The reason of discussing the influences of Law of the PRC on Employment Contracts is, pursuing the economical growth has been the main development policy from the beginning of the reforming and opening up of China. However, the derivative labour problems are getting worse. Although the PRC government passed the Labour Law of the People's Republic of China in 1995, the execution of the Law achieved little, resulting in more labour-management problems instead. For this purpose, the PRC government passed the Law of the People's Republic of China on Employment Contracts in 2007, expecting to eliminate the situation of long-term ignorance and violation of labour rights. The Law has great influences on employers in China such as decreased employing flexibility and increased operating costs. Therefore, this research intends to comprehend the influencing coverage of the Law of the PRC on Employment Contracts through investigating the Law¡¦s legislative background and its legal meaning, and adjusting future human resource systems and positioning human resource management strategies for the enterprises according to their influenced coverage. During the research process, I have consulted a large quantity of documents related to the Law and news regarding enterprises¡¦ reaction toward it. Through collecting, analyzing related documents, and interviewing cases, I found that the Law insists much on recording and reserving anything regarding labour rights in written form during the operating processes of enterprises. Besides, other influences toward enterprises including the changing of cost structures, especially the law violation costs. For example, enterprises do not have probation period, dismissing employees illegally, or the expending of economical compensation and so forth. In addition, I also found that the regulation of the open-ended employment contracts and granting the economical compensation influence enterprises fairly much. However, the two above regulations are complements of each other. The purpose of the legislation is to let enterprises and employees built long-term and stable labour-management relations. At last, I discovered that in the future, enterprises need to change the passed attitude of dealing with labour-management relations when facing the Law. They have to pay more attention on details when operating company, especially when dealing with affairs about labour rights. For example, they have to notice the details of the design of appraisal system, improving staff training, modifying the company¡¦s rules and regulations, and the new employee recruitment and so forth. To conclude, in the future, enterprises have to take a more reciprocal attitude when facing labours and managing labour relations.