All business activities, no matter whether negotiation, production or marketing, have to be carried out by people in a business organization. People are, therefore, valuable assets or human resources, and should be properly managed. Human resource management is about how to use human resources effectively and efficiently in an organization. As people are different from machines or products, in the sense that they can think and feel, managing people is probably the most difficult task that a company undertakes. HRM has to deal with many complex issues, such as how to recruit employees, how to retain them and how to motivate them. The complexity of these issues is exacerbated in an international setting, where a company has to manage human resources in an environment different from that at home. A transnational corporation needs to learn how to manage its human resources efficiently and effectively in the different countries in which it operates. The aim of this chapter is to analyse the main challenges faced by TNCs in human resource management in China, and the various approaches to dealing with these challenges.