There has been a marked increase in labor disputes, Liu said.

The labor dispute arbitration committee in Chaoyang received 14 cases from October 2010 to October 2011. The number surged to 75 from October 2011 to July this year.

"More foreigners are turning to the law to protect their labor rights. It shows that the law is working and that they are willing to live in China for a considerable time, otherwise, the lawsuit-after-arbitration procedure is not cost effective," she said.

"Requiring foreigners to obtain a work permit is compulsory and it offers legal guarantees."

WangWenjie, who works in the human resources department at a Shanghai company, said the policy will probably affect foreigners working in small-scale companies as larger companies will have the resources to do the paperwork.

About the broadcaster:

CJ Henderson is a foreign expert for China Daily's online culture department. CJ is a graduate of the University of Sydney where she completed a Bachelors degree in Media and Communications, Government and International Relations, and American Studies. CJ has four years of experience working across media platforms, including work for 21st Century Newspapers in Beijing, and a variety of media in Australia and the US.

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