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Written Agreements

According to Hong Kong law, a contract of employment is an agreement on terms and conditions of employment made between an employer and an employee. The agreement can be made orally or in writing and includes both express and implied terms.

Before employment starts, an employer must inform each employee of the terms and conditions of employment with regard to:

• Wages (including the rate of wages, overtime rate, and any allowance, whether calculated by piece, job, hour, day, or week)
• Wage period
• Length of notice required for the contract termination
• The end-of-year payment (if applicable) or proportion thereof, as well as the payment period

If the employment contract is in writing, the employer must provide 1 copy of the written agreement to the employee for retention and reference. If the contract is not in writing, the employee can make a written request (before entering employment) to have the agreement in written format.

Oral Agreements

An employment contract can be made orally or in writing and includes express and implied terms.

An employer must inform employees of the following conditions before employment begins:

• Wages (including the rate of wages, overtime rate, and any allowance, whether calculated by piece, job, hour, day, or week)
• Wage period
• Length of notice for termination of the employment agreement
• The end-of-year payment (if applicable) and the payment period

If the agreement is not concluded in writing, the employee can submit a written request to the employer to provide the above conditions and terms in writing. This request must be submitted before the start of employment.

In case there are changes in the conditions of service, or whether they have merely been proposed to employees, employers must inform them in an intelligible manner. If a change in terms of service is recorded in writing, a copy of the written amendment must be provided to an employee.

Implied Agreements

Key terms implied by Hong Kong's Employment Ordinance are:

• Right to pay in lieu of notice of termination
• Restrictions on employer’s right to suspend employees
• The right to severance and/or long service payments
• The employee’s entitlement to rest days, statutory holidays, annual leave, sick leave, and maternity or paternity leave

Employees are implied to have a duty to:

• Obey lawful orders within the scope of employment
• Act in good faith towards the employer
• Not disclose trade secrets or confidential information

An employment contract must be made in writing or orally.

The labor code of Hong Kong does not define standard working hours. An employee who has worked for at least 18 hours per week for 4 weeks for the same employer is considered to be employed under a continuous employment contract. The law does limit the number of working hours to 8 hours per day and 48 hours per week for young persons between the age of 15 and 18 years.

An employee under a continuous employment contract is entitled to at least 1 rest day every 7 days. A rest day is defined as a continuous period of at least 24 hours during which an employee is entitled to abstain from working.

An employee, regardless of the length of service, is entitled to the following statutory holidays:

• New Year - January 1
• Lunar New Year’s Day - date subject to change every year
• Second and third days of Lunar New Year - dates subject to change every year
• Ching Ming Festival - date subject to change every year
• Good Friday - date subject to change every year
• Day after Good Friday - date subject to change every year
• Easter Monday - date subject to change every year
• Labor Day - May 1
• Birthday of the Buddha - date subject to change every year
• Tuen Ng Festival - date subject to change every year
• Hong Kong Special Administrative Region Establishment Day - July 1
• National Day - October 1
• The day following the Chinese Mid-Autumn Festival - date subject to change every year
• Chung Yeung Festival - date subject to change every year
• Christmas Day - December 1
• The first weekday after Christmas - date subject to change every year

If any of the holidays fall on a Sunday, the next day is declared a holiday.

According to the Employment Ordinance of Hong Kong, an employment contract can include a probationary period. There is no statutory limit on the duration of probation.

If an employee is on probation and the contract does not make provision for the length of notice required for its termination, such agreement can be terminated by either party at any time during the first month of such employment without notice or payment in lieu, and by giving a notice period of 7 days after the first month. If the contract includes a notice period clause, it can still be terminated without notice during the first month. After the first month, it can be terminated with the determined notice period.

Notice Period

An employee or an employer can terminate the employment contract by giving notice to the other party verbally or in writing. The length of the notice period is as follows:

• For employment contracts renewable from month to month, the notice period is to be at least 1 month.
• In other cases, the notice period would be the one that is agreed to in the employment contract (cannot be under 7 days).

Employment contract can be terminated without giving notice by making a payment equal to the wages for the number of days of notice agreed upon.

An employer can summarily dismiss an employee without notice or payment in lieu of notice in case of gross misconduct. However, an employee taking part in a strike is not a lawful ground for an employer to terminate the contract without notice or payment in lieu.

Severance Benefits

Employees are eligible for severance pay if they have been employed for at least 24 months and are either dismissed by the employer due to economic redundancy or laid off as the employer is not able to provide work for at least half of the total regular working hours for a period of 4 consecutive weeks. The amount of severance pay is calculated as follows for every year of employment:

• For a monthly-paid employee, the benefit is equal to two-thirds of the last full month’s salary or HKD 22,500, whichever is lower.
• For other employees, the severance pay is equal to 18 days of wages based on any 18 days chosen by the employee and occurring during the last 30 regular working days, or two-thirds of HKD 22,500, whichever is lower.

Beginning May 1, 2025, the benefit paid to a monthly-paid employee will be equal to two-thirds of the last full month's salary immediately preceding the transition date, or HKD 22,500, whichever is lower.

There is no entitlement to severance benefits if the dismissal is based on employee conduct. Severance pay is not issued if the employer has offered to renew the employment contract at least 7 days before the contract termination date, but the employee has refused the offer unreasonably.

Minimum Wage

The statutory minimum wage rate is HKD 42.10 (Hong Kong dollars) per hour.

Employment laws consider 1 month to be the wage period unless otherwise agreed. Wages are due on the last day of the wage period and no later than 7 days after it. Employers are required to pay interest on any outstanding wage and are liable to prosecution if they fail to pay wages without a reasonable excuse.

Overtime, Holiday & Vacation Pay

With no statutory guidance on overtime pay, practice the recommended practice is to state in an employment agreement whether overtime is paid or unpaid, and the rate of pay, if applicable.

Whether an employee is paid for their weekly rest day is to be agreed by employers and employees. If an employee is required to work on a statutory holiday, the employer can grant an alternative holiday on another day within 60 days. An employer must not make any form of payment to the employee in lieu of granting a holiday.

A person who has been employed under a continuous contract for a minimum of 3 months immediately preceding a statutory holiday is entitled to the holiday pay. It is paid not later than the day on which the employee is next paid their wages after that statutory holiday.

The daily rate of holiday and annual leave pay is a sum equal to the average daily wages earned by the employee in the 12-month period preceding the holiday or leave. If a person is employed for under 12 months, the calculation shall be based on that period.

Visas

• Transit visa - issued to individuals traveling to other locations via Hong Kong
• Visitor visa - issued to individuals who are traveling to Hong Kong for recreational purposes
• Employment visas - issued to foreign nationals with an employment contract to work in Hong Kong. The visa is valid for 1 year and renewable.
• Investment visas - issued to individuals investing in Hong Kong and their partner or spouse
• Entrepreneur visas - issued to individuals starting a business in Hong Kong
• Dependent visas - issued to spouses, partners, or children of individuals who are admitted to Hong Kong on an applicable visa
• Student visas - issued to foreign nationals enrolled in full-time educational programs or internships in Hong Kong with a school acceptance letter and the ability to meet financial requirements. For an internship, the duration of stay is 12 months.
• Other visas (Imported Workers, Foreign Domestic Helpers)

Work Permits

Short-term visitors are permitted to conduct business negotiations and sign contracts while on a visitor’s visa or entry permit. Eligibility requirements to apply for a work permit include:

• The applicant has no known record of serious crime in the past.
• The applicant has a sufficient educational background, usually a degree in the relevant field, but in special circumstances, proper technical qualifications, proven professional abilities, and/or relevant experience and achievements supported by documentary evidence may also be accepted.
• There is a genuine employment vacancy for the applicant to fill.
• The applicant has a confirmed employment offer and is hired for a job relevant to their academic qualifications or work experience that cannot be readily taken up by the local workforce.
• The remuneration package (income, accommodation, medical, and other fringe benefits) is broadly commensurate with the prevailing market level for professionals in Hong Kong.

The work permit is issued for a year and is renewable.