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Human Resources

Labor laws

The Employment Ordinance is the main piece of legislation governing conditions of employment in Hong Kong. Since its enactment in 1968, the benefits provided for under the Ordinance have been substantially improved. It now covers a comprehensive range of employment protection and benefits for employees including: (a) Wage protection, (b) Rest days, (c) Holidays with pay, (d)Paid annual leave, (e) Sickness allowance, (f) Maternity protection, (g) Statutory paternity leave, (h) Severance payment, (i) Long service payment, (j) Employment protection, (k) Termination of employment contract and (i) Protection against anti-union discrimination.

With very limited exceptions, the Employment Ordinance is applicable to all employees in Hong Kong, whether they are domestic or foreign workers.

To gain more insights about labor laws, read this section

Hiring employees

Hiring employees in Hong Kong must comply with the region’s key labor legislations, especially the Employment Ordinance, which is the main piece of legislation governing conditions of employment in Hong Kong. The Employment Ordinance highlights employees’ rights as well as duties and responsibilities of employers and employees.

In Hong Kong, the Employment Act separates employees into two categories, which are:

  • Employees employed under a continuous employment contact (entitled to all the statutory benefits under the Employment Ordinance); and
  • Employees employed under an employment contract (entitled to basic protection under the Employment Ordinance).

[tips title="Important Tip"]An employee who has been employed continuously by the same employer for four weeks or more, with at least 18 hours worked in each week is regarded as being employed under a continuous contract.[/tips]

Read our 'Guide to Hiring Employees in Hong Kong' for more information.

Salary and wages

The Minimum Wage Ordinance of Hong Kong establishes a statutory minimum wage (SMW) regime aimed at striking an appropriate balance between forestalling excessively low wages and minimising the loss of low-paid jobs while sustaining Hong Kong’s economic growth and competitiveness. SMW provides a wage floor to protect grassroots employees.

The Statutory Minimum Wage (SMW) has been in effect since May 1, 2011. The SMW fee has been increased to $37.5 per hour as of May 1, 2019. Similarly, the monthly monetary cap on the need that companies keep records of the total number of hours worked by employees is raised to $15,300.

To know more about minimum wages in Hong Kong, click here.

Visa and employment permits

Generally, a visa or entry permit is required to work, study, establish or join in any business or to take up residence in the HKSAR. Otherwise, there is high risk of being refused admission on arrival.

Hong Kong offers a visitor’s visa grants a visa free period for citizens of most countries, usually for a length of 7, 14, 30 or 90 days depending on the country in question. For Employment and investment, Hong Kong has several different types of visa for investment, including visa under the General Employment Policy (GEP), visa under the Admission Scheme for Mainland Talents and Professionals (ASMTP), visa under Immigration Arrangements for Non-local Graduates (IANG), visa under Admission Scheme for the Second Generation of Chinese Hong Kong Permanent Residents, and visa under Capital Investment Entrant Scheme (CIES).

However, if an individual holds certain travel documents, no visa or entry permit shall be required for any purpose. Read our article about visa and employments permits to know about these documents.

Terminating employees

The Employment Ordinances (EO) (Cap.57) govern employment law in Hong Kong, allowing both the employer and the employee to terminate a contract of employment. The party terminating the contract must provide the other party with a reasonable notice period or payment in lieu of notice, among other requirements.

Although dismissing employees in Hong Kong is easier than in other jurisdictions such as mainland China, the United Kingdom, or the United States, employers must follow all applicable statutory requirements as well as any special contractual stipulations. They should also be aware of the implied requirement of mutual trust and confidence wherever possible, so as not to jeopardize the parties' relationship.

Read our Guide to Terminating Employees in Hong Kong for detailed insights.

Payroll

Employers in Hong Kong are not required to withhold income tax from their employees, but they are required to withhold social security contributions as part of their payroll and report that money to the Inland Revenue Department.

Statutory holidays

Hong Kong has some Western holidays in addition to holidays more or less matching most of China’s official holidays. It currently has 12 statutory holidays (also called labor holidays or factory holidays) and 17 public holidays (also called bank holidays). But, starting from 2022, the number of statutory holidays will gradually increase to 17, by 2030 (one additional holiday to be added every two years). The five new days off will be Buddha’s Birthday, the first weekday after Christmas Day, Easter Monday, Good Friday, and the day following Good Friday.

Check out the list of statutory holidays in this section.

Social Insurance

The Mandatory Provident Fund (MPF) is a retirement scheme introduced on December 1, 2000. This scheme covers all employees aged over 18 and under 65 with exemptions. An employer must comply with all MPF-related legal obligations under the law. These include enrolling all qualifying employees in MPF schemes and making MPF contributions for them. Employers and employees must both contribute five percent of the employee’s relevant income to the MFP, subject to the minimum and maximum relevant income levels.

Read more about social insurance in Hong Kong.

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