, should be more applicable.

Therefore, the following points should be paid attention to when signing labor contracts and establishing labor relations with foreign employees:

1.  The maximum term of labor contract for foreign employees shall not exceed five years. Before the expiration of the labor contract, the formalities for the extension of the employment certificate may be handled with the approval of the local labor administrative department. Therefore, in judicial practice, the provision of Article 14 of the Labor Contract Law on non fixed term labor contracts cannot be applied to foreign employees.

2. According to Article 33 of the Interpretation of the Supreme People's Court on Issues Concerning the Application of Law in the Trial of Labor Dispute Cases (I), Where a foreigner or stateless person enters into a labor contract with an employer within the territory of the People's Republic of China without obtaining an employment certificate in accordance with the law, and a party concerned requests the people's court to confirm his/her employment relationship with the employer, the people's court shall not support the request. Therefore, in judicial practice, if a foreigner fails to apply for a work permit according to law, the labor contract signed with the employer shall be invalid. If a foreigner has already worked, the employer shall pay remuneration for the labor services with reference to the provisions of the contract.

3. After the cancellation of work permit, foreign employees cannot claim to restore labor relations. According to Chinese labor law, the employer who illegally terminates the labor contract will bear the responsibility of paying compensation or restoring labor relations. However, for foreign employees, when the employer has canceled the work permit, it is generally impossible to request arbitration to restore labor relations.

4. Foreigners can only work for "registration units" and are not allowed to do "part-time job" in principle. Article 23 of the Administrative Provisions stipulates: "The employer in China shall be consistent with the employer stated on the work permit." Therefore, foreigners who come to China for employment cannot work in multiple units.

5. The labor contract with foreign employees can freely agree on the cancellation conditions. Article 22 of the Administrative Provisions: "The working hours, rest and off days, work safety and occupational health and social security for foreigners employed in China shall comply with the relevant provisions of the State." It does not include the termination of labor relations. In judicial practice, it tends to recognize the effectiveness of the terms freely agreed between the employer and foreign employees