Employment Law in Hong Kong

Hong Kong is a special administrative region (SAR) of the People’s Republic of China (PRC). It has a devolved legislature, executive and judiciary, including its own separate employment legislation and labour courts.

The key item of employment legislation is the Employment Ordinance, which applies to almost all employees (with some exceptions such as seafarers and certain employees in family businesses). The Ordinance covers matters such as employment contracts, probationary periods, information on employment conditions, payment of wages, deductions from wages, public holidays, trade union rights, prohibition of dismissal on certain grounds and some other aspects of termination. However, the Ordinance restricts certain of its entitlements to employees with “continuous contracts”, ie those who have at least four weeks’ service and work at least 18 hours per week (see Types of Contract). Notably, only these employees have statutory rights in relation to rest days, annual leave, maternity leave, paternity leave, sick leave, pay on public holidays, severance payments, long-service payments, end-of-year payments and protection from unreasonable dismissal.

Other significant laws include the Minimum Wages Ordinance, Sex Discrimination Ordinance, Race Discrimination Ordinance, Disability Discrimination Ordinance, Family Status Discrimination Ordinance, Trade Unions Ordinance, Labour Relations Ordinance, Occupational Safety and Health Ordinance, Apprenticeship Ordinance and Personal Data (Privacy) Ordinance. Case law interprets all the legislation relevant to employment. Employment contracts also play an important part in governing the employment relationship (collective agreements are rare and have only a very minor role).

This article refers to employment law in the private sector only.

• Recruitment and selection are subject to little statutory regulation, except in relation to data protection and non-discrimination. Recruitment and Selection

• During the first month of a probationary period, either party is entitled to terminate the employment contract without notice. Recruitment and Selection

• Most foreign nationals require prior permission from the governmental Immigration Department to work in Hong Kong, typically by obtaining an employment visa under the General Employment Policy scheme. Recruitment and Selection

• An employment contract is defined as any agreement, written or oral, express or implied, whereby one person agrees to employ another person and the latter agrees to serve the employer as an employee. Employment Contracts

• Before employment starts, the employer must inform the employee in detail about the conditions relating to wages, the wage period, notice periods and end-of-year payments. Employment Contracts

• Only employees with “continuous contracts” — ie those who have at least four weeks’ service and work at least 18 hours per week — have certain employment rights, notably in relation to paid leave, termination-related payments and dismissal protection. Employment Contracts

• Employers must generally pay employees once a month — in cash or, with the employee’s consent, into their bank account or by cheque or postal/money order — and must observe rules on deductions from pay. There is a statutory minimum wage. Pay and Benefits

• It is common for employees to receive an annual bonus, known as an end-of-year payment, which is subject to various statutory rules. Pay and Benefits

• There is no statutory regulation of working hours or of overtime for adult employees. Working Time, Rest and Holidays

• Employees on continuous contracts must be granted at least one rest day in every seven-day period. Working Time, Rest and Holidays

• Employees on continuous contracts are entitled to paid annual leave, starting at seven days’ leave after one year of service and rising to 14 days after nine years’ service. Working Time, Rest and Holidays

• Working parents on continuous contracts are entitled to take paid maternity leave (normally 10 weeks) or paid paternity leave (five days). Parenthood and Work-life Balance

• Employees on continuous contracts are entitled to paid sick leave. Parenthood and Work-life Balance

• Direct and indirect discrimination in relation to employment is prohibited on the grounds of sex (including marital status and pregnancy), race, disability or family status. Equality and Discrimination

• Sexual harassment and harassment on grounds of race or disability are unlawful in the employment context. Equality and Discrimination

• Employees have a right to set up and join trade unions and engage in various union activities, and are protected from discrimination or dismissal for exercising their trade union rights. Industrial Relations and Collective Rights

• Collective bargaining and agreements are not governed by statute, and employers’ recognition of unions is entirely voluntary. Industrial Relations and Collective Rights

• Employees have a constitutional right to strike and participation in a strike is not a valid reason for summary dismissal. Industrial Relations and Collective Rights

• Employers have a duty, so far as reasonably practicable, to ensure the safety and health at work of all their employees. They also have a range of specific obligations in this area, especially in the case of factories and industrial undertakings. Occupational Health and Safety

• In principle, an employer may terminate the employment contract at any time by giving the required notice, and may also dismiss an employee without notice on certain misconduct-related grounds; however, some reasons for dismissal are unlawful and, in the case of employees on continuous contracts with at least two years’ service, the employer requires a specific valid reason for dismissal with notice. Termination of Employment

• The notice period for termination of the employment contract by either the employer or employee must be at least seven days (after any probationary period). Termination of Employment

• Employees who are made redundant may be entitled to a severance payment, while those who are dismissed on other grounds (except summarily for misconduct) or leave employment for various other reasons after a long period of service may be entitled to a long-service payment. Termination of Employment

• When there is a business transfer, employees’ employment contracts are not automatically transferred to the new employer.

• Employers must observe statutory data-protection rules when collecting and using the personal data of employees and job applicants.