Please see below our latest issue of Onboard, Links International’s quarterly update that keeps you aware of significant payroll and visa developments across the region.
Chief Executive delivers 2017 Policy Address
At the start of the year, the Chief Executive delivered his last Policy Address for his five-year term. The highlights included: the cancellation of the MPF offsetting mechanism; optimising the multi-tiered social security pillar and retirement protection; and the increase of minimum wage to HK$34.5 per hour.
MPF schemes to offer Default Investment Strategy
From 1 April 2017, each of the existing 32 Mandatory Provident Fund (MPF) schemes in Hong Kong will have to offer the Default Investment Strategy (DIS). This aims to provide scheme members with better retirement protection, as it standardises the default arrangements of the MPF schemes and also addresses the concerns about the high fee levels of MPF funds, as well as scheme members’ difficulties in making fund choices.
Pilot implementation scheme of Foreigner’s Work Permit
China’s State Administration of Foreign Experts Affairs (SAFEA) has decided to carry out a pilot program for the new Foreigner’s Work Permit in selected Chinese provinces from October 2016 to March 2017, before implementing it in the entire country.
The establishment of Singapore’s Employment Claims Tribunal
From April 2017, the Employment Claims Tribunal (ECT) and the Tripartite Alliance for Dispute Management (TADM) will be set up to provide employers and employees with a way to expeditiously resolve salary-related disputes between employers and employees.
FSS reminds employers to pay new amount of contributions from February
Macau’s Social Security Fund (FSS) reminds employers that the contribution amount was increased from MOP45 to MOP90 on 1 January 2017. From February 2017, employers are required to pay the new amount of contributions for their casual workers.
New regulation to prevent exploitation of overseas workers
A new law effective from 1 January means Malaysian organisations hiring migrants must now pay the foreign workers levy themselves, rather than deducting it from employees’ wages. The aim is to prevent abuse of foreign workers, who can be subject to human trafficking.
Adjustment of basic wages
Effective 1 January 2017, the monthly basic wage has been adjusted from NT$20,008 to NT$21,009 – a 5% increase. Adjustments to the hourly basic wage will come into effect in two phases: the first phase, which increased the hourly wage to NT$126, began on 1 October 2016; and the second phase, which will see an increase to NT$133 per hour.
Amendments to “Five-Day Work Week”
The President of Taiwan has announced amendments of the Labor Standards Act with regards to the five-day work week. These include items such as employers having to provide employees with wage calculation details when paying wages; obligatory rest intervals of at least 11 hours between shifts for workers on rotation; increased wages for duties performed on rest days; and improved worker rights to annual paid leave.
South Korea to launch talent-based immigration system
South Korea’s Deputy Prime Minister Yoo Il-ho has confirmed that the Office for Government Policy (OPC) has created a task force to counter the country’s demographic changes, and plans to produce mid- and long-term immigration policies in the first half of the year.
Extended IRP eligibility in Korea
The Korean Ministry of Employment and Labor (MOEL) has pre-announced the extension of the scope of people eligible to join an individual retirement pension (IRP) starting on 26 July 2017. The amendment to the Enforcement Decree would include in the scope of those eligible to join an IRP people who have been denied access to IRPs in the past, such as workers covered by the retirement allowance system, workers for whom no retirement benefit scheme is set up, and occupational pension holders.
Region-based minimum salary increased
The region-based minimum salary for those who work under labour contracts has been increased by between 7.1% and 7.5% effective 1 January 2017.
Minimum basic salary to increase from 1 July 2017
The National Assembly has approved the Resolution on State budget estimates for 2017, which will see the basic salary increase up to VND1,300,000/month, with effect from 1 July 2017.
Revision of Personal Income Tax structure
With effect from 1 January 2017, Thailand’s Personal Income Tax structure has been revised. The revisions include: expense allowance for taxable income increased to 50% of assessable income not exceeding THB100,000; personal allowance increased to THB60,000; non-working spouse allowance increased to THB60,000; child allowance increased to THB30,000 per child; and education expenses cancelled.
Adjustment of Protected Earnings Amount
The rate for Protected Earnings Amount (PEA) has been adjusted effective 1 January to AUD358.05 per week; AUD716.10 per fortnight; AUD1432.20 per four-week period; and AUD1556.88 per monthly period.
Tax rules to change for Temporary Working Holiday makers
Effective 1 January 2017, employees on a Working Holiday will be taxed at 19% on earnings up to AUD37,000, after which ordinary marginal tax rates will apply. They will no longer be entitled to claim the tax free threshold.
Minimum wage to increase
New Zealand’s minimum wage will increase by 50 cents to NZ$15.75 per hour, from 1 April 2017. The starting-out and training hourly minimum wage rates will increase from NZ$12.20 to NZ$12.60 per hour, remaining at 80% of the adult minimum wage.
April 2017 tax changes
The maximum liable earnings for the ACC Earner levy will increase from NZ$122,063 to NZ$124,053 for all pay periods ending on or after 1 April 2017. Any income above NZ$124,053 will not be subject to the ACC Earner Levy.
Schedular payment changes
From 1 April 2017, contractors, with their payer’s agreement, may voluntarily elect to have payments made to them considered a schedular payment and elect their own rate of withholding. If no rate is specified then a standard rate of 20 cents in the dollar will be applied.
Japan tries to lure global talent
Japan is considering “significantly” shortening the requirement time for highly skilled foreign professionals to apply for permanent residency, in a move to help lure more global talent to Japan. If the timeframe is reduced, the Japanese system will be one of the fastest systems to issue “green cards” to top-level professionals.
Japanese government proposes cap on overtime
The Japanese government is looking to force businesses to limit overtime to a total of 60 hours per calendar month in an effort to combat the widespread practice of overly long shifts. The current limit is 45 hours per month, but this can be, and often is, sidestepped.
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