Overtime in China, The End of “996” and Key Steps for Employers

Chinese employees used to follow the “996” work schedule – 9 am to 9 pm, 6 days a week.

Many tech companies relied on this, and it was widely accepted to drive innovation and growth.

HR managers struggled to balance staff wellbeing with the demands of the business.

The culture of the long working day was accepted, but it never matched up with the labor laws in China. While it might have been tolerated, it is now widely known to be illegal. Actions taken by regulators, courts, and businesses show clearly that 996 is at an end. This means that HR managers can be more active in compliance and workforce planning.

Employers cannot rely on excessive overtime being overlooked and it has become one of the major compliance risks that businesses in China face.

The Legalities

It is important to note that the law has not changed. There is no new legislation banning “996”. However, the long-standing rules are now being enforced. The working-hour system that is set out in the PRC Labor Law states that employees should work no more than 8 hours a day and no more than 44 hours each week on average. They need to have at least one guaranteed rest day.

Overtime is allowed, but there are strict rules. Generally, staff can only work up to one additional hour each day. They may work up to three hours in special circumstances. The total overtime should not exceed 36 hours in any month. Authorized overtime should be compensated at premium rates. This is 150% for weekday overtime, 200% for rest-day work if the worker is not given an alternative day off, and 300% for statutory holidays.

There is alternative systems for roles where there are difficulties in tracking attendance. This may be senior managers, salespeople or project workers, but the employer needs to have consent from the local authorities before they apply different rules. These alternative systems are still strict and the total hours still needs to comply with legal averages, so ‘996’ is still not legally possible.

Regulatory Enforcement

The turning point on this issue happened in 2021. The courts and government jointly released information that declared clearly that 996 is in violation of the law. The case studies were considered direct warnings to employers that they cannot suggest that excessive overtime is voluntary or use a vague internal policy to bypass the law.

They followed this with a broader narrative that condemned the use of excessive overtime, especially in the tech industry. There were well-publicized incidents that had led to deaths and burnout that attracted a lot of attention nationally, and increased government pressure to protect workers.

Enforcement has grown stronger since 2021. The local labor authorities carry out more inspections, the courts have issued more employee-friendly guidance and the state media pushes the message about the impact of long hours on worker health. International bodies are also taking notice. Excessive overtime can lead to scrutiny of ‘forced labor’ by bodies such as the European Union.

Public opinion in China has also changed. Younger workers are now openly critical of long-hour cultures, boosted by the wide use of social media. Many companies have now adopted a strict cut-off time for office attendance so that they can demonstrate compliance.

Why 996 Culture Must End

996 is not compatible with labor laws. If someone is in such an arrangement, then this means that they are working 72 hours a week. Even creative work with overtime allowances cannot justify this amount of time spent in the workplace. Businesses can’t rely on contract clauses or culture to justify excessive overtime.

There is also an increase in the practical risks. Employees now know their rights and are willing to take legal action if necessary. This can lead to large back pay awards that can cover years of unpaid overtime. Employers can find themselves paying out large sums in compensation and fines, particularly if their records are poorly kept. 

Companies also face reputational risk. Those with a reputation for overwork will find it hard to recruit and keep staff. The job market is evolving and younger workers make health and wellbeing a priority. Buyers in global supply chains will now scrutinize labor practices and will avoid companies that are not compliant.

Compliance as Strategy

The move away from 996 means that employers need to be proactive when managing working hours. It is not just a question of banning long days but they need to look at workloads, the expectations and management practices, but they also need to maintain productivity. Many employers will have obstacles. Tight deadlines and performance targets might have been developed on the assumption of excessive overtime. In some industries the employee wants the overtime because it means more money, so there are some areas where enforcement can be difficult. Old management habits can also cause a problem, where managers link presence to commitment.

There are some companies that struggle with the technicalities of compliance. Some roles need to be carefully selected and the appropriate working hour system applied. However, unless the government approves the new working hour system it is invalid. Timekeeping needs to be accurate and if it isn’t the employer is not able to defend themselves in a dispute. Arbitration cases are often settled on the lack of accurate records.

Practical Steps for Employers

Employers need to begin with an assessment of all working hours, looking at attendance systems, log-in data, access records and project reports so they can see where excessive overtime is happening. This step often shows gaps between company policy and the reality of the worker.

Employers then need to align working hours with the law. They need to identify workers who should be under the standard system and those who qualify for flexible systems. If an alternative system is needed, the employer needs to get formal approval from the local labor authority. They should then check employment contracts and ensure that handbooks clearly explain the rules.

Workload planning is essential. They need to check if timelines or headcount need to be adjusted to ensure that hours fall within the legal limits. In many cases, improving workflow efficiency, investing in automation or removing unnecessary administrative tasks can help to reduce the need for overtime. It is not a way to remove flexibility, but to ensure that overtime is the exception not the norm.

Accurate time recording and clear approval procedures are non-negotiable. Overtime should need prior agreement and the systems need to record actual working time. Accurate documents means that not only is the employer compliant but that the company holds evidence if there is a dispute.

Organizations also need to address internal culture. Managers need to respect boundaries and avoid contacting staff out of hours. Performance systems need to reward efficiency and results, not exhaustion.