Do foreign banks always offer the best compensation packages in China?
No is the short answer. In fact, when you add up all their bonuses and numerous non-taxable allowances, employees at Chinese banks often get paid more. Coupled with traditionally shorter working hours, this makes it increasingly hard for recruiters to lure local candidates into international banks.
“The workload is not so heavy and the pay is better. It’s much easier to have a work life balance at local banks. More and more Chinese candidates prefer to work for local banks these days,” says Angela Qi, banking consultant, Manpower Shanghai.
Although base salaries are generally lower than at global banks, the domestic firms pay tax-free allowances covering categories such as transportation, housing, clothing, food, phones and books.
Employees are often unaware quite what the payment is supposed to cover when it appears in their account. “I’d have to check my payroll to tell you exactly what kind of allowances I get,” says Mr Zhu, who chose to work at a domestic bank after retuning from overseas.
Moreover, when it comes to bonuses, domestic ones dish them out on a quarterly and annual basis, while international firms usually pay only once a year. “And at foreign banks, bonuses are paid to performing staff, but local banks will pay bonuses to all staff, if the company has a good year or quarter,” says Qi.
The percentage of bonuses and allowances within total income depends on the bank and the job function. Qi says some local bankers derive as much as half their compensation from these sources, while Zhu receives 20 per cent.
Shareholding commercial banks, such as China Minsheng Bank, Industrial Bank, and China Merchants Bank, and are usually more generous in paying fat bonuses than the big state-owned banks.