When Death or Shi sends someone to the afterlife, they get sent to one of 2 planes, the Holy Plane, and the Unholy Plane. (Basically Heaven and Hell.) All of your virtues and sins are added up to decide where you go. If your good deeds outweigh the bad ones, you go to the Holy Plane, and vice versa, or if you study something like unholy sorcery or committed murder, you go to the Unholy Plane.
The spirits who live in the Unholy Plane are demons, while the ones in the Holy Plane are angels. The Demons punishment is they must serve the Angels and do what they want. If they don't, and disobey them, the Angels are allowed to punish them, with certain limits of course. exceeding the punishmental limit results in an Angel being turned into a Demon, and having to work for other Angels.
The Holy Plane is a large, beautiful, and peaceful city, with thriving wildlife and civilization.
The Unholy Plane is also a large city, but it is dirty and filled with evil people. The wildlife is aggressive, and the supplies are somewhat scarce.
Depending on their sins, if Demons serve certain amounts of time, and if they behave, they may be able to leave the Unholy Plane behind and become Angels.
Chicken.