Answer: Although an employment contract may specify the wages that the employer should pay, yet the employer is entitled to lawfully deduct certain items that the employee is required to contribute or pay, such as for social insurance and personal income tax. The calculation of the wage the employee receives is equal to due wage plus overtime pay plus unused time-off in lieu pay or unused annual leave pay, and then deducting allowable deduction items, namely: <\/p>\n
Net wage = Due wage + Overtime pay + unused time-off in lieu pay + unused annual leave pay- Allowable deduction items.<\/p>\n
Firstly, employees\u00a1\u00af payable hourly wages for normal work hours must not fall below the local minimum hourly rate standard; and the calculation base for their overtime wages shall also be not lower than the standard. In other words, due to unpaid leave and social insurance deduction, an employee earning minimum wage may actually receive a lower wages than the minimum wage standard.<\/p>\n
Secondly, the calculation of overtime pay. Different rates and rules apply to the three different types of overtime, e.g., weekday, weekend, and public holiday overtimes. For detailed calculations of these three types of overtime please refer to “I am an HR manager. How do I calculate overtime pay for employees?” <\/p>\n
Thirdly, allowable deduction items are certain legally permitted items that employers can deduct from employees\u00a1\u00af wages, including personal income tax, social insurance contributions (employees\u00a1\u00af contributions to pension, medical, and unemployment insurances), and other allowable deductions. <\/p>\n
Sometimes, with mutual agreement or upon employees\u00a1\u00af request, employees may receive encashment pay for unused annual leave. Please Refer to \u00a1\u00b0I am an HR manager. How do I calculate employees’ unused annual leave pay from last year?\u00a1\u00b1 Additionally, employers may deduct incorrectly overpaid wages, court-mandated wage deductions, and expenses such as rent and utilities agreed upon by both parties if employers provide accommodations.<\/p>\n
\r\nThis article is a part of our new book<\/strong><\/em><\/div>\r\n\u00a0<\/div>\r\n\u201cEmployment Law in China: A Practical Guide. A book about \u201cWhat should I do\u201d with case laws.\u201d<\/strong><\/em><\/div>\r\n\u00a0<\/div>\r\nStay tuned, and the book will soon be published as an electronic books!<\/strong><\/em><\/div>\r\n<\/blockquote>","protected":false},"excerpt":{"rendered":"Answer: Although an employment contract may specify the wages that the employer should pay, yet the employer is entitled to lawfully deduct certain items that the employee is required to contribute or pay, such as for social insurance and personal income tax. The calculation of the wage the employee receives is equal to due wageRead more about 83.How are employees’ received wages calculated?<\/span>[…]<\/a><\/p>\n","protected":false},"author":4,"featured_media":1083,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37,3,33],"tags":[],"_links":{"self":[{"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/posts\/1244"}],"collection":[{"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/comments?post=1244"}],"version-history":[{"count":0,"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/posts\/1244\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/media\/1083"}],"wp:attachment":[{"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/media?parent=1244"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/categories?post=1244"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.royalaw.com\/en\/wp-json\/wp\/v2\/tags?post=1244"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}