Voted the worlds freest economy for consecutive years, Hong Kong is where ‘East meets West’ and is a great place to start a business in the Asia-Pacific region for numerous reasons – including tax benefits, ease of expansion, free market and business friendly law and policies.
Looking to expand or start a new venture in Hong Kong? Links International has compiled a guide for you that includes employment laws and best practices you are required to follow when operating a business in Hong Kong.
Please note that all the information listed below are to be used as a general guideline. For more detailed accounts of Hong Kong employment laws and regulations, please visit the official governmental websites.
No. of employees | Amount of Insurance Cover per Event |
Not more than 200 | Not less than HK$100 million |
More than 200 | Not less than HK$200 million |
Hong Kong is a FinTech hub, popular for professionals looking to grow their careers. Applicants who have an impressive educational background and carries skills, knowledge and experience of value usually stand out. The process time for each of these visas range from between 4 weeks – 6 weeks from the date of submission of application. Upon approval, the applicant has the right to abode in Hong Kong and will be required to then apply for a resident Hong Kong Identity card to live and work in the city.
General Employment Policy (GEP) / Admission Scheme for Mainland Talents and Professionals (ASMTP) / Change of Sponsorship:
Person is required to be admitted to or working in a valid managerial, executive, or specialized position qualifying the lack of local talent in Hong Kong.
Top Tier Visa:
Person carrying total taxable income of HK$2M yearly receives approval for 6-year visa with continuation from a 2-year employment visa.
Dependent Visa:
Legally married spouse or unmarried children under the age of 18 of eligible visa holders or permanent residents of Hong Kong are entitled to a dependent visa.
Training Visa:
Designed for people required to enter Hong Kong for training in skills related to their field of work.
Top Talent Pass Scheme:
Person who has graduated from the world’s top universities and high-income talent earners are eligible for the TTPS. They can enter Hong Kong without securing an offer of employment upon application.
Considerations for visa approval for each applicant include:
Looking for an efficient and hassle-free way to apply for a visa in Hong Kong for your next employee? Links’ professional team of 120+ has years of experience dealing with local immigration authorities and will ensure an efficient turnaround of your employee’s visa application. Learn more information here.
Upon hiring new employee(s), the employer must report the personal details of the new employee(s), date of commencement and the terms of employment to the Inland Revenue Department (IRD) by filing form I.R.56E “Notice of Employee Commencement Form” within 3 months of the commencement date.
The Hong Kong Bill of Rights Ordinance generally stipulates that all persons are equal before the law and the law shall prohibit any discrimination on any ground. This principle is materialized through the enactment of the following four ordinances:
There are no legislative requirements on maximum working hours except in the case of a young person (over 15 but under 18 years of age) in industrial undertakings. Common practice involves 8 hours per day.
No provision in Hong Kong specifies a probation period, however, standard practice is to have a 1-3 month period.
Minimum Wages in Hong Kong is currently at HK$37.5 per hour and will be increased to HK$40 starting 1 May 2023. For the monthly rate of HK$15,300 per month and HK$16,300 per month starting 1 May 2023 or below, employers will need to keep records of the total number of hours worked by employees.
Example:
Total Annual Wages = HK$300,000*
Total Annual No Pay Deduction = HK$5,000
Total Annual of No Pay Leave = 4 days
Average Daily Wage = HK$300,000 – HK$5,000
365 days – 4 days
Average Daily Wage = HK$817.17
Read More: Top 5 Questions to Calculating Minimum Wage in Hong Kong
Employment law in Hong Kong is employer friendly and termination of employment contracts is relatively straight forward. During probation, no notice is required for termination of employment contract within the first month, and at least seven days’ notice thereafter unless the contract specifies more than this. If the employer contract does not specify notice, either party must give at least one month’s notice for termination.
Upon the termination of employment, the employer must report the personal particulars of the employee, expected date of termination and remuneration paid/deemed paid in the termination year to the IRD by filing form I.R.56F one month before the date of termination of employment.
In the case of an employee terminating employment to depart from Hong Kong, employers have to file two copies of IR56G or via Electronic Filing of Employer’s Return one month before the expected date of departure.
From the date of filing IR56G and until such time the employee has made tax clearance and can produce to you a ”letter of release” issued by the IRD, you should withhold all amounts due to be paid to him (including salaries, commission, bonus, reimbursement of rent/expense, money or money’s worth included).
In Hong Kong, it is common practice to retire at the age of 65 years old. Since 2000, Hong Kong made it compulsory for employers and employees to contribute to the Mandatory Provident Fund (MPD) which applies to all jobs, including part-time. The MPF allows for full withdrawal upon reaching the retirement age of 65.
Labour Relations Division offices.
Yes, the minimum insurance coverage should be no less than HKD$100 million for a company with less than 200 employees. Companies with more than 200 employees should have an insurance coverage with no less than HKD$200 million.
Employees employed under a continuous contract are entitled to not less than one rest day in every period of seven days.
Employees are entitled to public holidays as follows:
Holiday | Date |
---|---|
The day following the first day of January | 2 January |
The second day of Lunar New Year | 23 January |
The third day of Lunar New Year | 24 January |
The fourth day of Lunar New Year | 25 February |
Ching Ming Festival | 5 April |
Good Friday | 7 April |
The day following Good Friday | 8 April |
Easter Monday | 10 April |
Labour Day | 1 May |
The Birthday of the Buddha | 26 May |
Tuen Ng Festival | 22 June |
Hong Kong Special Administrative Region Establishment Day | 1 July |
The day following the Chinese Mid-Autumn Festival | 30 September |
The day following National Day | 2 October |
Chung Yeung Festival | 23 October |
Christmas Day | 25 December |
The first weekday after Christmas Day | 26 December |
Employees are entitled to public holidays as follows:
Holiday | Date |
---|---|
The first day of January | 1 January |
Lunar New Year’s Day | 10 February |
The third day of Lunar New Year | 12 February |
The fourth day of Lunar New Year | 13 February |
Good Friday | 29 March |
The day following Good Friday | 30 March |
Easter Monday | 1 April |
Ching Ming Festival | 4 April |
Labour Day | 1 May |
The Birthday of the Buddha | 15 May |
Tuen Ng Festival | 10 June |
Hong Kong Special Administrative Region Establishment Day | 1 July |
The day following the Chinese Mid-Autumn Festival | 18 September |
National Day | 1 October |
Chung Yeung Festival | 11 October |
Christmas Day | 25 December |
The first weekday after Christmas Day | 26 December |
Want to focus on strategic functions that aid business growth? Learn how Links Payroll Outsourcing can help reduce HR costs with our stress-free payroll services.
Interested to explore the idea of payroll outsourcing, EoR, or Visa application services? Links International is a leading payroll outsourcing provider across Asia Pacific and supports payroll in over 19 countries. Contact us to learn more!
In the meantime, stay updated on Labour Law updates throughout the year through our Labour Law Insider. For more news and insights into the market, make sure to subscribe to our blog so you don’t miss out on the latest HR news, or contact our team to learn more about the latest changes!
*Please note that all the information listed above are to be used as a general guideline. For more detailed accounts of Hong Kong employment laws and regulations, please visit the official governmental websites.
Links International is a leading payroll outsourcing provider across Asia Pacific and supports payroll in over 17 countries. Please do not hesitate to contact us.