Annual leave policies in China set minimum paid vacation that every compliant employer must provide, including who qualifies, how many days are due, when leave can be carried over, and how to compensate employees if leave isn’t arranged. The core rules come from the State Council Regulation on Paid Annual Leave and the national Implementation Measures.
Annual leave policies in China — what the law actually says (official sources)
China’s system is defined by two nationwide instruments:
- Regulation on Paid Annual Leave for Employees (State Council Order No. 514). It sets eligibility, entitlements, exceptions, scheduling, and the 300% pay rule if statutory leave isn’t arranged. Government of China+1
- Implementation Measures for Paid Annual Leave of Enterprise Employees (MOHRSS Order No. 1). It explains pro‑rating, carryover arrangements, and payroll calculations used in practice. Government of China
Eligibility and cumulative working years
Employees who’ve worked at least 12 consecutive months are eligible for statutory paid annual leave. The number of days they get is based on cumulative working years (time across different employers also counts for entitlement purposes). Government of China
Entitlements by service length
Under annual leave policies in China, the minimum statutory leave is:
| Cumulative working years | Statutory paid annual leave |
|---|---|
| 1 to <10 years | 5 days |
| 10 to <20 years | 10 days |
| ≥20 years | 15 days |
These are national minimums all compliant employers must respect. Government of China
Public holidays and weekly rest days don’t count
National public holidays and weekly rest days are not deducted from annual leave. If a holiday falls during leave, it doesn’t reduce the employee’s statutory balance.
The exceptions that cancel annual leave in a given year
There are narrow scenarios where an otherwise eligible employee won’t receive statutory annual leave for that year:
- The employee already enjoys winter/summer vacation longer than their leave entitlement.
- The employee takes personal leave ≥20 days in the year without wage deduction.
- The employee takes sick leave exceeding service‑band thresholds:
- 1 to <10 years of cumulative service: ≥2 months
- 10 to <20 years: ≥3 months
- ≥20 years: ≥4 months
Pro‑rating for joiners and leavers (the statutory formula)
For mid‑year joiners or leavers, statutory leave is pro‑rated by calendar days worked in the year:
Pro‑rated annual leave = (Remaining calendar days in the year ÷ 365) × Annual entitlement
Fractions under one full day, after the pro‑ration, don’t have to be granted. Government of China
Example (mid‑year joiner):
An employee with 12 cumulative years joins on July 5. Remaining days ≈ 180. Entitlement = 10 days. Pro‑rated leave = 180/365 × 10 ≈ 4.93 days → the fractional part under one day need not be granted.
Scheduling, carryover, and expiry — the one‑year rule with consent
Employers should schedule leave within the calendar year, but if business needs require, leave may be carried into the next year only and only with the employee’s consent. Continuous rolling beyond one year isn’t contemplated by the regulation.
Unused leave and the 300% compensation rule
If an employer doesn’t arrange statutory leave (or arranges fewer days) with the employee’s consent, the company must pay 300% of the employee’s daily wage for each unused statutory day within the same year. The 300% figure includes the regular wage already paid, so the additional payable portion is 200% of the daily wage.
Daily wage calculation using the 21.75 factor
For unused‑leave compensation, the daily wage is the employee’s average monthly wage (last 12 months, excluding overtime) divided by 21.75. For employees with fewer than 12 months of service, use the actual months worked.
Worked example:
Average monthly wage (12 months, no overtime) = RMB 12,000 → Daily wage = 12,000 ÷ 21.75 = RMB 551.72. If 5 statutory days were not arranged, compensation owed = 5 × 300% × 551.72 = RMB 8,275.80.
Coverage notes for dispatch workers and foreign staff
The measures apply to all enterprise employees who’ve established a labor relationship with an employer in mainland China, which includes dispatch employees (with the dispatching entity as employer of record) and locally‑contracted foreign staff. Contractual policies can grant additional leave, but statutory minimums still apply.
HR compliance checklist (print‑friendly)
| Task | What “good” looks like | Legal hook |
|---|---|---|
| Map eligibility | Track each employee’s continuous 12+ months and their cumulative working years for entitlement bands. | (Government of China) |
| Assign entitlement | Apply 5/10/15‑day tiers and keep proof. | (Government of China) |
| Respect holidays/rest days | Don’t deduct public holidays or weekly rest days from leave. | (Government of China) |
| Handle exceptions | Monitor winter/summer vacation, personal leave ≥20 days (no wage deduction), and sick‑leave thresholds. | (Government of China) |
| Pro‑rate fairly | Use the statutory 365‑day formula; note the “fraction <1 day need not be granted” rule. | (Government of China) |
| Arrange & carry over | Try to finish within the year; carry to next year only with employee consent. | (Government of China) |
| Pay for unused days | If leave wasn’t arranged, pay 300% of daily wage; the extra due is 200% on top of normal wages. | (Government of China) |
| Calculate correctly | Use monthly average ÷ 21.75; exclude overtime from the average. | (chinajob.mohrss.gov.cn) |
Model clauses you can adapt today
Eligibility & entitlement
Employees are entitled to paid annual leave under annual leave policies in China, with entitlement based on cumulative working years: 5/10/15 days as required by law. Public holidays and weekly rest days aren’t deducted.
Scheduling & carryover
The Company schedules annual leave within the calendar year. Where business needs require, leave may be carried to the next year only with the employee’s written consent.
Joiners & leavers
For mid‑year joiners or leavers, leave is calculated using the official pro‑rating formula. Fractions under one day after pro‑ration need not be granted.
Unused statutory leave
If statutory leave isn’t arranged with employee consent, unused days are paid at 300% of daily wage, calculated as the average monthly wage (excluding overtime) divided by 21.75.
FAQs about annual leave policies in China
Do probationary employees get statutory leave?
If they’ve passed 12 consecutive months of work (including prior employment time for entitlement determination), they’re covered like any other employee.
Can an employee waive leave?
Only if the employer arranged the leave and the employee declined in writing; otherwise, the 300% compensation rule applies for unused statutory days.
How many years can we carry unused statutory leave?
At most to the next year, and only with the employee’s consent. Beyond that, pay rules apply; habitual rolling carryovers aren’t contemplated by the regulation.
What’s the statute of limitations for claims on unused leave pay?
Judicial practice often treats the extra 200% as economic compensation with a one‑year arbitration limit; check current local practice with counsel. A 2024 practitioner guide summarizes prevailing views.
Where can I read an international summary?
The ILO NATLEX entry provides a concise overview of the State Council Regulation and related instruments.
FAQs about annual leave policies in China
Do probationary employees get statutory leave?
If they’ve passed 12 consecutive months of work (including prior employment time for entitlement determination), they’re covered like any other employee. Government of China
Can an employee waive leave?
Only if the employer arranged the leave and the employee declined in writing; otherwise, the 300% compensation rule applies for unused statutory days. chinajob.mohrss.gov.cn
How many years can we carry unused statutory leave?
At most to the next year, and only with the employee’s consent. Beyond that, pay rules apply; habitual rolling carryovers aren’t contemplated by the regulation. Government of China
What’s the statute of limitations for claims on unused leave pay?
Judicial practice often treats the extra 200% as economic compensation with a one‑year arbitration limit; check current local practice with counsel. A 2024 practitioner guide summarizes prevailing views. Law.asia
Where to get help
If you’re setting up payroll, headcount, or a handbook, implement annual leave policies in China alongside attendance and time‑off controls. For compliant outsourcing support, see Payroll & Tax Solutions in China | FDI China for implementation, documentation, and monthly payroll services.