Since China''s reform and opening up started from 1978, With China''s rapid economic development and in line with the nature of the socialist market economy, in July 1994 the NPC Standing Committees established the "Labor Law of the People''s Republic of China" confirmed that a relevant labor contract system under the socialist market economic system, which become effective in January 1995. Because investment cost of Taiwan is rising, esulting in many labor-intensive industries have to set up factories in China. In recent years, there are more and more Taiwanese Enterprise invest in China.
As a result of speeding up of industrialization, urbanization and economic structure reconstruction, enterprise system reforms constantly; business forms and labor relations diversified gradually, the labor relations face many new problems. Therefore, in June 29, 2007, the "Law of Employment Contracts" was approved in the 28th meeting of the Tenth National People''s Congress Standing Committee, and come to effect in January 1, 2008.
"Law of Employment Contracts" not only establishes the norms of labor relations, this legislation could have a strict standard on many aspects, such as, to conclude a labor contract, the duration of labor contracts, the norms of the probationary period, termination of labor contracts and the economic compensation system. but makes enormous influence on Taiwanese Enterprise setting aside the social insurance funds, managing their cost control and human resources, as well as their overall business strategy. So this study will explore the "Law of Employment Contracts" the legislative background, and compare the difference of the "Labor Law" and the "Law of Employment Contracts". Further explore the "Law of Employment Contracts" on the labor cost and the impact of human resource management, and analyze the possible solutions when Taiwanese Enterprise confront the "Law of Employment Contracts" and make overall armaments.
To face "Law of Employment Contracts", Taiwanese Enterprise should attach importance and take the right ways of coping, according to the "Law of Employment Contracts" in line with the development of the labor contract、regulations、appraisal records, and improve the operation and management that can make Taiwanese Enterprise get the advantages of sustainable development in the competition of Chinese market.