Employee Entitlements and Common Staff Benefits in Hong Kong
Hong Kong's Employment Ordinance is legislation that governs the terms and conditions of all workers in the HKSAR. Basic wage protection and statutory holidays apply to all employees, but employees under continuous contracts enjoy additional benefits. An employee who has worked for an employer for at least four weeks with at least 18 hours worked each week is viewed as a continuous contract of employment.
In addition to mandatory benefits, there are also a few benefits and standard cultural practices employees are used to, such as a 13th salary and a lai see on the Chinese New Year. But let's first go over those found in Hong Kong employment law.
Leave Entitlements
Employees in Hong Kong are entitled to several types of paid leave. During the leave, an employee typically receives full or partial compensation based on their average daily wage.
Overtime is also considered a part of the average wage if its monthly average makes up for at least 20% of the average wage. Note that there's no limit on work hours, and overtime is relatively common.
Rest Days
Employees are entitled to at least one rest day in every period of 7 days, and whether it's a paid rest day is agreed upon beforehand. Employers can substitute one rest day for the original within 30 days or the same month if the employee agrees.
Employers can't ask the employee to come to work on a rest day, the only exception being unforeseen emergencies. If the employer fails to grant rest days or demands that employees work, the employer could receive a fine of up to HK$50,000 if convicted. However, workers can work voluntarily on a rest day.
Public Holidays
All employees are entitled to statutory holidays. Workers who have been employed under a continuous contract for at least three months will be paid their average daily wage. If the employer requires the employee to work, they must give at least 48 hours prior notice and arrange an alternative holiday within 30 days before or after the public holiday.
Here is the complete list of statutory holidays:
First day of January
Lunar New Year’s Day
Second day of Lunar New Year
Third day of Lunar New Year
Ching Ming Festival
Labour Day (1st May)
Birthday of the Buddha
Tuen Ng Festival
Hong Kong SAR Establishment Day (1st July)
Day following the Chinese Mid-Autumn Festival
Chung Yeung Festival
National Day (1st October)
Chinese Winter Solstice Festival or Christmas Day
Several new statutory holidays will be added over the next few years:
The first weekday after Christmas Day (2024)
Easter Monday (2026)
Good Friday (2028)
The day following Good Friday (2030)
While the above holidays are not yet statutory holidays, it is nonetheless customary to grant paid leave to staff on these days.
Annual Leave
An employee under a continuous contract is eligible for paid annual leave after 12 months. The first annual leave starts at seven days and progressively increases by a day for each year served, up to a maximum of 14 days after nine years. In practice, employees with office jobs often get 15 to 20 days of paid annual leave.
Statutory holidays that fall within the annual leave are counted as annual leave, and the employer must appoint a different rest day or holiday. If the employee is terminated, they're still entitled to payment in lieu of the leave.
An employer who doesn't grant annual leave or fails to pay the worker will be fined up to HK$50,000.
Sick Leave
Employees accumulate two paid sickness days each month for the first 12 months. After that, they accumulate four paid sick days per month, up to a maximum of 120 days of sick leave.
The payment for a sick day equals 80% of the average daily wage of the preceding 12 months.
The sick leave must be at least four consecutive days and verified with a medical certificate unless it's compliance with anti-epidemic movement restrictions.
An employer who fails to pay the employee could receive a fine of up to HK$50,000.
Maternity/Paternity Leave
Maternity leave for pregnant employees is 14 weeks. The employee is eligible for maternity leave after notifying the employer and working for at least 40 weeks before the scheduled maternity leave. Maternity leave can be extended for longer than 14 weeks if labour/confinement is late or if the pregnancy or labour cause an illness or disability.
Maternity leave is paid 80% of the average daily wage of the preceding 12 months. Weeks 11th to 14th are capped at HK$80,000. Employers can apply to the Hong Kong Government to be reimbursed for those last four weeks of maternity leave.
Paternity leave for men lasts five days and is paid 80% of the average daily wage. To be eligible, the employee must be under a continuous contract for at least 40 weeks and provide prior notice at least three months before the expected date of childbirth. However, the employee can choose any period for paternity leave, starting four weeks before delivery and up until the 14th week. They can take the five days off continuously or separately.
The employer can request additional documentation or a written statement before granting maternity or paternity leave. Employers who fail to comply can get fined up to HK$50,000.
Retirement (MPF) Contributions
The Mandatory Provident Fund (MPF) is a compulsory retirement savings scheme that both employers and employees must contribute to. Some are exempt from the MPF as defined under the Mandatory Provident Fund Schemes Ordinance (MPFSO), such as people who already receive a statutory pension and non-citizens who have been employed for less than 13 months.
Employees who earn more than HK$7,100 per month must contribute 5% of their salary. Employers have to contribute a minimum of 5% regardless of the employee's earnings, up to a maximum of HK$1,500 per month.
Severance and Long Service Payment
An employee under a continuous contract for 24 months who was laid off or made redundant is eligible for severance pay.
For long service payments, the employee must have been with the company for at least five years. Long service payment usually ensues when the contract ends and doesn't get renewed, but a few other conditions include the employee's death, ill health, or retirement (if aged 65+).
Common Employee Benefits That Aren’t Required by Law
In addition to law-regulated benefits, there's also a long list of staff benefits tied to Hong Kong's customs and culture. Note that none of these are required by law, but some might still be regulated to an extent. Here are a few of the most common ones:
Medical Insurance
Both Hong Kong natives and expats with employment visas are used to receiving some form of medical insurance. The exact coverage varies based on company policies. Most employers offer insurance in the form of inpatient services, such as hospital stays. Some also provide partial or full reimbursement for outpatient visits.
Due to long wait times, the public healthcare system isn't ideal for outpatient visits. That's why some employers opt for premium health insurance providers that offer basic medical coverage that can include family protection as well as vision and dental coverage.
13th Month Pay
Also called a "13th salary," this payment is seen as a bonus and is customarily distributed in December or before the Chinese New Year. Many employees save their 13th salary for the tax season.
Lai See on the Chinese New Year
It's customary for employers to hand out Lai see to their employees on Chinese New Year. The amount of cash varies, but employers are usually expected to hand out a more generous red envelope than what one may receive from their family or close friends.
Group Life Insurance
Corporate life insurance plans are a common perk of office jobs. Life insurance is paid out in the event that an employee dies. Employers normally pay for the base coverage, and employees have the option to purchase additional coverage.
Training & Professional Development
Employers like to support their workers in self-improvement, as both parties can benefit from it. One example is additional paid time off to pursue certifications, such as the Certified Public Accountant (CPA) certification.
Some sectors have professional organisations that aim to provide training and education in the industry. Employers can arrange paid memberships for their employees to join such organisations or enrol in their programs.
In certain circumstances, an employer might finance an employee's degree, such as a master's degree. This is a significant benefit, as some master's programs cost over HK$200,000 over two years.
Special Benefits for Senior Staff Members
Managers, directors, supervisors, and other senior staff members can expect even more benefits. This includes but isn't limited to everything mentioned above, along with some of the following benefits:
Recreational Benefits
Employers incentivise recreation for employees' health and well-being in the form of club memberships. This includes golf and sports clubs, gyms, spas, and wellness workshops.
Private School Fees
International school tuition in Hong Kong is a common perk for senior foreign staff members who wish to enrol their children where classes are held in English and to follow their home country's curriculum or schooling system.
Air Travel
Another benefit specific to senior foreign staff is free air travel tickets, which often encompass the employee's whole family. This is usually an annual trip to their home country.
Additional Perks
Other potential benefits for expats with Hong Kong work visas include legal and language support and help with cultural adaptation.
Closing Remarks
With the Employment Ordinance, both employees and employers in Hong Kong have a clear picture of what's expected regarding benefits and compensation. The legislation protects both parties, depending on the circumstances.
Beyond legally mandated benefits, Hong Kong's work culture includes many customary benefits, especially if it's an office job or senior staff position.
