Employer of Record in Hong Kong

An Employer of Record (EOR) is a company that legally hires employees on your behalf in Hong Kong. This means you can build a team in a new country without setting up your own local entity. The EOR handles all the essential HR tasks like payroll, taxes, benefits, and compliance with local labor laws. It’s a straightforward way to hire talent while you focus on your business goals. For companies looking to expand, providers like Rivermate offer these services to simplify international hiring.

How an Employer of Record (EOR) Works in Hong Kong

Using an EOR in Hong Kong streamlines the hiring process. You find the talent, and the EOR legally employs them for you.

Here is how it typically works:

1. You select your candidate. You are still in complete control of interviewing and choosing who you want to hire.
2. The EOR prepares a local contract. The EOR drafts an employment agreement that complies with all of Hong Kong's labor laws.
3. The EOR onboards your new employee. They handle all the necessary paperwork to get your new team member set up correctly.
4. They manage payroll and benefits. The EOR processes salary payments, handles tax withholdings, and manages statutory benefits like the Mandatory Provident Fund (MPF).
5. You manage daily work. Your employee works for your company, following your direction and contributing to your projects. The EOR simply handles the legal and administrative side of their employment.

Benefits of Using an EOR for Hiring in Hong Kong

Using an EOR gives you a significant advantage when expanding into the Hong Kong market. It allows you to hire employees quickly and legally, without the major investment of time and money required to establish a local company.

Here are some of the key benefits:

• Faster Market Entry. You can onboard new employees in a matter of days or weeks, instead of the months it can take to set up a legal entity.
• Compliance Assurance. EORs are experts in local labor laws, ensuring that your hiring practices are fully compliant with Hong Kong's regulations. This reduces the risk of legal issues.
• Cost Savings. You avoid the high costs associated with company registration, legal fees, and setting up local payroll systems.
• Focus on Your Business. With the administrative and legal burdens handled by the EOR, you can concentrate on your core business operations and managing your team.

Rivermate's transparent pricing model eliminates complexity with a single, competitive monthly fee per employee. Unlike traditional PEO providers, our pricing in Hong Kong includes comprehensive HR support, benefits administration, compliance management, and access to our proprietary dashboard for real-time workforce analytics. No hidden costs, no setup fees—just straightforward pricing that scales with your business needs while ensuring full legal compliance in Hong Kong.

Hiring in Hong Kong is straightforward, but you need to know the local rules. The city's fast-paced business culture, a mix of Eastern and Western practices, makes it a competitive place to find talent. While the laws are employer-friendly, making sure you follow them is key to building a strong team.

Employment contracts & must-have clauses

While you can make a verbal agreement, a written employment contract is always the best approach. It creates clarity and helps avoid disputes down the road. If an employee asks for a written contract, you are required to provide one.

Your contract should clearly state all employment conditions. Any clause that tries to reduce an employee's rights under the Employment Ordinance is not valid.

Here are the essential details to include:

• Wages: State the salary, how often it's paid, and any allowances or bonuses.
• Working Hours: Specify regular hours, rest periods, and how overtime is handled.
• Notice Period: Define the notice required from either you or the employee to end the contract.
• Job Details: Include the job title and a clear description of responsibilities.
• Leave: Outline all leave entitlements, including annual leave and sick leave.
• Probation: If there's a probation period, state its length and terms.
• Termination: Explain the reasons for termination and any related payments.

Probation periods

Probation periods are common in Hong Kong and help both you and your new hire decide if the fit is right. They typically last from one to three months but can be longer for more senior roles.

Here’s how termination works during probation:

• First month: Either you or the employee can end the contract without giving any notice.
• After the first month: A minimum of seven days' notice is required.

These terms must be clearly stated in the employment contract to be legally compliant.

Working hours & overtime

Hong Kong does not have a standard work week or legal limits on working hours for most employees. Working hours and overtime arrangements are negotiated between you and your employee and should be included in the employment contract.

While there's no law requiring overtime pay, if your contract states that it will be paid, you are legally required to pay it.

Public & regional holidays

In 2025, Hong Kong has 17 general public holidays. You are required to provide employees with 14 paid statutory holidays.

Statutory Holidays for 2025

Source: Hong Kong Labour Department

If a statutory holiday falls on a rest day, you must grant the holiday on the following day.

Hiring contractors in Hong Kong

Hiring independent contractors in Hong Kong gives you access to specialized skills without the commitment of a full-time employee. Contractors are considered self-employed for tax purposes and are not covered by the same employment laws as employees. This means you are not required to provide them with benefits like paid leave or social security contributions.

The biggest risk is misclassifying an employee as a contractor. If a court determines that a worker is an employee, you could be liable for back pay, benefits, and other penalties.

An Employer of Record (EOR) helps you avoid this risk. We handle the legal classification of your workers, ensuring you comply with Hong Kong's laws. An EOR takes on the responsibility of payroll, benefits, and compliance, allowing you to focus on managing your team and growing your business.

Navigating compensation and payroll in Hong Kong is straightforward. The city's tax system is a major draw for international businesses. You'll find that Hong Kong taxes only income earned within its territory. This, combined with a simple tax structure, makes payroll management relatively easy. Still, you need to follow the rules to avoid penalties.

Payroll cycles & wage structure

In Hong Kong, the payroll cycle is typically monthly. You should pay your employees on the last day of the month. If you can't make the payment on the agreed date, you have a grace period of seven days. After that, you'll have to pay interest on the outstanding wages.

An employee's salary has a few key components:

• Basic salary: This is the fixed part of an employee's pay.
• Allowances: You might offer additional payments for things like housing or travel.
• Benefits: These can include things like health insurance or other perks.

Overtime & minimums

Hong Kong's labor laws don't require you to pay extra for overtime. Any overtime arrangements, including pay rates, should be clearly stated in the employment contract. If your contract includes overtime pay, you are legally required to pay it.

The statutory minimum wage in Hong Kong is currently HKD 40 per hour.

Employer taxes and contributions

Your main responsibility as an employer is to contribute to the Mandatory Provident Fund (MPF). This is a retirement savings plan for your employees. You are not responsible for withholding income tax from your employees' wages.

Employee taxes and deductions

Your employees are also required to contribute to the MPF. They are responsible for filing their own annual tax returns with the Inland Revenue Department (IRD).

In Hong Kong, benefits and leave are a mix of government-mandated requirements and extra perks offered by employers. The Employment Ordinance sets the minimum standards that all employers must follow. This ensures you get essential benefits like paid time off and contributions to a retirement fund. Many companies, however, offer more than the basics to attract and keep talented people. This means you might find benefits like private health insurance or extra paid leave.

Statutory leave

The Hong Kong government requires employers to provide several types of leave. These are the legal minimums.

• Annual Leave: You are entitled to paid annual leave after working for the same employer for 12 months. You start with seven days, and this increases by one day for each year you work, up to a maximum of 14 days.
• Sick Leave: You can accumulate paid sick days. In your first year, you get two paid sick days for each month you work. After the first year, this increases to four days per month. You can accumulate a maximum of 120 sick days. Your sick leave pay is 80% of your average daily wage.
• Maternity Leave: A pregnant employee is entitled to 14 weeks of maternity leave. To be eligible, you must have worked for your employer for at least 40 weeks before the leave starts. The pay is four-fifths of your regular salary.
• Paternity Leave: Fathers are entitled to five days of paternity leave.
• Rest Days: You are entitled to at least one rest day every seven days.

Public holidays & regional holidays

In 2025, you are entitled to the following public holidays in Hong Kong:

Typical supplemental benefits

Many employers in Hong Kong offer benefits beyond the legal requirements. Here’s a look at both statutory and non-statutory benefits.

How an EOR can help with setting up benefits

An Employer of Record (EOR) can make setting up and managing employee benefits in Hong Kong much simpler.

An EOR acts as the legal employer for your employees. This means they handle all the administrative tasks related to employment.

Here’s how an EOR can help:

• Compliance: An EOR ensures that your benefits packages comply with all of Hong Kong's employment laws. This reduces the risk of legal issues.
• Payroll and Tax: They manage payroll processing, including tax deductions and contributions to the Mandatory Provident Fund (MPF).
• Administration: An EOR handles the day-to-day administration of benefits, saving you time and resources.
• Onboarding: They can help with the onboarding process, including drafting employment contracts that are compliant with local laws.

Using an EOR allows you to focus on your core business activities while they handle the complexities of HR and benefits administration.

Letting an employee go is a reality of business, and in Hong Kong, this process has clear rules. Both you and your employee have rights and obligations. Understanding them is key to a smooth and compliant offboarding experience. This guide breaks down what you need to know about notice periods and severance pay.

Notice Periods

When ending an employment contract, you usually need to provide notice or a payment in lieu of notice. The length of the notice period depends on what's in the employment contract and the employee's length of service.

Here’s a simple breakdown:

• First month of probation: No notice period is required by either party.
• After the first month of probation: A minimum of seven days' notice is required. If your contract specifies a longer period, that's the one you follow.
• No probation period or after probation is complete: If the contract specifies a notice period, it must be at least seven days. If the contract doesn't mention a notice period, the required notice is at least one month.

You can terminate an employee without notice under specific circumstances, such as serious misconduct or willful disobedience of a lawful order.

Severance Pay

Severance pay is a payment made to an employee who is dismissed due to redundancy. An employee is eligible for severance pay if they have worked for you under a continuous contract for at least 24 months.

The calculation for severance pay is as follows:

(2/3 x last full month's wages) x years of service*

*Capped at HK$22,500

The total severance payment is capped at HK$390,000.

For example, an employee earning HK$18,000 per month with 4 years of service would be calculated as:

(2/3 x HK$18,000) x 4 = HK$48,000

It's important to note that an employee cannot receive both severance pay and long service payment.

How Rivermate Handles Compliant Exits

When you partner with Rivermate, you don't have to navigate these complexities alone. We ensure every termination and offboarding process in Hong Kong is handled correctly and compassionately.

Here’s how we help:

• Contract Review: We start by reviewing the employment agreement to determine the correct notice period and any contractual obligations.
• Clear Calculations: We calculate all final payments, including outstanding wages, payment in lieu of notice, unused annual leave, and any applicable severance pay. We make sure these payments are made within seven days of termination.
• Compliance Check: Our team ensures every step of the process adheres to Hong Kong's Employment Ordinance, minimizing your legal risk.
• Documentation: We handle the necessary paperwork, including notifying the Inland Revenue Department (IRD) of the employee's departure.
• Guidance and Support: We provide you with clear guidance throughout the process, so you understand your obligations and can handle the situation with confidence.

With Rivermate, you can be sure that your offboarding process is not only compliant but also respectful to your departing employee.

Navigating Hong Kong's visa and work permit landscape can feel complex. The key is understanding that anyone without the right of abode, essentially permanent residency, must have a specific visa to work. This process is managed by the Hong Kong Immigration Department and generally requires an employer to sponsor the individual. Simply entering on a visitor visa does not grant you the right to work, paid or unpaid.

Employment visas & sponsorship realities

When you partner with an Employer of Record (EOR), we handle the complexities of visa sponsorship for your team members in Hong Kong. An EOR acts as the legal employer and can sponsor applications for employment visas. This simplifies the process for you, as we manage the necessary paperwork and ensure compliance with local immigration laws.

However, it's important to be realistic. The most common route is the General Employment Policy (GEP), which requires demonstrating that the candidate has special skills, knowledge, or experience not readily available in Hong Kong. While an EOR can sponsor a GEP visa, the ultimate decision rests with the Hong Kong Immigration Department.

Here are the practical routes for employment:

• General Employment Policy (GEP): This is the standard work visa for foreign professionals. We can sponsor candidates who have a confirmed job offer and meet the specific skill requirements.
• Top Talent Pass Scheme (TTPS): This scheme is for high-income individuals or graduates from top universities. Applicants do not need a job offer to apply, making it a more direct route for highly qualified professionals.
• Immigration Arrangements for Non-local Graduates (IANG): This visa is for individuals who have graduated from a Hong Kong university. It allows them to stay and work without a job offer initially.

An EOR cannot guarantee visa approval. Success depends on the individual's qualifications and the role itself. We will guide you through the process and help you present the strongest possible case to the immigration authorities.

Business travel compliance

For short-term business trips, many nationalities can enter Hong Kong without a visa for a set period. Citizens of over 150 countries can take advantage of visa-free travel for stays ranging from 7 to 180 days.

If you are visiting for business, you can engage in specific activities:

• Attending business meetings or seminars
• Concluding contracts or submitting tenders
• Participating in trade fairs (with some restrictions)

It is crucial to understand the limitations. As a business visitor, you cannot:

• Take up any employment, paid or unpaid.
• Establish or join a business.
• Enroll in any educational institution.

Always check the latest requirements for your specific nationality before you travel. For frequent visitors, Hong Kong offers options like the Travel Pass or APEC Business Travel Card to streamline entry.