Hong Kong offers an enterprising talent market for businesses that are expanding their business globally. However, employers must have a thorough understanding of the laws and regulations of the country. Some information to get started are stated below.
Employee Contract
Public and Provincial Holidays
Leave Information
Basic
There is no stipulated language preference for written employment contracts in Hong Kong.
Probation Period
Newly hired employees can be under probation for up to 3 months.
13th Month Pay
A 13th month pay is not mandatory for Hong Kong employees. However, most employers in the country pay their employees an extra month each year as a bonus incentive. It is usually released during Lunar New year or at the end of the year.
Employee Benefits
Below are some benefits that workers in Hong Kong often receives:
- Sickness allowance
- Health Insurance
- Pension
- Long service payments
Salaries are paid monthly in Hong Kong. It is due on the last day of the wage period. If the employer fails to release it on the required day, a grace period of 7 days is given after which they are subjected to pay interest on top of the wages.
The National minimum wage in Hong Kong is HKD 40 per hour.
- Minimum relevant income threshold: HKD 7,100/month (below which employees don’t contribute).
- Maximum relevant income threshold: HKD 30,000/month (capping contributions at HKD 1,500).
There are no laws in Hong Kong specifying the standard working hours and the overtime rate for employees. However, employers may outline an overtime rate in the employment contract.
Employer Payroll Tax
| Type of Contribution |
Employee’s Salary |
Rate |
| Mandatory Provident Fund |
Less than HKD 7,100 |
5% |
| Mandatory Provident Fund |
HKD 7,100 – HKD 30,000 |
5% |
| Mandatory Provident Fund |
More than HKD 30,000 |
HKD 1,500 |
Employee Payroll Tax
| Type of Contribution |
Employee’s Salary |
Rate |
| Mandatory Provident Fund |
Less than HKD 7,100 |
0% |
| Mandatory Provident Fund |
HKD 7,100 – HKD 30,000 |
5% |
| Mandatory Provident Fund |
More than HKD 30,000 |
HKD 1,500 |
Employee Income Tax
| Net Chargeable Income (in HKD) |
Tax amount (in HKD) |
Percentage on excess |
| 0– 50,000 HKD |
0 |
2% |
| 50,001– 100,000 HKD |
1,000 |
6% |
| 100,001– 150,000 HKD |
4,000 |
10% |
| 150,001– 200,000 HKD |
9,000 |
14% |
| Above 200,000 HKD |
16,000 |
17% |
Hong Kong offers a standard rate of 15% on net income (whichever is lower: progressive or standard).
VAT
Hong Kong has no Sales Tax nor VAT.
Contract termination in Hong Kong may be initiated by either the employer or employee. It may take place with adequate notice from the party or through payment in lieu of notice. Notice period and pay in-lieu are dependent on whether the employee is on probation as well as contractual considerations.
The notice period for Hong Kong employees depends on whether they are in their probation period or not. Those under probation period will have up to 7 days of notice period while others at least 1 month.
Below is the calculation for severance pay in Hong Kong:
- Salary Type is Paid monthly:2/3 of last month’s pay x reckonable years of service, or it can be 2/3 of HK$22,500 for each month’s pay x years of service; whichever is less
- Salary Type is Paid daily: 18 days’ wage x reckonable years of service
In Hong Kong, foreign employees are encouraged to work in the country via a special work permit scheme called Employment for Professionals. The work permit is issued for a year and can be renewed.
Top talent pass scheme introduced (for high-income professionals and global graduates) after 2023