Seven years & two years respectively according to the Code of Practice on Human Resource Management. Old employee The employer cannot keep the personal record for an old employee for more than seven years. There are only limited exceptions to justify the extension of the retention period, for example administering the remaining duty of MPF and defend the organisation in any civil suit or criminal prosecution. Some more examples are provided in section 4.1.2 and 4.2.1 of  Code of Practice on Human Resource Management. Unsuccessful job applicant The personal data of an unsuccessful job applicant should not be retained for more than 2 years unless there is any subsisting reason that obligates the employer to do so or the applicant has provided prescribed consent for the data to be kept beyond 2 years. See more in section 2.10 of Code of Practice on Human Resource Management.

You can if it is related to the job nature of the vacancy. If the criminal record is highly related to the nature of the job, then the employer can ask the job applicant if he has a criminal record. The Personal Data (Privacy) Ordinance states that personal data for the purposes of which the data are to be used should be collected. No more than that should be collected. There is no expressed rule on what personal data can be collected for each job application. Therefore, this highly depends on the job nature. For instance, if the job includes interacting with children, a sexual conviction record of the job applicant may be required.

As the COVID-19 pandemic continues in 2021, many companies have maintained their arrangement of working remotely or work from home (WFH). The main areas of consideration for an employer are: Compliance with Occupational Safety and Health Ordinance (“OSHO”) and the common law duty of care:  Under Section 6 of the OSHO, an employer has the statutory duty to ensure the health and safety at work of its employee. If an employer fails to “provide or maintain a working environment for the employer’s employees that is, so far as reasonably practicable, safe and without risks to health” intentionally, knowingly or recklessly, he is liable on conviction to a fine of HKD200,000 and six months’ imprisonment.  Therefore, the employer has an obligation under OSHO and a common law duty of care to make sure that the working environment is safe. In case of WFH arrangement, employers are recommended to take reasonable care for their employees and make sure the working environment is suitable. If the employee is injured during the course of work, the employer may still be liable to the compensation depending on the facts of each case. Compliance with the Employees’ Compensation Ordinance( Cap. 282) (“ECO”): As per the ECO, employers are  liable to pay compensation for personal injury by accident that arises out of and in the course of employment. Also,  as per section 15 of the ECO,  the employer has an obligation to file a Form 2 to the Labour Department within 14 days of the accident . It is important to note that ECO does not specifically state that an employer will be liable for any accidents while the employee is working from home. But depending on the facts of each case, the employer may be held liable to pay compensation for the injury sustained when working from home. It is recommended that employers review their current employees’ compensation insurance policy  and consider whether any additional insurance coverage is

Checking an employee's browsing history may be a common practice for many employers. In many situations, a monitoring activity would amount to “collection” of personal information and therefore you have to make sure everything is in line with the Personal Data (Privacy) Ordinance (Cap. 486). This article wishes to provide you with a brief overview of the guidelines. 3Cs – Clarity, Communication and Control When there is a strong business need to develop employee monitoring policies, remember to follow the 3Cs – Clarity, Communication and Control. Clarity - specify the purposes served by employee monitoring and circumstances under which monitoring may take place.Communication - inform employees about the nature and purpose of monitoring their activities prior to undertaking employee monitoringControl - safely holding, processing and using the monitoring records Employee Monitoring Policy Employers are encouraged to adopt a transparent approach to the formulation of the employee monitoring policies and practices. For instance, employers might provide a written Employee Monitoring Policy to govern personal data management practices.  The Employee Monitoring Policy should include the following areas: The business purposes of employee monitoringThe circumstances under which monitoring will take placeThe kind of personal information that may be collectedThe purposes for which the personal information collected in monitoring records may be used Clear communication with the employees In the situation of the employee’s internet monitoring policy, employers are recommended to include a clear statement declaring the “house rules” of the company. This can enable employees to regulate their behaviours and manage their expectations. You are also recommended to consult employees in the course of developing the Employee Monitoring Policy. This can help formulate the policy from the perspective of employees and reduce the potential dispute

The four anti-discrimination ordinances in Hong Kong (the Sex Discrimination Ordinance (Cap. 480), the Disability Discrimination Ordinance (Cap. 487), the Family Status Discrimination Ordinance (Cap. 527) and the Race Discrimination Ordinance (Cap. 602)) prohibit both discrimination and harassment in the workplace. Discrimination and harassment are certainly different as they refer to different types of acts and/or conduct. General definitions The general dictionary definitions of the terms “discrimination” and “harassment” are different: Discrimination: It is defined as the accomplished or intended differential treatment of social groups or persons due to certain generalised traits.Harassment: It refers to behaviours used or adopted by one person that intends to annoy or trouble another person, e.g. repeatedly attacking the other person or trying to cause the other person problems. Workplace-specific definitions In relation to workplace discrimination and harassment, the definitions provided by the four anti-discrimination ordinances are more specific as they are tailored to the workplace scenario. The terms “discrimination” and “harassment” are defined in the workplace context as: Direct discrimination: This occurs when a job candidate or employee is treated less favourably than another candidate or employee based on the prohibited grounds, e.g. a promotion is not offered to a woman but to a man who is less qualified.Indirect discrimination: This occurs when a policy, rule or practice equally applies to everyone but has a disproportionate effect on a group of people, e.g. specifying in a job advertisement or promotion that candidates can only apply if English is their first language.Harassment: This occurs when someone conducts an act that is unwelcomed or unwanted by another person, e.g. name calling, offensive jokes, mockery or ridicule, interference with work performance and intimation. Bibliography: Hong Kong Government,

If your employee has made a complaint of unlawful discrimination against you or any other person within the company, you should take certain steps to protect yourself: Treating the matter seriouslyBeing careful of not falling into the trap of “victimising” your employee: For instance, you should not force your employee to stay at home.Following the implemented company anti-discrimination policies or grievance proceduresDocumenting and/or recording every evidence gathered and every interview heldIn the case of the complaint being unfounded, gathering evidence to demonstrate that the same treatment would have been given to another actual employee or a hypothetical employeeContacting your lawyers for advice on any defence strategy

The Equal Opportunities Commission has implemented the four anti-discrimination ordinances. Since the implementation, employers and employees in Hong Kong have become more aware of their legal rights and obligations. Numerous things can be done by employers to ensure that they comply with the four ordinances: Implementing transparent anti-discrimination policies and internal grievance procedures: The policies should be written and zero-tolerance. Upon the implementation of the policies, the employers should request their employees, volunteers and interns to sign a declaration for having understood the policies. Employers should also apply the policies consistently and transparently.Taking care when exercising managerial right or discretion to award benefits to employees or promote employees: When exercising their right or discretion, employers should ensure that the reasons of awarding benefits to certain employees or promoting certain employees are not at all related to their employees’ sex, marital status, family status, pregnancy, breastfeeding, disability or race. It is better for the company’s directors and/or managers to record in the minutes succinctly and accurately how the decision has been reached. The record should also demonstrate that the directors and/or managers have considered all relevant factors before making the decision.Taking care when issuing appraisal reports and warning letters: Employers are liable to disclose to their employees their appraisal reports regarding their performance and any warning letters issued to them pursuant to the Personal Data (Privacy) Ordinance (Cap. 486). Hence, none of these documents should give any indication that the employees’ future has been, either fully or partly, determined by an unlawful discriminatory factor.Providing their employees with a work environment that is free from discrimination and harassment Bibliography: BDO Limited, ‘Article: What can employers do to comply with the

Under Hong Kong law, there is no specific legislation prohibiting workplace discrimination based on age. The Hong Kong Government has only tackled age discrimination in Hong Kong since 1996 by educating the public and issuing self-regulatory guidelines to employers. However, these guidelines do not make employers legally liable for any malpractices and the Equal Opportunities Commission do not have the statutory power to investigate or follow up with any age discrimination reports lodged to it. Hence, there have been suggestions to pass a law that prohibits discriminatory practices in the workplace (e.g. remuneration, hiring and dismissal) against mature workers. Mature workers are generally referred to as those aged 50 and above. It was not until May 2019 that the Legislative Council passed a non-binding motion that urges the Hong Kong Government to enact age discrimination legislation in Hong Kong. One of the reasons for passing this motion is the increase from 32.5% to 43.1% of the labour force participation rate of mature persons in Hong Kong. Bibliography: Legislative Council, ‘Protection of mature workers against workplace discrimination’: https://www.legco.gov.hk/research-publications/english/essentials-2021ise12-protection-of-mature-workers-against-workplace-discrimination.htm

If your employee alleges that they have been discriminated against in the workplace, the first thing that they may do is to check whether the company’s policy has protected them from the discriminatory act. Then, they may make a complaint to the individual responsible for the discriminatory act. They may also lodge a complaint to the management team of your company or seek help from their labour union or staff association if the complaint is job-related. What might your employee do if they do not receive any positive reply? After making a complaint to the discriminator or to the management team of your company, if your employee does not receive any positive reply, they may initiate a complaint with the Equal Opportunities Commission. An alternative option to this is to commence a case at the District Court. If your employee has been discriminated against or treated badly due to acting as a witness or providing information for a colleague or friend who has lodged a complaint, they may also make a complaint of “victimisation” to the management team of your company or to the Equal Opportunities Commission. Once you are aware that an allegation has been made by your employee regarding workplace discrimination, it is best to make a record as soon as possible regarding the complaint. This will ensure that you do not forget about the details and that everything is properly and thoroughly recorded. Lodging a complaint with the Equal Opportunities Commission If your employee wishes to lodge a complaint with the Equal Opportunities Commission, they can complete the online complaint form, by sending a fax at 2106 2324, or by posting to or attending in person at 16/F, 41 Heung Yip Road, Wong Chuk Hang, Hong Kong. There is a time limit to lodging a complaint with the Commission – within 12 months from the date of the incident. In your employee’s complaint, the following information must be provided: Details and dates of the discriminatory

On 19 June 2020, the Discrimination Legislation (Miscellaneous Amendments) Ordinance 2020 came into force. The Ordinance was enacted to improve protection against discrimination. It has also amended the existing workplace discrimination law, including the Sex Discrimination Ordinance (Cap. 480), the Disability Discrimination Ordinance (Cap. 487), the Family Status Discrimination Ordinance (Cap. 527) and the Race Discrimination Ordinance (Cap. 602). Changes made to the existing workplace discrimination law The major changes made by the Discrimination Legislation (Miscellaneous Amendments) Ordinance 2020 to the existing workplace discrimination law include the following: Amending the Sex Discrimination Ordinance (Cap. 480) to also prohibit unlawful discrimination based on the ground of breastfeeding: The provisions on breastfeeding will not come into force until 19 June 2021.Extending the scope of unlawful disability, sexual and racial harassment to “workplace participants” so long as they attend or work in the same workplace: Workplace participants refer to volunteers, interns or barristers’ pupils who do not have any employment relationship with the person that engages them. Having extended the scope, volunteers, interns and pupils will be personally liable for committing any act of harassment during their voluntary service or internship. Likewise, those who engage volunteers, interns or pupils can be vicariously liable for any unlawful act of harassment committed by the volunteers, interns or pupils.Extending the scope of protection under the Race Discrimination Ordinance (Cap. 602) to protect individuals from racial harassment and direct and indirect racial discrimination by imputationLike the Sex Discrimination Ordinance (Cap. 480), extending the scope of protection under the Disability Discrimination Ordinance (Cap. 487) and the Race Discrimination Ordinance (Cap. 602) to also prohibit racial and disability harassment by customers and service

Employment discrimination occurs when a job candidate is being treated unfavourably or less favourably than other candidates. Similarly, workplace discrimination happens when an employee is being treated unfavourably or less favourably than other employees. Under Hong Kong’s anti-discrimination law, employment or workplace discrimination is prohibited. It is unlawful to discriminate against a job candidate or employee based on certain grounds. Grounds of employment or workplace discrimination As stipulated in the Sex Discrimination Ordinance (Cap. 480), the Disability Discrimination Ordinance (Cap. 487), the Family Status Discrimination Ordinance (Cap. 527) and the Race Discrimination Ordinance (Cap. 602), it is unlawful to discriminate a job candidate or employee based on the following grounds unless any exemption applies: SexDisabilityFamily StatusMarital statusPregnancyRace (including colour, race, and descent or ethnic/national origin) Forms of employment or workplace discrimination The four ordinances mentioned above prohibit various forms of employment or workplace discrimination, including: Direct discrimination: This occurs when a job candidate or employee is treated less favourably than another candidate or employee based on the prohibited grounds, e.g. a promotion is not offered to a woman but to a man who is less qualified.Indirect discrimination: This occurs when a policy, rule or practice equally applies to everyone but has a disproportionate effect on a group of people, e.g. specifying in a job advertisement or promotion that candidates can only apply if English is their first language.Victimisation: This happens when someone at the workplace punishes you for making or supporting a complaint about employment or workplace discrimination.Vilification: This happens when someone conduct an act to incite hatred towards or to seriously ridicule or contempt for another person based on race or disability.Harassment: This occurs when someone

Irrespective of an employee’s length of service, they are entitled to 12 statutory holidays: 1st JanuaryLunar New Year’s Daythe second day of Lunar New YearThe third day of Lunar New YearChing Ming Festival1st May (Labour Day)Tuen Ng Festival1st July (HKSAR’s Establishment Day)The day after the Chinese Mid-Autumn FestivalChung Yeung Festival1st October (National Day)Chinese Winter Solstice Festival or Christmas Day (the employer can choose which one) Working on statutory holiday(s) If the employer wants their employee to work on statutory holiday(s), the employer should do certain things: Alternative holiday arrangement: An alternative holiday should be arranged within 60 days before or after the statutory holiday.Prior notice to the employee on the date of the alternative holiday: The notice should be given at least 48 hours before the alternative holiday or the statutory holiday. An employee can also take a substituted holiday on any day within 30 days before or after the alternative holiday or the statutory holiday upon an agreement between the employer and the employee. Bibliography: Labour Department, ‘Chapter 4: Rest Days, Holidays and Leave’: https://www.labour.gov.hk/eng/public/wcp/ConciseGuide/04.pdf

If an employer intends to shut down their business or part of it for granting annual leave to their employees, they should make a written inform to the affected employees at least one month in advance. If an employee is not entitled to any paid annual leave for any day during the shutdown period but they must stop working due to the shutdown, they should be given paid annual leave during that entire period. If an employee is entitled to annual leave that exceeds the number of days of the shutdown, they may immediately take the remaining annual leave after the shutdown. The annual leave shutdown should not affect the common leave year that is to be elected by the employer. The annual leave should be granted in respect of the leave year that immediately precedes the shutdown period. Bibliography: Labour Department, ‘Chapter 4: Rest Days, Holidays and Leave’: https://www.labour.gov.hk/eng/public/wcp/ConciseGuide/04.pdf

During their period of employment, employees are entitled to enjoy statutory holidays, rest days and paid annual leave. Annual leave refers to paid time off work given by employers to employees. In Hong Kong, an employee is entitled to paid annual leave every 12 months if they have been employed under a continuous contract. Calculation of annual leave The number of days of annual leave depends on an employee’s length of service: Length of Service (years)Annual Leave (days)172738495106117128139 or more14 If a rest day or a statutory holiday falls within the period of annual leave, they will be counted as annual leave. Hence, another rest day or holiday must be appointed by the employer. If an employee has completed service of at least 3 months but less than 12 months within a leave year, they are entitled to pro-rata annual leave pay unless the employee is summarily dismissed by the employer. There are certain steps that an employer must take when granting paid annual leave: Consult with your employee or their representative regarding the appointment of the time of the leaveConfirm the leave by issuing a written notice to your employee at least 14 days in advance, unless a shorter period has been agreed between you and your employee However, you must not include a term to forego any or all of your employee’s annual leave entitlement in their employment contract (including payment of wages in lieu of any or all annual leave days), unless your employee chooses to accept payment in lieu of a part of their annual leave entitlement that exceeds 10 days. Bibliography: Labour Department, ‘Chapter 4: Rest Days, Holidays and Leave’: https://www.labour.gov.hk/eng/public/wcp/ConciseGuide/04.pdf

On the last day of your employee’s wage period, their wages become due and you should pay wages to them as soon as possible. In any case, you should pay wages to your employees not later than seven days after the end of their wage period. If you fail to pay wages to your employees within these seven days, you will be required to pay interest on the outstanding amount. The interest will be calculated at the rate fixed by the Court of Final Appeal’s Chief Justice. Besides being liable to pay interest, you may also be liable to prosecution and to one-year imprisonment and a HK$200,000 fine upon conviction if you fail to pay wages to your employees. If you fail to pay the interest on the outstanding wages, you may be liable to prosecution and to conviction and a HK$10,000 fine upon conviction. If you, as an employer, are no longer able to pay wages to your employees, you should terminate the relevant employment contract according to its terms. If you still have not paid wages to your employees after one month from the due date, your employees may deem their employment contracts as being terminated by you without notice. They may then be entitled to wages in lieu of notice as well as other contractual and statutory termination payments.

Generally, an employer is prohibited under section 32 of the Employment Ordinance (Cap. 57) from deducting their employee’s wages. However, if damage or loss has been caused to the employer’s equipment, goods or property by the employee’s default or neglect, the employer can deduct the employee’s wages. In any one case, the sum to be deducted from the employee’s wages should be equivalent to the value of the loss or damage, but it cannot exceed HK$300. The total of the deductions also cannot exceed one quarter of the employee’s wages payable during that wage period. An employer may be liable to prosecution and to one-year imprisonment and a fine of HK$100,000 upon conviction if they make any illegal deduction from their employee’s wages (section 32 of the Employment Ordinance (Cap. 57)). Bibliography: Labour Department, ‘Chapter 3: Wages’: https://www.labour.gov.hk/eng/public/wcp/ConciseGuide/03.pdf1823.gov.hk, ‘In what circumstances can an employer deduct the salary of an employee?’: https://www.1823.gov.hk/en/faq/in-what-circumstances-can-an-employer-deduct-the-salary-of-an-employee

Wages refer to all earnings, tips, allowances, remuneration and service charges payable to an employee for the work done or to be done by them. In Hong Kong, the statutory minimum wage is currently set at HK$37.50 per hour by the Minimum Wage Ordinance (Cap. 608). Generally, the Ordinance applies to every employee, their employer and the contract of employment under which they are engaged. Exemptions from paying the minimum wage Certain student employees are exempted from receiving the statutory minimum wage. They include: Student interns; andWork experience students. You are exempted from paying interns and/or students the minimum wage as they do not have any employment relationship with your organisation or company. However, the specified student employees must be attending the types of education programmes specified under the Minimum Wage Ordinance (Cap. 608). There are also some significant differences between the nature and the requirements of an internship and a work experience: InternshipWork ExperienceTypes of Education Programmes Enrolled inStudents attending full-time accredited programmes provided by local education institutions (see Schedule 1 of the Minimum Wage Ordinance (Cap. 608)); or Hong Kong resident students enrolled in full-time programmes at degree or higher level for non-local academic qualificationSame as internshipNatureEndorsed or arranged by the education institutions that provide the programmes; and the internship forms an elective or compulsory part of the programmesDoes not have to be endorsed or arranged by the education institutions; and does not have to be curriculum-relatedAge and DurationNo restriction on both age and duration of the internshipAge: below 26 years old at the time of the commencement of the employmentDuration: A continuous period of up to 59 days can be treated as exempt student employment upon agreement between the student and their employer; one exempt student employment at most may commence

Yes, garden leaves are generally enforceable to prevent an employee from taking a job at a competing business immediately post-termination of their contract. What is garden leave? Garden leave allows an employee who has left their position and no longer needs to report to work but still remains on the payroll and entitled to full wage. This prevents a leaving employee from sharing confidential information when they are on the notice period. This period of garden leave is often used by employees to pursue travel or pursue hobbies – such as gardening – hence the name ‘gardening leave’ or 'garden leave'. Benefits of garden leave 1) It helps employers retain key employees and clients Employers, during garden leave, can consolidate relations with colleagues to ensure they do not get poached by the employee on garden leave when that employee starts their next job. Similarly, employers often consolidate relations with customers, to ensure they retain their business and are not taken by the employee on garden leave. 2) It helps protect confidential information During the garden leave period, an employee is not required to report to work, so they cannot access any new sensitive, confidential and/or proprietary information produced by the company during that period. Also, it ensures that an employee is kept out of the job market for long enough, such that any information in their possession becomes outdated. This prevents competing businesses from obtaining an unfair competitive advantage through the ex-employee. 3) It can prevent employees from immediately joining a competitor or starting their own competing business During the garden leave, an employee is normally restricted from joining a competitor or starting their own business to compete with their employer. When is garden leave enforceable? It is likely that if an employment agreement contains an express garden leave clause it will be enforceable, even if the

Yes, non-competes are enforceable, if they are reasonable. Employers should state the non-compete clauses clearly and precisely in the employment contract. What is a non-compete? A covenant not to compete, also called a ‘non-compete’, is a clause included in an agreement, between an employer and employee, whereby the employee agrees not to work in competition with the employer. They aim to protect an employer’s customers, suppliers and employees from being poached by an ex-employee. Covenants not to compete also prevent confidential, proprietary information and trade secrets of an employer from being used by an ex-employee for their benefit. Covenants not to compete are normally effective both during the course of employment and after the end of an employment relationship. Post-termination non-compete is common in Hong Kong. Should I include a non-compete? There are many factors you should consider on whether it is appropriate to insert a non-compete clause to the employment contract, including: Industry standardsan employer is in client-facing industries and industries where businesses depend on customer loyalty, should consider adding non-compete clausesEmployee seniorityIf the employee is especially senior and plays a central role within the company, a non-competitive agreement may be more enforceable. Exposure to confidential information and trade secrets during the course of their employment What should be included in a non-compete? A non-compete clause should contain a restraint period, which indicates how long a non-compete clause should be effective. An employer should consider the following factors to decide the length of the restraint period: State of the employment market the longer it may take to replace an employee the longer your solicitation agreement should last for. How long an employer’s confidential information will remain ‘confidential’.Industry-standard Normally, the length of the

Yes, employers can offset MPF contributions. How to offset MPF contributions If severance payment/ long service payment has been paid:Employers may make an application with supporting documents to their trustees to withdraw the MPF derived from the employer’s contributions from the employee’s account.Employers may require their employees to acknowledge receipt of such payment in writing to facilitate their application for offsetting with their trustees.If severance payment/ long service payment has not been paid:Employees may make an application in writing to their trustees directly to withdraw the MPF derived from the employer’s contributions from their accounts. If the amount of MPF derived from the employer’s contributions is not enough to cover the LSP/SP, the employee is entitled to recover the shortfall from the employer.The employee may be required by their trustees to provide proof that they are entitled to the severance payment/ long service payment and that such payment has not been paid by their employers.

An employee employed under a continuous contract for not less than 5 years is eligible for long service payment if: he is dismissed (except by reasons of redundancy or summary dismissal due to the employee’s serious misconduct);his fixed term employment contract expires without being renewed;he dies during employment;he has been issued a certificate in a specified form by a registered medical practitioner or a registered Chinese medicine practitioner, certifying that he is permanently unfit for his present job and he resigns; orhe is aged 65 or above and resigns on the grounds of old age. How much should be paid ? Monthly-paid employee(Last month of wages x 2/3) × Reckonable years of serviceDaily-rated/ piece-rated employee(Any 18 days' wages chosen by the employee out of the last 30 normal working days) × Reckonable years of service The maximum amount of payment is $390,000. Long service payment should be paid to an employee as soon as possible and within 7 days after the date of termination of the employment contract.

Severance payment is the compensation an employer provides to an employee if they have been dismissed due to redundancy or laid off, so only these employees are eligible for a severance payment. Redundancy An employee is dismissed due to redundancy if the dismissal is because: the employer closes or intends to close the business;the employer has ceased, or intends to cease, the business in the place where the employee was employed; orthe requirement of the business for the employer/ employee to carry out work of a particular kind, ceases or diminishes or is expected to cease or diminish. Lay-off If an employee is employed on such terms and conditions that the remuneration depends on the amount of work provided by the employer, the employee will be considered to be laid off if the total number of days on which no work is provided or no wage is paid exceeds: half of the total number of normal working days in any four consecutive weeks; orone-third of the total number of normal working days in any 26 consecutive weeks. Rest days, annual leave and statutory holidays should not be counted as normal working days during the above periods. How much should be paid Monthly-paid employee(Last month of wages × 2/3) × Reckonable years of serviceDaily-rated/ piece-rated employee(Any 18 days' wages chosen by the employee out of the last 30 normal working days) × Reckonable years of service The maximum amount of payment is $390,000. When employers should pay Employees who wish to claim severance payments should serve written notice to their employers within three months after the dismissal/layoff takes effect. The employers must make the severance payments to their employees not later than two months from the receipt of such notice. An employer who fails to pay a severance payment to an employee is liable to prosecution and, upon conviction, to a fine of $50,000. Key takeaways Employees who are dismissed due to redundancy or laid

When a dispute arises, an employee should first approach their employer with a written notice of their claim within 3 months of the termination of employment. If they cannot settle the dispute, the employee may bring it to the Labour Tribunal within 9 months of terminating the employment. The Labour Tribunal may order: reinstatement or re-engagement of the dismissed employee;an award of terminal payments against the employer and compensation Reinstatement or Re-engagement Order An order for reinstatement requires the re-employment of the employee by the employer and the employer must treat the employee as if they had not been dismissed. An order for re-engagement is re-employment of the employee by the employer, or by a successor of the employer or by an associated company, on terms comparable to their original terms of employment or in other suitable employment. If the Labour Tribunal considers it appropriate and reasonably practicable to do so reinstatement or re-engagement Order can be made without the employer’s consent. Terminal Payments and Compensation If an order for Reinstatement or Re-engagement Order is not made, the Labour Tribunal can award terminal payments or compensation to the employee. Terminal payments include: 1) the statutory entitlements under the Employment Ordinance which the employee is entitled to but has not yet been paid upon dismissal 2) the entitlements the employee might reasonably be expected to be entitled to under the Employment Ordinance had he been allowed to continue his employment; and 3) any other payments due to the employee under his contract of employment. A compensation of up to a maximum of $150,000 will be awarded if the employee is unreasonably or unlawfully dismissed, irrespective of the Terminal Payment. In determining whether compensation would be awarded: the Labour Tribunal will consider: 1. the circumstances of the employer and the employee; 2. the period of

An employer cannot dismiss an employee whenever they want to, as there are circumstances where dismissal is unreasonable or unlawful. Unreasonable dismissal The Employment Ordinance states 5 valid reasons for dismissal or variation of the terms of an employment relate to: (a) the conduct of the employee; (b) the capability or qualification to perform work; (c) redundancy or other genuine operational requirements of the business; (d) statutory requirements; or (e) other substantial reasons. If an employer dismisses an employee, who has been employed for at least 24 months, without a valid reason, then the dismissal would be unfair/ unreasonable. Unlawful dismissal The Employment ordinance lists 5 circumstances where the dismissal of an employee is unlawful. This includes the dismissal of : A female employee who has been confirmed pregnant and has served a notice of pregnancy to her employer;An employee who is on paid sick leave;An employee because gave evidence or information in any proceedings or inquiry in connection with the enforcement of the Employment Ordinance, work accidents or breach of work safety legislation (engaged in whistle-blowing)An employee for trade union membership and activities; orAn injured employee before having entered into an agreement with the employee for employee's compensation or before the issue of a certificate of assessment. Penalties An employer will be liable to their employee if they unreasonably and/or unlawfully dismiss their employee, and they may be ordered by the Labour Tribunal for a reinstatement/ re-engagement order, terminal payments or compensation. Key Takeaways An employer should give valid reasons to dismiss an employeeAn employer must prevent dismissing an employee in circumstances that would become illegal

Termination payments are paid usually when an employee’s employment contract is terminated. An employer may need to pay a termination payment, which may include: outstanding wages;payment in lieu of notice, if any;payment in lieu of any untaken annual leave, and any pro-rata annual leave pay for the current leave year;any outstanding sum of end of year payment, and pro-rata end of year payment for the current payment period;where appropriate, long service payment or severance payment;other payments under the employment contract, such as, gratuity, provident fund, etc. Calculations on the precise amount of termination payment can be found on the Labour Department’s website. When should it be paid An employer must make any termination payment as soon as possible and may need to consider whether severance or long service payment should be paid too. An employer is required to pay interest on the outstanding wages due to the employee if he fails to pay wages to the employee within seven days after the termination or expiry of the contract. An employer who willfully and without reasonable excuse fails to pay termination payments when they become due may be liable to a fine of $350,000 and to imprisonment for three years. Bibliography 1823.gov.hk, “ Upon termination of employment, what are the obligations and entitlements of employer and employee?”: https://www.1823.gov.hk/en/faq/upon-termination-of-employment-what-are-the-obligations-and-entitlements-of-employer-and-employee-ans-01 

An employer can terminate an employee without notice by paying in lieu of notice, if they want the employee to be dismissed immediately. An employer can summarily dismiss an employee without notice or payment in lieu of notice if the employee had engage in the following circumstances: wilfully disobeys a lawful and reasonable order;misconducts himself;s guilty of fraud or dishonesty; oris habitually neglectful in his duties. An employee can constructively dismiss their employment contract without notice or payment in lieu of notice in the following circumstances: he reasonably fears physical danger by violence or disease;he is subjected to ill-treatment by the employer; orhe has been employed for not less than 5 years and he is certified by a registered medical practitioner as being permanently unfit for the type of work he is engaged in. Payment in lieu of notice An employer may offer payment in lieu of the notice. The length of notice period will affect the amount an employer has to pay, and the payments can be calculated as follows: Continuous employment contractPayment in lieu of noticeWith an expressed agreement on notice periodA sum equivalent to the amount of wages for the notice periodWithout an expressed agreement on notice periodA sum of not less than one month's wages Probation PeriodPayment in lieu of Notice Within the first month of probationNot requiredAfter the first month of probation, if expressly agreedWith an expressed agreementA sum equivalent to the amount of wages for the notice periodWithout an expressed agreementA sum of not less than seven days' wages The payment in lieu of notice must be done as soon as possible and within 7 days after the contract expires. Summary dismissal An employer can summarily dismiss an employee without notice and payment in lieu of notice, but only in very exceptional circumstances. An employer may summarily dismiss an employee without notice or payment in lieu of notice if

The party who requested for termination of an employment contract is required to give the other party due notice, either in writing or orally. Length of notice period The length of notice period will depend on whether the employee is employed in the continuous employment contract or in a probation period. Continuous employment contractLength of notice With an expressed agreementAs per the agreement, but not less than seven daysWithout an expressed agreementNot less than one month Probation PeriodLength of NoticeWithin the first month of probationNot requiredAfter the first month of probationWith an expressed agreementAs per the agreement, but not less than seven daysWithout an expressed agreementNot less than seven days' notice Termination notice by writing The termination letter should include the length of notice period, any payment that the employee is entitled to and the reason for termination. A sample of a termination notice can be found here. Although there is no requirement that a notice of termination must be given in writing and contain the reason for termination, it is advisable that an employer issues a written notice on termination. It can ensure that the notice period is appropriate, employment payments are paid in full and there is a valid reason for the termination. Key Takeaways A party terminating a contract must give an adequate notice periodThe notice should preferably in writing Bibliography Labour Department “Chapter 9: Termination of Contract of Employment”: https://www.labour.gov.hk/eng/public/wcp/ConciseGuide/09.pdf

There are multiple ways an employment contract can be terminated, for example: by resignationconstructive dismissalsummary dismissaldismissal by the employerby mutual agreementthe expiry of a fixed term Resignation An employee can resign from their employment by sending their employer a resignation letter. They must be aware of the notice period before their employment contract will be terminated.  Constructive dismissal An employee can be constructively dismissed from their employment contract if the employer had created a hostile working environment, and they would not need to provide a notice period or payment. Summary dismissal An employer may summarily dismiss an employee without notice or payment in lieu of notice if the employee has committed a serious misconduct. Dismissal by the employer An employer could dismiss an employee by giving them a notice period. However, they could give them a payment in lieu of notice period instead, or summarily dismiss their employee without giving them a notice or payment. Mutual agreement An employer and employee can agree to terminate an employment agreement by mutual consent. Expiry of a fixed term A continuous employment contract is terminated when time has elapsed and the fixed term in the contractual agreement has expired. For an employer to validly dismiss an employee, termination payments including severance or long service payments that must be paid to the employee when the contract is terminated. An employer must avoid circumstances where terminating a contract is unreasonable and unlawful, as they may become liable to claims from the employee dismissed.

Yes, you can hire foreigners who have a valid work visa. The Hong Kong government advises employers to give first preference to the local workforce for filling job vacancies, but foreigners who possess special skills, knowledge or experience are allowed to enter and stay in Hong Kong for employment as professionals. As an employer, you should assist your employee apply for a working visa, before they could begin working in Hong Kong. More details on the application process can be found on the Immigration Department’s website. It is a criminal offence for a foreigner to work in Hong Kong without a valid work visa.

Yes, it is possible to hire students without paying them minimum wage. A student employee is exempt from the Minimum Wage Ordinance. To qualify as a student employee, the student must be a Hong Kong resident enrolled in full-time education. There are 2 types of student employees, including the work experience intern and the student internship. The main difference is that the former requires the internship to be arranged or endorsed by their educational institutions and form a compulsory or elective component of their programmes, but the latter does not.  Before their internship commences, an internship agreement should be signed by the employer and the intern. Additionally, the student employee must complete the confirmation of student status and additionally, a statutory declaration if they are a work experience intern. You should also keep a copy of the document(s) for record-keeping purposes.

Varying an employment contract involves changing, removing or adding in terms and conditions of an employment contract after it had been signed. It is possible for you to vary an employment contract, but you must have your employee’s consent and have a valid reason for doing so. Formalities for variating a contract Under the Employment Ordinance: An employer must inform the employee of such change clearly to the employee, whenever there is any change in the employment conditionsan employer must provide his employee with a copy of the written amendment immediately after the amendment is reduced to writing or validate, where there is any written amendment to the employment conditions,  Reasonable variation of a contract There are 5 valid reasons for varying a contract per the Employment Ordinance, including:  i) the conduct of the employee; ii) the capability or qualifications of the employee for performing his work; iii) redundancy or other genuine operational requirements of the business; iv) statutory requirements; or v) other substantial reasons. With regards to i), the employment contract can be varied if the employee: a. wilfully disobey any lawful and reasonable orders; b. are guilty of misconduct; c. are guilty of fraud or dishonesty; or d. are habitually neglectful in their duties.

Yes. Within 3 months of employing a person, you will need to fill in the IR56E form to inform the Inland Revenue Department, if you anticipate that the employee is likely to be chargeable to Salaries Tax. You should also submit the report remuneration paid to the employee by submitting either IR56B or IR56M. Hiring a new employee On hiring the employee, you have an obligation to maintain a record of that person's : (a) personal particulars (name, address, identity card or passport number with place of issue, marital status) (b) nature of employment (full time or part-time) (c) capacity in which employed (e.g. sales manager, salesman, worker, in-house lawyer, accountant, director) (d) amount of cash remuneration (e) non-cash and fringe benefits (such as quarters, holiday journey benefits, share award, share option) (f) employer's and employee's contributions to the Mandatory Provident Fund (MPF) or its equivalent The IR56E form should be completed within 3 months from the date of commencement of employment, and sent to the Inland Revenue Department. A failure to do so may result in a fine of $10,000. Report remuneration Employers would be required to complete the IR56B form  (namely Employer's Return of Remuneration & Pensions)  for each of their employees. You would need to fill in their personal details and salary details in the form to report their remuneration to the Government within 1 month of receiving notification to do so. Most income items are taxable in Hong Kong, except for some compensation items exempted by the Inland Revenue Ordinance, and for Severance Payment, Long Service Payment and Jury Fees. Independent contractor If your worker is not an employee, but a consultant, agent, broker, freelance artist, entertainer, sportsman or writer etc., and you pay the worker remuneration exceeding $25,000 per annum, you should file the form IR56M instead. Key takeaways Employers are

Sickness or injury - No Employees may not be able to work due to sickness or injury. In this case, this will not break the continuity of continuous employment. However, if there is any absence of work for more than 48 hours then it should be supported by a medical certificate issued by a registered medical practitioner, registered Chinese medicine practitioner or registered dentist. (see paragraph 3(2) (a) - First schedule) Transfer of business - No If a business, trade or undertaking is transferred to another owner, the continuity of employment is not broken. (see paragraph 5 - First schedule) Different work for the same employer - No In the commercial world, it is common that employees might work for the same employer under different employment contracts (even for different jobs in different departments). This will not break the continuity of the contract. (see paragraph 6 - First schedule) If there is any dispute, as an employer, you are responsible for proving that there is no continuous contract.

Employees who are continuously employed are entitled to many additional benefits under the Employment Ordinance. Therefore, as an employer, it is important to understand if your employees are under a continuous contract or not. According to the Employment Ordinance, an employee who has been employed by the same employer for four weeks or more, with at least 18 hours worked in each week, is regarded as being employed under a continuous contract of employment.  This is applicable for both full-time and part-time employees. Benefits and Entitlements All employees are entitled to certain basic benefits such as: Payment of wagesRestriction on wage deductionsStatutory Holidays However, Continuous employees are entitled to additional benefits: Rest daysPaid annual leaveSickness allowancePaid maternity leave and paternity leaveSeverance / long service payments, provided other conditions are met by the employee.

As an employer, you must be aware whether your worker is an employee or an independent contractor, as it would greatly affect the rights and benefits you must provide for your worker. Difference between employee and independent contractor Different factors may be considered to distinguish between an employee and independent contractor, but these factors are not conclusive indications of the employment status. Factors that may be consideredEmployeeIndependent contractorControl over work procedures, working time and method✖✔The person is carrying on business on his own account with investment and management responsibilities✖✔The person is not properly regarded as part of the employer’s organisation✖✔Whether the person is free to hire helpers to assist in the work✖✔Bearing of financial risk over business (e.g. any prospect of profit or risk of loss)✖✔ Ultimately, the decision rests on the court to determine the employment status of a worker. A sample of an independent contractor contract can be found here. Rights and benefits of an employee and independent contractor Only employees would be entitled to the rights and benefits provided under the Employment Ordinance, as it usually only applies to employers and employees who are engaged under contracts of employment. To avoid unnecessary disputes, an employment contract should separate between an employee and a contractor (or self-employed person). Rights and benefitsEmployeeContractor or Self-employed personEntitled to basic protection under the Employment Ordinance. If engaged under a “continuous contract”, also entitled to employment benefits such as paid annual leave, statutory holiday pay, sickness allowance, severance payment or long service payment, etc.✔✖Entitled to protection under the Minimum Wage Ordinance, including the statutory minimum wage✔✖Entitled to protection under the Employees’ Compensation Ordinance, including sick leave and compensation

The Employment Ordinance does not differentiate between full-time and part-time employees. Part-time workers are entitled to the same protection and benefits as full-time workers. These include protection under the Minimum Wage Ordinance and Employment Ordinance, as well as MPF contributions. There is currently no legislation on maximum working hours or maximum overwork time. However, the working hours including overtime hours should be clearly stated on a written and signed employment contract, to maintain a good working relationship with your employee.

No, verbally agreed employment contracts are legally enforceable. But you are strongly advised to have a written employment contract. Benefits of written contracts There are multiple benefits of having a signed written employment contract, which includes: Specifying explicitly and serves as evidence of the employment terms and conditions;Reminding both employers and employees of their contractual obligations;Protecting the interests of both parties; andMinimising unnecessary labour disputes. What goes into an employment contract Per the Employment Ordinance, an employer must include the following in their employment contract: Wages (including rate of wages, overtime rate and any allowances, whether calculated by the piece, job, hour, day, week or otherwise);Wage period;Length of notice required to terminate the contract; andEnd of year payment or proportion of it and the payment period (if applicable).Other employment conditions such as working hours, holidays arrangements, etc., should also be clearly specified. If the contract of employment is in writing, the employer is required to provide a copy of the contract to the employee immediately after it is signed or validated. A copy of a standard employment contract can be found here.

Hiring employees is essential to a business, so as an employer, you must be aware of the requirements and process of hiring an employee. Who you can hire You should comply with the guidelines issued by the government to avoid discrimination in the workplace. Employers should hire people based on their abilities, aptitude and knowledge and should not turn down people just because of their gender, disability, family status, race or age. You can employ anyone aged 15 or above, however, young persons (15-18 years old) employed in industrial undertakings are subject to working hour regulations according to the Employment Ordinance. You can employ students and foreign workers (subject to VISA requirements) too. Employment rules The Employment Ordinance states the relevant rights and benefits offered to all employees. For example, those who are working under a continuous contract of employment are entitled to benefits such as maternity leave and annual sickness days. The Minimum Wage Ordinance states that employers must pay employees at least a minimum wage (which is HK$37.5/ hour in 2021). The employment rules apply to all employees, but they may not apply to independent contractors or the self-employed. Paperwork requirements There are 4 documents you will require to hire an employee in Hong Kong, including: PaperworkWhen it should be completedWhat you must do Employment contractBefore the date of commencement of an employment contractAn employment contract, preferably written, should be agreed by both parties.It must include the wage, wage period, termination notice period and any end of year payment.InsurancePurchase insurance for your employee(s).MPFWithin 60 days of employmentEnrol your employee into an MPF schemeOn the 10th day of this month, make your first MPF contribution to the employeeTaxWithin 3 months of commencementFill in the taxation form to the Inland Revenue Department

Yes, you are obliged to purchase insurance for your employees to protect your company against any potential liability that may arise when there is an accident at work, as the insurance allows you to compensate your employee who suffers from a job injury or death. What does the insurance cover? Employees are covered by the Employees’ Compensation Ordinance for injuries arising because of or during the period of employment. All Hong Kong employers are liable to compensate their employees who are employed by an employment contract for their work injury, occupational disease, and death in the course of their employment. Employers are required to take out a policy of insurance concerning such liability, irrespective of the length of employment contract or working hours, full-time or part-time, permanent job or temporary employees. An employer who failed to buy compulsory insurance for employees is subject to a maximum fine of $100,000 and imprisonment for two years. Amount of insurance The minimum insurance cover is determined based on the number of employees. No. of EmployeesAmount of Insurance Cover per Event≤ 200not less than $100 million> 200not less than $200 million When your employee suffers a work injury The employer must notify the Commissioner for Labour of any work accident or prescribed occupational disease. Resulting inNotice PeriodFormWork injury Incapacity for a period not exceeding 3 daysForm 2b (https://www.labour.gov.hk/eng/form/ecd/pdf/f2b.pdf?formref=LAB-F141)Incapacity for a period exceeding 3 daysWithin 14 daysForm 2 (https://www.labour.gov.hk/eng/form/ecd/pdf/f2.pdf)DeathWithin 7 daysForm 2a (https://www.edb.gov.hk/attachment/en/sch-admin/admin/about-sch/sch-safety/19EC%20Form%202A_E.pdf)Occupational diseaseIncapacityDeathWithin 7 days The employer should notify the insurer (not the insurance broker) as soon as possible, within the stipulated period and in the specified format (in writing or by specified

The Mandatory Provident fund is a retirement protection framework set up by the Hong Kong Government, and acts as a safety net for retirement for the ageing population in Hong Kong. As the name suggests, it is mandatory for both the employers and employees to make contributions to the fund. Exceptions to the MPF If your employee is employed for at least 60 days, you must contribute to the MPF, unless they fall under any of the categories, for example: employees and self-employed persons who are under 18 or over 65 years of agedomestic employeesself-employed hawkers Choosing an MPF scheme As an employer, you would normally select which MPF scheme to contribute to, but you are encouraged to consult your employees before making the decision. You may also offer two or more MPF schemes for employees to choose from. You can compare different schemes on the MPF Fund Platform, provided by the MPF Authority. Size of MPF contribution Your contribution to the MPF will depend on your employee’s monthly income. Employee’s monthly incomeEmployer’s contribution Employee’s contributionMinimum relevant income level≤ HK$71005% of employee’s incomeNil. HK$ 7100-30,0005 % of employee’s income5 % of employee’s incomeMaximum relevant income level≥ HK$ 30,000 $1,500$1,500 When to make an MPF contribution On or before the 10th day of each month, employers must make the mandatory contribution for employees who are paid on a monthly basis. Within 7 working days of making the mandatory contributions, employers must provide each employee with a monthly pay record. The pay record should include the employee’s relevant income, the number of contributions made and the date the contributions were paid. If you have recently employed someone, you must enrol them into an MPF scheme within the first 60 days, and on the 10th day of that same month, you must make your first contribution to MPF. Key Takeaways An employer must make an

As an employer, there are a number of legal issues that you should be aware of. Here are some examples. Vicarious Liability Employers might be vicariously liable for the negligence of their employees during the course of employment, even when the employer has done nothing wrong. It is worth noting that the negligence committed by individual contractors does not count. Employers and human resources professionals should set clear guidelines on how the high-risk work to be delivered. Substantial supervision should also be provided to ensure a safe system at work. Labour law As an employer, you have certain responsibilities and duties to your employees, as stated in the case law and the statutes in Hong Kong. For example, rest days, holidays, wage protection and severance payment are clearly stated in the Employment Ordinance. These rights are granted to employees even when they are not stated in the contract. Therefore, you are suggested to read through the Employment Ordinance and the Minimum Wage Ordinance to understand your obligations as an employer. Work safety Employers have a duty to take reasonable care of their employees. This duty is not limited to death or injuries but also to industrial illness or disease. The duty is personal and non-delegable. You also have to take positive steps to protect the employees, for instance, providing a medical check and safety gear for employees. Employers must provide a safe working environment to their employees with consistent supervision. You might visit the Occupational Safety and Health Ordinance for the requirements of protecting the health and safety of the employees. Employers are also required to take out insurance policies that cover their potential liabilities for their employees under the Employee Compensation Ordinance. MPF Policy It is mandatory for employers and employees to make contributions to Mandatory Provident Fund (MPF). You may refer to What is the Mandatory Provident Fund