Understanding Employment Norms in Hong Kong: A Comprehensive Guide
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Hiring in Hong Kong Read on to find out the employment norms (like taxes, payroll and benefits) and EOR (Employer on Record) norms in Hong Kong

Employment Norms in Hong Kong

Hong Kong in China is a Special Administrative Region (SAR) of the People's Republic of China. The city is one of the largest in the world raking in huge investments and businesses. The norms for Hong Kong are different from those in the rest of China. This difference may seem difficult to manage for businesses looking to expand to Hong Kong. EOR services are of great help in bridging this gap and ensuring legal compliance. EOR also helps with efficient employee management.

General Information:

  • The currency of Hong Kong is Hong Kong Dollar (HKD).
  • The capital of Hong Kong is Victoria, also called the City of Victoria.
  • Hong Kong city is a special administrative region (SAR) of China.
  • Chinese and English are the official languages of Hong Kong. Documentation can be in Chinese or English.
  • As of 2021, the GDP of Hong Kong was reported to be 369.18 billion USD.
The Employment Ordinance of Hong Kong sets all employment-related norms. It is to be referred to while setting up contracts or agreements.
Hong Kong map

Table of Contents

  • Agreements
  • Onboarding Process
  • Visa
  • Minimum Wage
  • Payroll Cycle
  • Annual Bonus
  • Health Benefits
  • Working Hours and Overtime
  • Leaves
  • Social Security
  • Taxes for Employers
  • Taxes for Employees
  • Probation
  • Termination
  • Social Security
  • Employees or Contractors
  • Final Words


  • The contract of employment may be written or oral. However, the employer is required to provide the employee with a written copy of the contract even if the agreement is oral.
  • The contract must include the following - wage details, wage period, notice period, end of-year payment details.
  • Every continuous contract is assumed to be of one month if the contract period is not mentioned in the agreement. The contract can be renewed on a month-to-month basis.
  • The employer is required to maintain wage and employment records; failing which the employer is liable to heavy fines. These records include details such as the name and identity card number of the employee, commencement, and termination of employment, wages paid, leaves, etc.
  • If the norms in the Employment Ordinance are violated, the employer is liable to heavy fines or even imprisonment in severe cases.
  • Some jobs don't fall under the Employee Ordinance of Hong Kong. The exceptions should be noted while making agreements.
  • Agreements should be in English or Chinese. If a contract is in another language, then it should be translated into these languages.
Onboarding Process

Onboarding Process

  • In case the employer hires a new employee, a notification should be sent to the Inland Revenue Department no later than three months after the employment begins. This is a mandatory process and refuting it would result in fines.
  • The details of the employee should be registered with the relevant departments.
  • The employer is required to share a written copy of the contract with the new employee.


Business visa: This applies to individuals looking to start a business using the Top Talent Pass Scheme (TTPS).
  • Those with income above 2.5 million HKD.
  • Those who hold a degree from one of the top 100 universities in the world; and may or may not have 3 years of work experience (the two categories have separate quotas).
Work visa: A work visa is granted in Hong Kong only if there is no local to fill the job. Also, the individual applying should fulfill certain requirements as per the norms. These requirements limit the number of foreign employees in a company.

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Minimum Wage

Minimum Wage

The minimum wage in Hong Kong has been37.50 HKD per hour since 2019. The rate is set to change to 40 HKD per hour (if approved) on 1 May 2023.
Payroll Cycle

Payroll Cycle

The payroll cycle in Hong Kong is monthly. Employees are usually paid on the last working day of the month.
Annual Bonus

Annual Bonus

An annual bonus is not mandatory in Hong Kong. However, it is considered a good practice to provide employees who have worked for a certain number of years to be provided an annual bonus. This is up to the terms of the contract.
Health Benefits

Health Benefits

  • Hong Kong has various healthcare services. The Health Bureau ensures Hong Kong citizens have adequate health care and no one is denied treatment due to lack of means. Certain other public departments ensure subsidized healthcare for the citizens of Hong Kong.
  • All private healthcare providers are required to be registered with the Medical Council of Hong Kong and are regulated by the same body.
Working Hours and Overtime

Working Hours and Overtime

  • Work hours:The number of working hours per week in Hong Kong is 40 hours and 8 hours per day. A typical work week consists of 5 days starting from Monday to Friday.
  • Break:A break of at least half an hour should be provided within a maximum of 5 hours of continuous work.
  • Overtime: Hong Kong does not make overtime a mandatory procedure. If required, overtime rates are decided in the agreement.


Sick Leave

  • Employees can avail of 120 days of sick leaves, out of which the first 4 days remain unpaid and are counted as a qualifying period.
  • Employees can get paid 2 paid (four-fifths of the per day wage) sick days for every month they have worked. Employees receive a sickness allowance for the paid sick days they take. A medical certificate is required.
  • 0 to 4 days of leave remain unpaid from the 5th day onwards to the 120th day employees receive 80% of their base salary paid by the employer.

Parental leaves

  • Maternity leave: Employees are granted 14 weeks of maternity leave. Paid leave is available only to employees who have worked for at least 12 months before taking the leave. Employees will be paid 80% of their average salary for the last 12 months, which is paid by the employer.
  • Paternity leave: Employees are granted 5 days of paid paternity leave if they have worked for at least 40 weeks before taking the leave. Employees will receive 80% of their average salary for the last 12 months, paid by the employer.

Annual leaves

  • An employee who has worked for at least 12 months on a continuous contract is entitled to an annual leave of 7 continuous days.
  • The number of days increases (maximum 14 days) as the number of years worked increases.

Public Holidays (for the Calendar year 2023)

The following is a list of public holidays in Hong Kong. Some dates may vary according to the traditional calendar.
  • New Year's Day (1st January)
  • The second day of Lunar New Year (23rd January)
  • The third day of the Lunar New Year (24th January)
  • The fourth day of Lunar New Year (25th January)
  • Ching Ming Festival (5th April)
  • Labor Day (1st May)
  • The Birthday of the Buddha (added since 2022) (26th May)
  • Tuen Ng Festival (22nd June)
  • Hong Kong Special Administrative Region Establishment Day (1st July)
  • The day following the Chinese Mid-Autumn Festival (30th September)
  • National Day (1st October)
  • Chung Yeung Festival (23rd October)
  • Christmas Day (25th December)

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Social Security

Social Security

  • Hong Kong has a compulsory savings (pension) fund called the Mandatory Provident Fund (MPF). The MPF provider has to be chosen by the employer and the MPF assets of the employee can be shifted to the MPF provider of another employer when the employee changes jobs.
  • Both employers and employees must contribute 5% of the employee's salary (each) to the Mandatory Provident Fund every month. The salary amount should be at least 7,100 HKD and a maximum of 30,000 HKD per month for this to be applicable.
Taxes for Employers

Taxes for Employers

Companies are required to report the wages paid to the employees in the employer's revenue report submitted annually.
Mandatory Provident Fund Rates:
  • Less than 7,100 HKD - relevant income x 5%
  • 7,100 HKD to 30,000 HKD - relevant income x 5%
  • more than 30,000 HKD - $1,500

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Taxes for Employees

Taxes for Employees

In Hong Kong, the employer is not required to withhold and pay the employee's taxes. The employees have to file their taxes on their own to the Inland Revenue Department (IRD). The income tax applies only to the income earned in Hong Kong.
Mandatory Provident Fund Rates:
  • Less than 7,100 HKD - relevant income x 5%
  • 7,100 HKD to 30,000 HKD - relevant income x 5%
  • more than 30,000 HKD - $1,500
The income tax brackets are given below.
  • First HKD 50,000 - 2%
  • HKD 50,001 to HKD 100,000 - 6%
  • HKD 100,001 to HKD 150,000 - 10%
  • HKD 150,001 to HKD 200,000 - 14%
  • Above HKD 200,000 - 17%


The probation period in Hong Kong is not more than 12 weeks (or 3 months). The tenure should be clearly defined in the employment contract.

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  • Employee or employer is required to give notice to the other party in case of termination of the contract. If there is no stipulated notice period in the contract, the notice period is at least one month.
  • For employees in probation period, notice is not required within the first month of probation. After the first month of probation, at least a 7-day notice is required or as per the notice period agreed upon in the contract.
  • The employer must inform the Inland Revenue Department (IRD) at least one month before an employee is dismissed. For employees leaving Hong Kong, the IRD must issue a “letter of release” until which the employer has to withhold all payments to the employee.
Social Security

Social Security

  • Employees who have worked for at least 24 months are eligible for severance pay. This is in case the employee is laid off or dismissed for redundancy.
  • In Hong Kong, employees dismissed after working for more than 5 years are eligible for long service payment. This is calculated in the same way as severance pay. However, the reason for dismissals in this case include -
    • expiry of the contract,
    • ill health,
    • resignation of employees above 65,
    • death of the employee,
    • dismissal not due to redundancy or misconduct.
  • Employees receive two-thirds of their monthly wage (up to 15,000 HKD) multiplied by the number of years they have worked.
Employees or Contractors

Employees or Contractors

  • Employees and contractors have almost the same benefits since the minimum contractual period in Hong Kong is one month. Also, the taxes have to be handled by the individuals themselves.
  • Contractors, full-time employees, and self-employed individuals are treated differently in Hong Kong. Misclassifying them can lead to fines and penalties.
Final Words

Final Words

Being well-known for its financial sector, Hong Kong attracts top businesses from across the world. The availability of highly skilled employees in Hong Kong is another good reason to consider expanding business there. EOR services greatly simplify employee management and ensure hassle-free processes.

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