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MPF and workers’ compensation insurance are mandatory.
Mandatory Provident Fund Schemes
In Hong Kong, there is the so-called Mandatory Provident Fund (MPF) pension system. The MPF requires employers to arrange for employees aged between 18 and 65 to join an MPF scheme as long as they have been employed for 60 days and to make contributions for the first 60 days.
However, if the employee leaves the company before the 60th day of employment, the employee is not eligible to become a member of an MPF scheme and the employer is not required to make contributions for this period of employment.
Employees’ Compensation Insurance
Under section 40 of the Employees’ Compensation Ordinance, all employers are required to take out employees’ compensation insurance to cover the employer’s liabilities under the law (including the common law), failing which the employer shall not employ an employee to do any work, irrespective of the duration of the contract or the number of hours of work, whether full-time or part-time. Employers should seek professional advice if they do not understand their liabilities.
The minimum insured amount for Employees’ Compensation Insurance is as follows:
No.of employees
Not more than 200 persons
Insured amount per accident
Not less than HKD100 million
No.of employees
Over 200 persons
Insured amount per accident
Not less than HKD200 million
Employers who fail to take out employees’ compensation insurance in accordance with the law are liable to prosecution and, upon conviction, to a maximum fine of HK$100,000 and imprisonment for two years.
