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EZIPD · Case Studies
“Do I now need five Chinese employees for every foreign employee before a new work permit application or renewal can be approved?”
“It was approved before. Why am I now being told the company no longer qualifies?”
Your company has business, pays tax, and you are still doing the work. Yet your permit is due to expire, and these claims leave you worried. Is the problem really the number of staff? Or has the company not clearly explained its business and why it needs to employ you?
We recently helped an international freight forwarding company in a developed city in China with a work permit renewal. It had only one Chinese employee at the time. We checked its real business, the team's work and the foreign business leader's duties. We used these facts to prepare the records and an employment justification report, then followed up on the case. The client received renewals of both the work permit and the residence permit for work.
Among the new applications and renewals our team came across in that city in 2026, around half were not approved. With closer checks, it matters even more to explain the company's situation clearly.
What Should You Make of the “1:5” Claim?
First check whether the rule you have heard about applies to your city, type of application and company.
The published basic conditions on China's National Government Service Platform that we checked do not set a uniform 1:5 staff ratio. The employer must be legally set up. The role must meet a special need for which suitable people are not currently available in China. The applicant must have the right skills, and the documents must be real and meet the rules.
Start with some more specific questions. What do your current staff actually do? What does the foreign employee do? Why does the company's work call for this team structure?
In this case, the company had one Chinese employee. We used business records to explain who did what and why the foreign role was needed.
It Was Approved Before. Why Are More Explanations Needed Now?
The records used for an earlier approval may not fully explain the company as it is today. What work has it done since then? What has it earned? Who works there, and what does the foreign employee do? These points need up-to-date records.
In the cases we came across this year, these details were checked more closely. The records need to show the company's real work clearly, so the reviewer can see how it relates to the role.
For a renewal, we therefore check the company's business, accounts, tax, staff, office and job duties again. We then work out what needs a fuller explanation.
What Did This Company Need to Explain?
The client was already doing international freight forwarding work. The foreign applicant also led the business. The role covered day-to-day management and work to build and maintain ties with clients and suppliers in China and overseas.
For this renewal, several points needed a clear explanation:
- With only one Chinese employee, how were the two people's duties split?
- The use recorded in the Office Rent contract raised questions about the office use. How should the company explain the facts?
- As an investor and business leader, how did the applicant's experience, resources and actual duties show why the role was needed?
- How did the company's business, payroll, social insurance and tax records show its local work and contribution?
We discussed these issues with the client in advance, checked the records and prepared the case around six areas.
Our Recommendation: Six Areas for an Employer Self-Check
Before a new work permit application or renewal, check these six areas using the employer framework at the bottom of the EZIPD Visa tool.
Area — What Should the Company Explain?
① Operating bank activity
Are receipts and payments ongoing, and do they match the business?
② Revenue and tax
Do revenue, accounting, filing and tax payment records match?
③ Payroll and social insurance
What do current staff do, and how does the team support the foreign role?
④ Office and premises
Do the Office Rent contract and actual use support genuine operations?
⑤ Commercial activity
Do clients, suppliers, contracts and delivery records give a clear, joined-up account of the business?
⑥ Need for foreign employment
Why does the business need this role and this foreign professional?
The first five areas explain how the company works. The sixth links the business need to the person.
How Did We Prepare This Case Across the Six Areas?
① Operating Bank Activity: What Business Sits Behind Each Receipt and Payment?
We helped the company put its receipts, payments, contracts, invoices and business records in order. We then checked how they matched.
A freight forwarder needs to explain which services led to its receipts and which suppliers it paid. We also gathered proof of business costs, including rent paid by the company and the related invoices. This linked bank activity to the firm's real work.
② Revenue and Tax: What Had the Business Actually Achieved?
The report set out revenue, business costs, operating and management costs, staff pay, profit and tax already paid. Profit and loss statements, invoices and bank records backed up these figures.
We reviewed these records alongside the real business and helped coordinate checks of the accounts, tax filings and tax paid. The report could then explain what services the firm had provided, what it had earned and what it had spent.
③ Payroll and Social Insurance: Beyond Headcount, Who Actually Does What?
The company had one Chinese employee with ongoing social insurance records. The report explained that this employee handled daily business support. The foreign applicant led the business, developed markets and maintained key client and supplier ties.
This showed the reviewer each person's work and why the business still needed someone to carry out the business leader's duties.
The report also set out a plan to hire one more Chinese employee within three to six months. It clearly set apart current staff and planned hires. The case was based on the real team at the time.
④ Office and Premises: Can the Contract and Actual Use Be Explained Clearly?
The Office Rent contract recorded the premises' use as “hotel.” This raised a question about the firm's use of it as an office. We helped the company explain the existing situation truthfully, with the records to hand. The case was approved after that explanation.
If a similar issue arises, first check the contract, premises and real use. Then check the rules that apply to decide whether more explanation or steps to put things right are needed.
⑤ Commercial Activity: Where Does the Business Come From, and How Is It Carried Out?
The report described the firm's freight forwarding work, its clients and suppliers in China and overseas, and the cross-border logistics services it provided. Contracts, invoices and payment records backed up the account.
This helped the reviewer see where the business came from, how the services were carried out and what the foreign applicant did. The reasons for the hire then had a clear business context.
⑥ Need for Foreign Employment: Why Did the Company Need This Business Leader?
This was the report's main focus. We addressed the following questions.
What did the role actually involve? The report set out the work: leading operations, developing markets in China and overseas, coordinating sales, and managing key client and supplier ties. It linked the title of business leader to real tasks.
What experience did the applicant have, and how did they contribute? The report described the applicant's years of logistics experience in China and direct work to build and maintain client and supplier ties. It also explained why the job called for cross-border negotiation skills, the ability to work in more than one language, and knowledge of overseas business practices and supply chains.
Why was this foreign business leader still needed when the company already had a Chinese employee? The report explained how business support and overall management differed within this team. It then set out why keeping this applicant in the role mattered to the business and its clients.
To answer “Why not hire a Chinese person?”, explain the skills the work needs, the special need for the role and why this person fits it. Being an investor or a foreign national does not replace that explanation.
How Can an Employment Justification Report Make the Company's Situation Clear?
We wrote the report from the company's real records, checked it with the client and used it in the case. It first described the business and how it worked. It then covered the team, the applicant's experience and duties, and why the company needed to keep them in the role. Business records backed up the account.
This also made the firm's local work and contribution clear. Records supported the real business, staff pay, social insurance and tax paid. Further hiring was set out as a plan for growth.
Redacted excerpt from the employment justification report, in the original Chinese. The discussion of operations and staffing is retained; company, personal, city, address and exact financial details are concealed.
Throughout the work, the client supplied real records, explained the business and confirmed the report's contents. We reviewed the issues, prepared the records, wrote the report and followed up on the case.
The Result: A One-Year Work Permit Renewal
The work permit renewal case was not returned with a request for more documents.
- Foreigner's Work Permit: Renewed for one year, November 2026–November 2027.
- Residence permit for work: Also renewed for one year.
The client could continue to plan work and business in China. The case also offers a useful approach for other employers: link the real business, the team's duties and the applicant's work, so the reason for the hire rests on facts.
Frequently Asked Questions
With Only One Chinese Employee, Should a Company Hire Five Before Applying?
First check the local rules for this type of case. Then look at the workload, role and who does what. Here, we prepared the case around the real team of one Chinese employee and completed the renewal. Hire staff because the business needs them, rather than to meet a rumored ratio.
If It Was Approved Before, Do We Need to Prepare a New Business Explanation for Renewal?
We check the firm's current business, accounts, tax, staff and the applicant's duties. This shows which records can still be used and what needs updating. Business records since the first approval often help show why the role is still needed.
Why Explain the Employment Need If the Company Has Revenue and Pays Tax?
Revenue and tax records explain part of the business. The reason for the hire goes further: what work needs to be done, why the role is needed and how the applicant's experience fits it. Look at these records together.
How Should a Company Answer “Why Not Hire a Chinese Person?”
Explain the duties, special need and skills the role calls for, along with the applicant's experience, resources and actual work. Current staff duties give context. Where there are real records of recruitment or a search for staff, include them as the case requires. Nationality alone is not an explanation.
Can the Visa Tool Tell Me That Approval Is Guaranteed?
No. The tool helps you put initial applicant and company details in order and spot issues that need more review. An actual case requires checks of real records. The permit authority makes the decision.
Worried About the Staff Ratio? Start With What Your Company Needs to Explain
Use the EZIPD Visa tool to put applicant and company details in order, then check the six areas at the bottom of the page.
If renewal is due soon, or you have heard different claims about staff numbers or business rules, you can also request a confidential review. Tell us about the firm's current business, team, the applicant's duties and when the current permit expires. We will first check what needs to be resolved, then explain the work to prepare, service scope and next steps. You do not need to send full bank statements or passport documents for the first discussion.
You can also read our work visa consultation scope for founders and employers, or the work visa and business preparation guide for foreign business owners.