Open-Term Employment Contracts in China

An open-term contract has no expiry date; conversion is often a statutory right.

Under the Labor Contract Law, an open-term contract continues until a lawful termination route is used. If the employee has completed two consecutive fixed-term contracts with the same employer, or ten years’ continuous service, the employee may generally require an open-term contract on renewal. The employer cannot usually insist on a third fixed term. Written form, social insurance and the same city rules still apply. Local practice on counting ‘consecutive’ terms and internships needs a file, not a slogan.

The classification screen

4 questions before you choose the route.

This page identifies the right question and evidence. It does not determine the legal outcome on a reader’s facts.

How many consecutive fixed terms have already been used?

Count signed terms with this employing entity, including renewals.

Count

Has continuous service reached ten years?

Include prior terms and check group-entity hops that may still count.

Tenure

Is the employee asking for open-term on renewal?

The statutory conversion is typically at the employee’s election.

Election

Is there a lawful exception?

Some project, retirement-age and other exceptions exist; they are narrow.

Exception

Working rule: Under the Labor Contract Law, an open-term contract continues until a lawful termination route is used.

What changes the answer

The signal ledger.

These facts move the question beyond a label and into a product, money-flow and control analysis.

Signal

Ask the operating question

Why it changes the route

Second renewal

Are you about to issue a third fixed-term contract?

That is the usual conversion fight.

Entity hop

Was the employee moved among WFOE, dispatch and a related company?

Counting consecutive terms can follow the real employing relationship.

Refusal to sign

Did the employer refuse open-term after the employee requested it?

That path can support double-wage or termination-with-severance claims.

Prepare before you escalate

Bring a compact evidence docket—not a pitch deck.

Give a compliance team or counsel the operating facts that reveal the perimeter.

01Contract chainEvery labor contract, renewal and secondment letter with dates.

02Service recordOnboarding date, entity names and social-insurance payment history.

03Renewal communicationsWho offered which term, and any employee request for open-term.

04City notesLocal implementing practice if the workplace is not where HQ sits.

Common confusions

Questions people ask before they build.

Short answers for orientation. The right result can change with the service model and current rules.

Can we keep using one-year contracts forever?

Generally no. After two consecutive fixed terms the employee can usually require an open-term contract. A paper trail of ‘voluntary’ third fixed terms is a dispute risk.

Is open-term the same as ‘cannot fire’?

No. Open-term still ends through the statutory termination routes, with the usual evidence and severance rules. See the termination guide, not this page.

Primary authorities

Reviewed sources support orientation, not a fact-specific assessment.

National laws database (NPC)

PRC Labor Contract Law (gov.cn)

Ministry of Human Resources and Social Security

Supreme People’s Court