Easily hire employees in Hong Kong
ATA PEO Services simplifies the process of hiring employees in Hong Kong for your business, alleviating concerns related to navigating local regulations, intricate tax structures, and overseeing global payroll. With ATA’s comprehensive support, your international hiring needs are expertly managed.
You can hire employees in Hong Kong without the need for an entity.
Typically, to hire employees in Hong Kong, your business must have an entity, which involves establishing a local office, registering an address as a subsidiary, and opening an account with a local bank. Managing regional benefits, payroll, tax, and HR laws throughout this process can take several months.
Hong Kong has separate regulations for contractors compared to full-time employees, making it crucial to avoid misclassification to avoid potential penalties. ATA streamlines the process of hiring employees in Hong Kong, ensuring speed, simplicity, and compliance. Additionally, our platform automates tasks such as tax document collection, payroll, benefits, and more.
Our quickstart guide to hiring in Hong Kong
Navigate the tabs below to learn everything you need to know about hiring an employee in Hong Kong
- Pay & Tax
- The Statutory Minimum Wage in Hong Kong has been set at HKD 40 per hour, effective from May 1, 2023. For employers who maintain a record of total hours worked by their employees, the monthly wage ceiling is HKD 16,300.
- Individual Income Tax
- The range of individual income tax in Hong Kong varies from 2% to 17%, calculated on income after deductions and allowances.
| Type of leave | Time period |
|---|---|
| Annual leave/Earned Leave | 7 days |
| Sick Leave | 24 days |
| Maternity Leave | 14 weeks |
The termination process in Hong Kong generally involves a reasonable notice period that must be given by either party. Certain conditions and procedures apply depending on the reason for termination. In some cases, such as redundancy or the cessation of business operations, filing may not be required. Additional requirements for dismissal can vary based on the reason for termination, as outlined below.
| Reason for Termination | On the last day of employment |
|---|---|
| Expiry of the employment contract | No notice is required if the contract ends as agreed, based on the contract terms. |
| Dismissal by employer (other than summary dismissal) | Notice or payment in lieu of notice is required as per contract terms, typically 1 month unless otherwise agreed. |
| Resignation by employee | Notice period must be followed as per contract terms, typically 1 month unless otherwise agreed. |
| Summary dismissal by employer | Immediate termination without notice for gross misconduct, with no notice period required. |
- During the probationary period (first month), either party may terminate the contract without notice or payment in lieu. After that, a minimum of seven days’ notice is required unless otherwise agreed.
- For contracts with a longer duration, the notice period is typically 1 month. In the absence of an agreed notice period, either party may terminate the contract with 1 months’ notice or payment in lieu.
- Severance pay is applicable if the employee has been continuously employed for at least 24 months and is terminated due to redundancy.
- Statutory severance pay is calculated as 2/3 of the employee’s last month’s wages for each year of service, up to a maximum of HKD 390,000.
- In case of long service payment, an employee who has been employed for 5 years or more and is dismissed (other than summary dismissal) may be entitled to long service payment. This payment is calculated similarly to severance pay.
- Note: Employers may deduct gratuities or retirement scheme benefits from the severance or long service payment.
- Employee contract in Hong Kong
- In Hong Kong, employment contracts must be provided in writing, and they are generally drafted in Chinese or English. The contract should clearly outline the key terms and conditions of employment, including the job description, salary, benefits, working hours, leave entitlements, allowances, and other provisions relevant to the employment relationship. While an employer is not required by law to provide a written contract, it is a common practice to protect both parties’ interests. It is also recommended to ensure that the contract complies with the provisions of the Employment Ordinance.
- Probation period
- Under Hong Kong employment law, probation periods are typically included in employment contracts, but there is no statutory limit on the length of a probation period. The duration is generally agreed upon between the employer and the employee. Probation periods in Hong Kong typically range from one to three months, depending on the employer’s policies and the role in question. During the probationary period, either party can terminate the contract with a shorter notice period (usually one week), unless otherwise agreed. Once the probation period ends, the employee is entitled to full statutory benefits under the Employment Ordinance, such as annual leave, sick leave, and other entitlements.
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