In this course · 1 of 5
Course 6
Grow, hire or close
5 lessons · 5 min
- 1What do I need to do when hiring my first employee in Hong Kong?
- 2Can an online store use freelancers or overseas staff, and what changes for the owner?
- 3How do I transfer my sole proprietorship online store to a Hong Kong limited company?
- 4How do I close an online store run as a sole proprietorship in Hong Kong?
- 5How do I deregister or close a Hong Kong limited company that ran an online store?
The short answer
Employers in Hong Kong must enrol eligible employees in a Mandatory Provident Fund (MPF) scheme, take out employees' compensation insurance, pay at least the statutory minimum wage, and report to the Inland Revenue Department (IRD). Keep a written employment arrangement and records of pay.
Hiring a first employee, including part-time or fulfilment staff, brings several legal duties:
- Employment Ordinance: covers wages, rest days, holidays and termination. Employees under a continuous contract (generally 18 hours a week for four weeks) get additional statutory benefits.
- Minimum wage: the Minimum Wage Ordinance sets an hourly rate; check the Labour Department for the current figure.
- MPF: an employer must enrol employees aged 18 to 64 in a Mandatory Provident Fund scheme, normally within 60 days of the start of employment. Employer and employee each generally contribute 5% of relevant income, within minimum and maximum income levels.
- Employees' compensation insurance: compulsory for all employees under the Employees' Compensation Ordinance.
- Tax reporting: employers notify the IRD of new employees and file annual employer's returns.
A sole proprietor who is self-employed also has MPF obligations. Freelancers are not automatically treated as non-employees, as the real nature of the working relationship counts. Check the details with the Labour Department and MPFA.
Legal basis and sources
The law
- Employment Ordinance (Cap. 57)
- Mandatory Provident Fund Schemes Ordinance (Cap. 485)
- Employees' Compensation Ordinance (Cap. 282)
- Minimum Wage Ordinance (Cap. 608)
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
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