- Country Information
- Hongkong SAR (China)
In this article...
Hongkong SAR (China)
- What are the mandatory employer burdens in Hong Kong?
- What are the public holidays in Hong Kong for 2025?
- Horizons Payroll Calendar - Hong Kong SAR (China) 2025
- How as annual leave regulated in Hong Kong?
- How is sick leave regulated in Hong Kong?
- What is the notice period for employment termination in Hong Kong?
- What is the standard employment agreement Horizons offers in Hong Kong?
- Can a client have a Hong Kong entity and still use Horizons to employ an employee in Hong Kong?
- What is the recommended work setup for EOR employees in Hong Kong?
- What is the standard probation period in Hong Kong?
- Can Horizons offer part-time employment agreements in Hong Kong?
- What are the paid and unpaid leaves in Hong Kong?
- How is accrued leave handled and carried over in Hong Kong?
- How are annual leaves accrued in Hong Kong?
- What are the allowances employers can offer employees in Hong Kong?
- How is salary payment structured in Hong Kong?
- What is the minimum wage in Hong Kong in 2025?
- Is there a statutory year-end bonus in Hong Kong?
- Which employees are protected from termination in Hong Kong?
What are the mandatory employer burdens in Hong Kong?
In Hong Kong, employers are required to fulfill several legal obligations to ensure compliance with labor laws. These obligations are in place to protect employees' financial well-being and their rights in the workplace. The key mandatory employer burdens are:
1. Mandatory Provident Fund (MPF)
The MPF is a retirement protection system established by the Hong Kong government. Both employers and employees are required to contribute to the MPF scheme, ensuring basic economic security for employees after they retire. Employers must register their employees for this scheme, and failure to do so can result in criminal liability and fines.
2. Employees' Compensation Insurance
Employers must purchase employees' compensation insurance, which covers work-related accidents. This is mandatory under the Employees' Compensation Ordinance. Employers who fail to secure this insurance face fines and are legally liable to compensate employees in case of work-related injuries.
Who is Entitled to These Employer Burdens?
Mandatory Provident Fund (MPF)
All employees between the ages of 18 and 65 are required to participate in the MPF scheme, unless exempted by specific laws. Once an employee reaches 65, they can withdraw their contributions. Employers must ensure their employees are registered for the MPF, or they risk facing penalties.
Employees' Compensation Insurance
This applies to all full-time or part-time employees working under an employment contract or apprenticeship training contract. This includes domestic helpers, agricultural workers, and seafarers working on registered vessels in Hong Kong.
How Much is the Monthly Contribution to the MPF?
The MPF consists of both mandatory and voluntary contributions:
Mandatory Contributions
Employees are required to contribute 5% of their relevant income to their MPF accounts, subject to a minimum and maximum income threshold.Minimum salary: HK$7,100
Maximum salary: HK$30,000
Therefore, the employer's monthly contribution will be between HK$355 and HK$1,500.
Voluntary Contributions
Employers and employees can make additional voluntary contributions. These contributions allow for more flexibility in retirement planning and are agreed upon in the employment contract. There is no upper limit on voluntary contributions, offering employees enhanced flexibility in saving for retirement.
Additional Details About MPF Contributions and the "Contribution Holiday"
According to the MPF Authority (MPFA), there is a "Contribution Holiday" that applies to the mandatory contributions (MC). However, voluntary contributions (VC) are not subject to this holiday.
When an employee joins the company, the first MPF contribution will be included in the payroll report in the month following 30 days of employment. For example:
If an employee’s employment begins on June 5, they are entitled to a 30-day contribution holiday for mandatory contributions from June 5 to July 4.
The contributions will then be withheld and included in the August payroll.
Both employer and employee contributions must be deposited before the due date required by the MPFA.
What is the Premium for Employees' Compensation Insurance?
The premium for employees' compensation insurance is calculated at approximately 0.422% of the employee’s earnings. The premium is invoiced at the beginning of the insurance period, and any adjustments (refunds or additional payments) are made based on actual circumstances.
These employer burdens are crucial to ensuring compliance with Hong Kong's labor laws and safeguarding employee welfare.
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