The punishment of criminals in China is carried out strictly according to the law, from the day they are taken into custody to the day of their release at the end of their sentence.

Criminals are handed over to reform-through-labour institutions only after the court verdict legally goes into effect. The reform-through-labour institutions have the right to refuse to detain criminals when the related legal documents are found to be deficient or when the verdicts have not yet become legal. Doctors must be on hand when new prisoners arrive to give them physical check-ups. Those who are suffering from mental illnesses; from acute, pernicious or contagious diseases; or from any serious illness, requiring treatment outside the prison on bail plus women who are pregnant or breast-feeding their babies are not taken into prison. Within three days after a criminal is incarcerated, members of his or her family must be notified so that they promptly learn of his or her whereabouts. In compliance with legal provisions concerning prison management, most criminals are allowed to serve their sentences in the area around their original residence, making it convenient for their family members to visit them and for their former work units to assist in educating them.

According to Chinese law, the reform-through-labour institutions must not only immediately pass on a prisoner's appeal to the department concerned at any time during the term of imprisonment, but also conduct their own analysis and study of the appeal. When the institution disagrees with a judgment, the institution itself may request the People's Procuratorate or the People's Court which made the original judgment to reexamine the case.

In order to foster the desire to reform among prisoners, Chinese law contains provisions stipulating a system for reducing sentences and release on parole. All prisoners who qualify, accept reform, and show true repentance or outstanding behaviour during their prison terms may be granted a reduction in their sentence or release on parole in accordance with the law. Since the early 1980s', a system of points has been generally adopted by all Chinese reform-through-labour institutions for assessment and determination of reward and punishment, wherein day-to-day behaviour of the prisoners as they undergo reform is translated into points. On the basis of a fixed number of points, those who show a positive attitude towards reform will be awarded additional points and those who show indiscipline or break regulations will have points deducted, with results of additions and deductions of points made public every month. Prisoners have the right to question or protest their scores. In accordance with the law, the reform-through-labour institutions regularly or from time to time recommend to the People's Court that selected prisoners have their sentences reduced or be released on parole, based on their overall conduct while undergoing reform. From the results of assessment and the published scores, the prisoners themselves are aware of the chances for having their sentence reduced or being released on parole. To ensure fair and rational rewards and penalties, strict regulations govern the procedures for reduction of sentence or release on parole. This method of assessment and reward and penalty greatly increases prisoners' desire to reform. According to statistics, in 1990 16.38% of all the imprisoned criminals in the whole country had their sentences commuted or were released on parole, and in 1991 the figure was 18.35%.

In order to reform those criminals who have committed crimes punishable by death but who may still be reformable, China has created a unique system of a death penalty with a two-year reprieve. Article 43 of the Criminal Law of the People's Republic of China stipulates that, "the death penalty is only applicable to criminals who have committed the most heinous of crimes. Criminals who should receive the death penalty but need not be executed immediately can be sentenced to death with a two-year reprieve, during which time they are to undergo reform through labour to see if it will be effective." In keeping with provisions of the criminal law, if a criminal sentenced to death with a two-year reprieve shows genuine regret for his or her crimes during the probationary period, the sentence can be commuted to life imprisonment upon completion of the two-year reprieve. Those who have shown true repentance and exemplary behaviour can have their sentences reduced to a set term of imprisonment between 15-20 years. In actual judicial practice, over 99% of criminals given the death penalty with two years reprieve have had their sentences commuted to life imprisonment or set terms of imprisonment through reform. Those who have had their sentences reduced to life imprisonment can have their sentences further commuted to a set term of imprisonment if they show repentance and exemplary behaviour during prison service.

For criminals who have committed new crimes in the prison or reform-through-labour institution, violating criminal law, the People's Court, in accordance with the law, is petitioned to pass sentence for the new crimes, to be added to the remaining term of imprisonment for the old crimes. As the overwhelming majority of criminals want to reform, only a handful of prisoners have been given additional penalties due to new crimes. According to statistics, only 0.387% of the total number of criminals in custody in the country were given increased sentences because of new crimes committed in prison in 1990 and only 0.319% in 1991.

For a female criminal who is pregnant or breast-feeding her baby, or a criminal who is seriously ill, the People's Court may sentence the prisoner to serve his or her term outside of prison. Release on parole for medical treatment is also granted to all seriously ill prisoners, who are serving either a set term or life imprisonment. Requirements for being released on parole for medical treatment are more flexible for juvenile, elderly and female prisoners. Statistics show that 1.91% of the prisoners in the country were released on parole for medical treatment in 1990 and 1.94% in 1991.

A reform-through-labour institution needs to do a certain amount of preparatory work before a prisoner is to be released, since a prisoner must be released in accordance with the law on the day the term of imprisonment ends. At the time of release, a prisoner is given enough money to cover travel and food expenses. If a prisoner to be released is not well, family members are informed ahead of time to come and take him home, or the reform-through-labour institution assigns people from its staff to accompany him to his home.

To help reform criminals, China, like most other countries in the world, suspends sentence for criminals who have committed a minor crime, have pleaded guilty and are not likely to further endanger society. In the past few years, the departments of justice have appropriately expanded the scope for sentence suspension according to law. In 1991, over 65,000 criminals had their sentence suspended. Judicial experience shows that giving criminals suspended sentences allows them to stay with their families, keep their jobs and remain in a normal social environment. This helps stimulate their enthusiasm for receiving reform and contributes to their reform through education and persuasion by society at large.