Employer of Record in Hong Kong

Hiring independent contractors has boomed in popularity because of the cost savings and flexibility they offer. It can be a great option if you require niche skills or short-term project support. Contractors allow businesses to access specialized skills quickly, without the time and cost of setting up a local entity.

However, it’s important to know the limits of this model: contractors are not a substitute for full-time employees. Relying on them for ongoing, long-term roles can create serious compliance risks, including employee misclassification, which can lead to fines, back taxes, and reputational damage.

Playroll’s contractor management solutions make it simple to compliantly engage, onboard, and pay contractors around the world. We provide clear visibility into agreements, streamline payments, and reduce compliance risks – so you can focus on getting the work done. And when you’re ready to take the next step, we can help seamlessly convert contractors into full-time employees through our global Employer of Record service.

Businesses can only operate smoothly in Hong Kong if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Hong Kong below, to avoid any compliance issues.

Employment Contract Requirements

Navigating Hong Kong's dynamic business environment with international outlooks and sophisticated regulations is essential when initiating the employment process, which involves adhering to several formalities:

• Provide a comprehensive offer letter detailing the terms of employment.
• Specify the date of commencement of employment.
• Outline the employee's ordinary working days and hours.
• Clearly define the probationary period within the employment contract.

Onboarding Process

We can help you get a new employee started in Hong Kong quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations. For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.

Working Hours in Hong Kong

In Hong Kong, typical working hours are from 9 am to 6 pm, Monday to Friday, with no legal limitations on maximum working hours for adults. However, individuals aged 15 to 18 working in industrial settings are restricted to an 8-hour workday between 7 am and 7 pm, with a weekly limit of 48 hours.

Overtime in Hong Kong

Overtime regulations in Hong Kong are generally specified by the company's policy, which is usually outlined in either the employment contract or the Collective Bargaining Agreement.

Probation Period in Hong Kong

The probation period in Hong Kong for permanent employees is generally set between 1 month to 6 months.

Hiring in Hong Kong means navigating local labor laws, mandatory employee benefits, payroll taxes, and strict employment regulations. These requirements aren’t always intuitive, especially if your team lacks in-country legal or HR expertise. An Employer of Record steps in as the legal employer for your hires, managing all compliance-related responsibilities. This includes issuing locally compliant contracts, registering employees with relevant authorities, processing payroll, and handling social security contributions and taxes in line with national laws.

By handing over these complexities to an EOR, your business avoids costly compliance errors and the time required to master local employment standards. You can focus on growing your team and operations while trusting that the legal and administrative foundation is solid. Whether you're making one strategic hire or building out an entire team, the EOR keeps you compliant, removes guesswork, and reduces the risk of legal or financial penalties, without requiring you to open a legal entity or maintain a local HR team.

Fiscal Year in Hong Kong

1 April - 31 March is the 12-month accounting period that businesses in Hong Kong use for financial and tax reporting purposes.

Payroll Cycle in Hong Kong

The payroll cycle in Hong Kong is usually monthly, with employees being paid by the last working day of the month.

Minimum Wage in Hong Kong

As of May 1, 2025, Hong Kong's minimum wage is set at HKD 42.10 per hour. This rate applies to all workers, and the government periodically reviews and adjusts the wage based on economic conditions.

Bonus Payments in Hong Kong

It is customary to pay a 13th salary before the Chinese Lunar New Year or at the end of the year.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 0% - 17% on top of the employee salary in Hong Kong.

Employee Payroll Tax Contributions

In Hong Kong , the typical estimation for employee payroll contributions cost is around 5%.

Individual Income Tax Contributions

Income tax in Hong Kong is 'Pay As You Earn'. The individual income tax ranges from 2% to 17%.

Pension in Hong Kong

In Hong Kong, the Mandatory Provident Fund (MPF) system serves as the primary pension scheme, requiring both employers and employees to make contributions to retirement funds managed by private trustees.

Running payroll in Hong Kong is complex, especially when you're hiring without a local entity. Local laws determine everything from tax withholdings and reporting deadlines to benefit contributions and currency requirements. Missteps can lead to fines, payment delays, or unhappy employees. An Employer of Record takes this burden off your plate by handling the full payroll process. Acting as the legal employer, the EOR ensures you remain compliant with all payroll-related obligations, while still allowing you to manage your team’s day-to-day work and performance.

Key Ways an EOR Supports Payroll in Hong Kong:

• Compliance Assurance: Ensures payroll aligns with local tax laws, labor regulations, and statutory deadlines.
• Payroll Processing & Tax Management: Calculates salaries, applies correct tax withholdings, and submits required reports.
• Benefits & Social Security Contributions: Manages employer obligations for pensions, health insurance, and other legal entitlements.
• Contract Generation & HR Administration: Drafts compliant employment contracts and supports onboarding, terminations, and HR tasks.
• Currency Payments: Issues timely salary payments in local currency, ensuring employees are paid accurately and on time.

In Hong Kong, work permits and visas are crucial for employers hiring international talent. Key visas include the General Employment Policy (GEP) Visa, Admission Scheme for Mainland Talents and Professionals (ASMTP), Immigration Arrangements for Non-local Graduates (IANG), Top Talent Pass Scheme (TTPS), and others.

Employers must navigate specific eligibility criteria, sponsorship processes, and renewal periods to ensure compliance with local immigration laws.

Mandatory Leave Entitlement in Hong Kong

The annual leave entitlement in Hong Kong is 8 - 14 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays In Hong Kong

Hong Kong has 13 mandatory national public holidays in a year.

Paid Time Off in Hong Kong

Employees with a minimum of 12 months of employment receive 7 days of paid annual leave, which increases by one day per additional year of service until reaching a maximum entitlement of 14 days in the ninth year of employment.

Maternity Leave In Hong Kong

In Hong Kong, a pregnant employee with a continuous contract of at least 40 weeks is entitled to 14 weeks of paid maternity leave, with an additional 14 weeks available for complicated or multiple births, beginning between two to four weeks before the due date.

Paternity Leave In Hong Kong

In Hong Kong, male employees with a continuous contract of at least 40 weeks before the first day of paternity leave can take 5 days of leave. This leave can be taken consecutively or on separate days within four weeks before the expected delivery date and up to 14 weeks after the actual birth of the child.

Sick Leave In Hong Kong

During the initial 12 months of employment, employees accrue 2 paid sick days per month. The following are also relevant to sick leave in Hong Kong:

• After completing one year of service, the accrual increases to 4 paid sick days per month.
• The maximum accumulation of paid sickness days is capped at 120.
• Sick pay is calculated at 80% of the average daily earnings in the preceding 12-month period before the first day of sickness for employees with more than 12 months of service.
• For employees with less than 12 months of service, sick pay is based on average earnings since the employment start date.

Parental Leave In Hong Kong

There is no statutory provision for shared parental leave in Hong Kong.

Administering employee benefits in Hong Kong requires more than just offering a standard package. Local labor laws often mandate specific entitlements, from health insurance to paid leave, and the rules can change without warning. Hong Kong also has unique standards for what an attractive, competitive benefits package looks like. For businesses without in-country expertise, meeting these obligations and expectations can quickly become risky and expensive. An Employer of Record acts as your compliance partner, ensuring all benefits are provided according to the latest legal requirements and without administrative strain on your internal team.

Beyond compliance, an EOR brings clarity and consistency to a process that’s often complex and fragmented. They handle enrollments, ensure accurate employer contributions, manage communications with local providers, and keep everything properly documented. This means employees get what they’re entitled to, and you avoid the headache of navigating benefits systems in a foreign market. Whether you're hiring one person or building a larger team, an EOR provides a clear, dependable structure that lets you offer competitive benefits without taking on unnecessary risk or workload.

Termination Process in Hong Kong

The Employment Ordinance in Hong Kong outlines valid termination reasons, including:

• Employee misconduct
• Employee's capability or qualifications to perform their job
• Redundancy

Notice Period in Hong Kong

In Hong Kong, notice periods are typically 30 days, although employers can stipulate longer periods in employment contracts. If the contract specifies a notice period, it cannot be shorter than seven days. In the absence of a specified period, the default notice period is one month. During the probation period, a seven-day notice is obligatory.

Severance in Hong Kong

Employees with at least two years of continuous service are entitled to statutory severance payment in the event of redundancy.