How To Negotiate A Salary In China

This week Hutong School blog was visited by guest blogger: Laowai Career

Most tourists who come China experience some form of culture shock. China can be an incredibly overwhelming place. The language, food, and customs are dramatically different. Yet with patience, an open mind, and a willingness to do a little research, visitors in China soon see that the country’s difference is what makes it so special.

But what about those who do end up taking the leap of relocating to work in China? Living and working in a new country presents many challenges, many of which occur in the workplace. One thing that never fails to make foreigners working in China sweat is dealing with salary negotiations.

Finding a job in China is usually pretty straightforward; particularly if you’re able to line something up before you arrive. However, there are a few things you need to know before you sit down for that crucial salary negotiation.

Negotiate salary China

Understand the Chinese Way

In China, salary negotiations take place face to face and over a period of weeks, even months, so it’s crucial that you enter into them with a clear goal of what you want to achieve. Keep records of each conversation you have with your boss in each round of negotiations and make a plan for what you want to focus on next time. Do your research and learn as much as you can about jobs in China ahead of time. Did you know that in China employers pay additional taxes on their employee’s wages that acts as a form of social insurance? This tax can push the cost of your wage for a company up by 40 percent. Did you also know that you will get an extra month of pay during Chinese New Year, meaning you will receive 13 months of pay for 12 months of work? No? Well, now you do! Knowledge is power and the more you know the more you can achieve.

Be Mindful of Chinese Customs and Etiquette

Having an awareness of workplace etiquette in China will also vastly improve your salary negotiation. In Chinese, the word for ‘negotiation’ consists of both the character for ‘discuss’ and the character for ‘judge’. Negotiation in China is an art when trying to improve the relationship between parties, in building trust and reaching an understanding that is mutually beneficial. In Chinese culture, the concept of ‘saving face’ also comes into salary negotiation. Employers do not want to feel as though they have been forced to make a decision, nor do they want you to feel belittled or disrespected. In China, salary negotiation is a long, dynamic process that will often not have clearly defined outcomes that are made binding by a contract. Many Chinese people prefer to focus on interpersonal relationships in the workplace rather than clear-cut objectives and outcomes.

Assemble a Team

It is common in China for salary or employment contract negotiations to involve a number of people. Accustomed to attending a meeting with a manager in a one-on-one setting, those new to China can find it unnerving to be faced with a whole gang of smiling faces in their manager’s office. Often there will be a number of negotiators present in one meeting but only one of the people present is making the decisions. Try to identify that person and direct your conversation towards them. Also bear in mind that it is quite normal to bring a team of people into negotiations for yourself, perhaps including a translator and a colleague.

Negotiate salary China

Build Good Guanxi

Guanxi is a complex and deep-rooted concept to do with personal connections. Many foreigners think of guanxi as being something akin to good networking or being members of the right club and institution, but in China, an individual’s social capital is worth more than this. A person’s guanxi is essentially defined by their standing within their peer group and the status of their close acquaintances and relations. Good guanxi is maintained by reciprocity. Favors are granted with the expectation that they will be returned, but not necessarily immediately. For good quality guanxi, you’ve got to be prepared to stay in the game.

Negotiate salary China

Be Patient and Be Prepared to Prove Yourself

As we’ve mentioned, salary negotiations in China can take longer than people used to working in America or Europe are accustomed to. Chinese people are generally understated in their manner and are put off by people who are overly ebullient or big talkers. It’s wise to behave in a modest, respectful manner during negotiations. If possible, it’s also a great idea to socialize with your Chinese colleagues in order to get to know them on a more personal level before, during, and even after negotiations. Learn to have patience with Chinese customs and take the time to reflect on your position. Be prepared to compromise and never ever try to cut a negotiation short. Playing it cool and feigning indifference once you have clearly stated your case can also work wonders.

With all of that said, the simplest and most effective advice for entering into salary negotiations with your boss is to relax, smile, and embrace the Chinese way.