Refuse job deposits, document confiscation, training loans, pyramid schemes, and predatory borrowing
An employer cannot keep your identity card, demand a deposit, or collect money under another label. An employment agency that fails to arrange a job must refund the placement fee. Chinese authorities specifically warn about recruitment used to sell training loans and schemes paying for recruiting more people. Courts do not protect private-loan interest above four times the one-year loan prime rate at contract formation, but the principal remains repayable.
What it takes
No payment is needed. Reject “pay before starting,” “borrow for training before we place you,” and recruitment-based earnings schemes. Save messages and transfer records. When money is tight, the hope of a quick solution can make saying no particularly difficult.
What you may gain
Employers may not confiscate identity documents, demand a guarantor, or collect money or property under another name. Violations can lead to return orders and fines of RMB 500–2,000 per person. Employment agencies likewise may not hold documents or deposits and must refund placement fees when placement fails. Recruitment that turns into paid training or a training loan has been specifically identified as a risk by the human-resources ministry and four other departments. Schemes based on recruiting people for commissions or paying to join fall within China’s prohibited pyramid-selling framework; participants may face fines of up to RMB 2,000. For private lending, the portion of interest above four times the one-year LPR when the contract is made is not judicially protected. This framework, introduced in August 2020, replaced the former three-tier approach based on 24% and 36% annual rates.
Context & considerations
Four times LPR is an interest-protection ceiling, not permission to keep borrowed principal. The judicial interpretation was amended again in December 2020 and article numbering changed; use the current text. Urgent need makes these schemes especially tempting. Start with the legitimate channels earlier in this chapter: unemployment benefits, wage complaints, legal aid, relief stations, and temporary assistance.
Research & references
Standing Committee of the National People’s Congress (2007). Labor Contract Law, Presidential Order 65, Articles 9 and 84. https://www.gov.cn/gongbao/content/2007/content_711013.htm; Ministry of Labor and Social Security (2007). Employment Service and Employment Management Provisions, Order 28, Articles 14, 55, and 58. https://www.gov.cn/zhengce/2022-11/28/content_5711307.htm; Ministry of Human Resources and Social Security and four other departments (2026). Warning about recruitment-to-training and training-loan risks. https://chinajob.mohrss.gov.cn/h5/c/2026-05-18/543038.shtml; State Council (2005). Regulations Prohibiting Pyramid Selling, Order 444, Articles 2, 7, and 24. https://www.gov.cn/gongbao/content/2005/content_80604.htm; Supreme People’s Court (2020). Amendment to the judicial interpretation on private-lending disputes, Judicial Interpretation 2020 No. 6, Article 26. https://www.court.gov.cn/fabu/xiangqing/249031.html; Supreme People’s Court (2020). Judicially protected private-lending interest ceiling adjusted to four times the one-year LPR. https://www.court.gov.cn/zixun/xiangqing/249051.html.