The big state-owned banks in China are looking to expand their global footprints. This means that when they set up in big financial centres like London, they initially move their own people across and then look to hire locally – a divide is emerging.
When staff move from China to London, they tend to give them different treatment to locally hired staff. Some of these ‘perks have uniquely Chinese characteristics.
One Chinese bank in London provided accommodation to all expat staff. This doesn’t mean housing allowance - the bank rented a big chunk of an apartment building for all its Chinese staff to live together. If you haven’t seen enough of your colleagues in the office…
"They are much more organized than us," says one locally-hired employee of this bank, speaking anonymously. "They never invite us when they have parties in their building. They just have their own happy hours."
There’s a clear divide between those transferred across from China and those hired on the ground in London. They don’t share common interests and rarely get on either personally or professionally. Expat staff even continue to use their ‘administrative’ rankings while abroad. These are not westernised job titles, but say a lot about someone’s seniority in China.
This two-tiered HR system continues when it comes to remuneration. Because expats are given accommodation, their (lower) Chinese salary still applies, with only a few other allowances. Those hired on the ground are brought in on London rates.
It works the other way, however. One Chinese bank pays its expat employees a housing allowance, which is almost as much as their salary. “So local staff are only earning half of what the expats make," says an employee of this bank, speaking anonymously.
The one benefit for Chinese expats in London is that if they’re in the UK for five straight years they can apply for permanent residency (PR). Chinese banks would second their staff to London for three years and then give them the chance to extend this once – or six years in the UK. Previously there were staff who could even get more than one extension. Now, much to the annoyance of the expats, Chinese banks are changing this.
"The current policy is to encourage people to move around," says the expat banker. “So, it's unlikely to stay that long now."
What's more, as the Chinese government has tightened expat rules in general, London-based staff are not allowed to apply for a PR now, regardless how long they stay here.
However, since a UK PR opens so many opportunities in the Western banking world, it is so tempting that a few expat staff are applying for it without the knowledge of the bank, we were told.
On family front, the Chinese banks are quickly catching up with international standards. Sources say almost all Chinese banks now allow expat staff to bring their families with them to London, and will hand out extra allowances if their spouse can’t find a job. School fees for children are also covered by the bank, but once the expat term ends and the staff return to China, family members are required go back home, regardless at what stage their children's education is.
As a result, an increasing number of staff only accept an expat term when their children are at least at the age of junior high school, so that once the parents' expat terms ends, children have already reached university age and are able to stay on in London.