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Compliantly hire and expand your business in Hong Kong
When it comes to employing and managing employees in Hong Kong, there are specific procedures and regulations that must be followed.
Hong Kong, officially the Hong Kong Special Administrative Region of the People’s Republic of China, is a city and a special administrative region in China. With 7.4 million residents of various nationalities in a 1,104 square-kilometre (426 sq mi) territory, Hong Kong is one of the most densely populated territories in the world.
Hong Kong
Capital
$51,168
GDP per Capita
$385.546 billion
Total GDP
7,498,100
Total Population
0.952
Human Development Index
UTC +8
Time Zone
Chinese, English
Official Languages
Hong Kong Dollar (HKD)
Currency
1,114.35 km2 (430.25 mi2)
Land Area
Here's what you need to know
Overall, employing workers in Hong Kong can be a complex process, but working with a local expert in employment and payroll can help ensure that you’re meeting all the necessary legal requirements and providing a positive employment experience for your staff.
Employment contracts are not mandatory in Hong Kong, but highly recommended. They should clearly outline:
Job title, duties, and responsibilities
Salary and benefits
Working hours and overtime pay
Leave entitlements (annual leave, sick leave, etc.)
Termination terms (notice period, severance pay)
Confidentiality clauses (if applicable)
Minimum Wage
Hong Kong has a statutory minimum wage, currently set at HK$40 per hour.
Payroll Terms
Salaries are typically processed monthly and must be paid within seven days of the end of the wage period. Employers must provide itemized payslips to employees with details of gross pay, deductions, and net pay.
Taxes
Hong Kong operates a progressive income tax system. Employees pay income tax based on their annual earnings, with rates ranging from 2% to 17%. Employers are not required to withhold income tax at source, but employees are responsible for filing annual tax returns.
Mandatory Provident Fund (MPF)
Both employers and employees are required to contribute to the MPF, a mandatory retirement savings scheme. The current contribution rate is 5% of the employee's salary for employers and employees (capped at a certain amount).
Hong Kong has mandated leave entitlements under the Employment Ordinance:
Annual Leave
Minimum of 7 days per year, increasing with service duration (up to 14 days).
Statutory Holidays
12 paid public holidays per year.
Sick Leave
4 days of paid sick leave accrued per month (2 days in the first year), capped at 120 days in a single sickness episode.
Maternity Leave
Up to 10 weeks of paid leave for female employees.
Paternity Leave
3 days of paid leave for male employees.
Probationary Period
There's no mandatory probationary period in Hong Kong. However, employment contracts often include one, typically lasting between 1 and 3 months. During this time, termination can be easier for both employer and employee.
Termination of Employment
Termination of employment should follow the terms outlined in the contract or the Employment Ordinance. Notice periods vary depending on the employee's length of service and the reason for termination. Severance pay may also be required under certain circumstances.
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