Are you planning to hire employees in Hong Kong? Understanding and complying with the statutory minimum wage per the Minimum Wage Ordinance is crucial for employers.
Hong Kong’s minimum wage laws aim to provide a safety net for workers and prevent exploitative labor practices. Non-compliance with these laws can result in severe penalties such as fines and imprisonment.
Therefore, in this guide, we’ll break down the essential aspects of minimum wage requirements in Hong Kong.
What is the Statutory Minimum Wage in Hong Kong
As per Hong Kong’s Minimum Wage Ordinance, the current Statutory Minimum Wage in Hong Kong is HKD 40 per hour. This was last updated on 1st May 2023 and applies to all employees unless otherwise specified.
Keep in mind that, as an employer, you are not allowed to pay employees less than the minimum wage. If an employee’s hourly wage average falls below the minimum wage, the employer must pay them an additional remuneration to meet the minimum wage requirement.
Who is Covered by the Minimum Wage Ordinance?
The statutory minimum wage in Hong Kong applies to all employees regardless of their industry, payment period (hourly, weekly, monthly), or contract type (full-time, part-time, or others).
However, there are a few exceptions where the minimum wage requirements don’t apply. These include:
- Domestic workers who live free of charge in the house where they work (Live-in domestic workers)
- Specified student interns and work experience students
- People who are not covered by the Employment Ordinance (covered under a different ordinance such as the Apprenticeship Ordinance or the Contracts for Employment Outside Hong Kong Ordinance)
Employees with disabilities are also entitled to the statutory minimum wage unless they opt for a voluntary productivity assessment. This test is done to determine whether they should be paid at a rate corresponding to their productivity or not.
However, only the employees with disabilities, not the employer, have the right to request this assessment.
In addition to that, employers are not allowed to sign any contracts with their employees that take away their rights. Any part of a work contract that tries to take away or lessen any rights, benefits, or protections given to an employee under the Minimum Wage Ordinance is not valid.
Components of Minimum Wage in Hong Kong
Minimum wages in Hong Kong include almost all forms of payment to an employee, such as
- Salaries
- Allowances
- Commissions
- Overtime
- Tips, etc
This means anything you earn in return for the work you do counts towards meeting the minimum wage.
However, keep in mind that payments made for time not considered “hours worked,” such as rest day pay, holiday pay, annual leave pay, maternity leave pay, paternity leave pay, and sickness allowance, are not counted as wages for the minimum wage calculation
How to Calculate the Minimum Wage in Hong Kong?
The minimum wage in Hong Kong is calculated by multiplying the number of hours an employee has worked with the statutory minimum wage of HKD 40.
Minimum Wage = Number of hours worked during a wage period × HKD 40 (current statutory minimum wage rate in Hong Kong)
For example, if you worked 40 hours in a pay period, your minimum wage calculation would be 40 hours * HKD 40 = HKD 1,600.
Minimum Wage Calculator Hong Kong
Enter the number of hours worked:
Disclaimer: This calculator is provided for reference purposes only. Actual wages you receive may vary based on additional factors not accounted for in this calculation.
Consequences of Non-Compliance with Minimum Wage Laws
In Hong Kong, any employer who fails to pay employees the mandated minimum wage is considered in violation of the Employment Ordinance. In such cases, employers found guilty of willfully neglecting to pay wages without any good reason may be subject to a fine of up to HKD 350,000 and imprisonment for up to three years.
Moreover, if a company commits this offense and it’s found that a director, manager, secretary, or any senior officer was involved or negligent, that individual could also be charged and face the same penalties.
