Before your first employee starts, take out employees' compensation insurance. It is compulsory for every employee, whether full-time or part-time. Enrol employees aged 18 to 64 in an MPF scheme within the first 60 days of employment and contribute 5% of their relevant income, capped at HK$1,500 a month. Pay at least the statutory minimum wage (HK$43.1 an hour from 1 May 2026), and pay wages within 7 days after the end of each wage period. File Form IR56E within 3 months of employing someone likely to be chargeable to salaries tax, and report employees on the employer's return (BIR56A and IR56B) each year.
1. Employees' compensation insurance (before day one)
- Under section 40 of the Employees' Compensation Ordinance, you can't employ anyone unless an insurance policy covers your liability under the Ordinance and at common law for work injuries. This applies to all employees, whatever the length of contract or working hours, full-time or part-time, permanent or temporary.
- Minimum cover: HK$100 million per event if you have up to 200 employees, or HK$200 million per event for more than 200.
- Display the notice of insurance, in English and Chinese, in a conspicuous place at each workplace.
- Not insuring is an offence, with a maximum fine of HK$100,000 and imprisonment for two years.
2. MPF
- Enrol full-time and part-time employees aged 18 to 64 (except exempt persons) within the first 60 days of employment, counted in calendar days. Missing the deadline carries a maximum fine of HK$350,000 and imprisonment for three years.
- Your contribution is 5% of relevant income from the first day of employment, paid with your own funds.
- The employee's contribution is also 5%, but the employee doesn't contribute for the first 30 days or the incomplete wage period that follows.
- When to pay: the contribution day is generally the 10th of each month. The first contribution for a new employee is due by the contribution day after the month in which the 60th day of employment falls.
- Give each employee a monthly pay-record within 7 working days after paying the contributions.
| Monthly relevant income | Employer | Employee |
|---|---|---|
| Less than HK$7,100 | 5% | None |
| HK$7,100 to HK$30,000 | 5% | 5% |
| More than HK$30,000 | HK$1,500 | HK$1,500 |
3. Employment Ordinance basics
- Continuous contract: from 18 January 2026, an employee is under a continuous contract after 4 weeks or more with the same employer, working at least 17 hours each week or, if any week is shorter, 68 hours or more in the four-week period. Many statutory benefits depend on this.
- Minimum wage: HK$43.1 an hour from 1 May 2026.
- Paying wages: no later than 7 days after the end of the wage period.
- Rest days: an employee under a continuous contract gets at least 1 rest day in every 7 days.
- Statutory holidays: every employee gets the statutory holidays, 15 in 2026. Holiday pay applies after 3 months under a continuous contract.
- Paid annual leave: after 12 months under a continuous contract, rising progressively from 7 to 14 days with length of service.
- MPF offsetting: for employment starting on or after 1 May 2025, you can't use the accrued benefits from your mandatory MPF contributions to offset severance or long service payments.
4. Tax forms
| Form | When |
|---|---|
| IR56E (new employee) | Within 3 months of employing a person you expect to be chargeable to salaries tax |
| BIR56A with IR56B (employer's return) | Normally issued on the first working day of April; file within 1 month of issue |
| IR56F / IR56G (employee leaving) | Not later than 1 month before the employment ends (IR56F), or 1 month before the employee's expected departure from Hong Kong (IR56G) |
Keep payroll records for at least 7 years. See our guide to the employer's return (BIR56A and IR56B).
Related service: Accounting & Bookkeeping (From HK$1,000 / year). We can keep your payroll records in order within your accounts and file the employer's return each year, and the first consultation is free.
Frequently asked questions
Do part-time staff need employees' compensation insurance?
Yes. The requirement covers all employees, whatever their working hours or contract length.
When is the first MPF contribution due for a new employee?
By the contribution day (generally the 10th) after the month in which the employee's 60th day of employment falls. Your own contributions count from the first day of employment.
Is the minimum wage a monthly amount?
No. The statutory minimum wage is an hourly rate: HK$43.1 from 1 May 2026.
Sources (official)
- Labour Department: A Guide to Employees' Compensation Insurance
- MPFA: Enrolment for employees
- MPFA: Mandatory contributions for employees
- Labour Department: Revised 'continuous contract' requirement
- Labour Department: Statutory Minimum Wage
- Labour Department: Employment Ordinance at a Glance (12/2025)
- IRD: What tax obligations do I have as an employer?
- IRD: Employers
This guide is general information, not professional advice. Government fees and deadlines can change, so check the official sources linked above.