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Shanghai Becomes First City in Mainland China to Grant Foreign Domestic Workers Residency

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On March 31, Shanghai became the first city in mainland China to grant a residence permit to a foreign worker providing domestic services. The development is notable given the Chinese government’s usual reluctance to grant foreigners visas for unskilled labor, and reaffirms Shanghai’s status as the mainland’s most international city.

The first foreigner accorded the one-year permit was a maid from the Philippines, who was granted a visa to work for an American executive in Shanghai’s Pudong district. The Shanghai Entry-Exit Administration Bureau has now granted the permit to over 20 foreign domestic workers.

Employers must apply to the Entry-Exit Administration Bureau on behalf of the foreign domestic worker that they would like to hire.

Individuals eligible to apply for a foreign domestic worker to obtain residency are:
•    Foreign high-level professionals with a permanent residence permit (green card) or work permit;
•    High-level professionals from Hong Kong, Macau, and Taiwan; and,
•    Foreigners with a master’s degree or above.

Foreigners employed in the following areas are also eligible to apply on behalf of a domestic worker:
•    The Shanghai Free Trade Zone;
•    The Zhangjiang Hi-Tech Park;
•    Higher education or scientific research institutions; and,
•    Professional areas the Shanghai Municipal Human Resources and Social Security Bureau recognizes as helpful to scientific and technological innovation.

The application requires supporting documents such as a labor contract, a statement of financial support, proof of personal insurance, and a health certificate. Each foreign employer is allowed to employ only one foreign domestic worker. Chinese nationals are not permitted to hire foreign domestic workers.

Foreign domestic workers can first enter China with a tourist visa before applying for the residence permit. However, the Exit-Entry Administration of the Shanghai Municipal Public Security Bureau in Pudong is currently the only office able to process such applications.

Foreign domestic workers were ineligible to work in Shanghai until July 2015, when limited high-level executives and professors were allowed by the authorities to hire foreign domestic workers. This latest reform is part of a series of measures from the Shanghai municipal government aimed at attracting foreign experts and professionals to the city. The municipal government eased visa policies for foreigners in December 2016.

The relaxed visa rules for foreign domestic workers are expected to lead to the arrival of more workers from countries such as Indonesia and the Philippines. An estimated 100,000 to 200,000 Filipino domestic workers are already working in China illegally, though there is demand for more given their English language ability.

Both domestic service employers and employees will benefit from the reform in Shanghai, which will create more transparency and regulatory oversight for a local labor market that was affected by grey practices.

By Dezan Shira & Associates
Editor: Alexander Chipman Koty

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Dezan Shira & Associates is a full service practice in China, providing business intelligence, due diligence, legal, tax, IT, HR, payroll, and advisory services throughout the China and Asian region. For assistance with China business issues or investments into China, please contact us at china@dezshira.com or visit us at www.dezshira.com