By Globalization PartnersSeptember 2014
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Check out our top market-norm benefits tips for securing the best talent in a tight labor market.
Mainland China’s economy continues to bustle, and Hong Kong is often favored as a great launchpad into the Mainland and the surrounding territories. A common favorite residence for a seasoned VP of APAC Sales, Hong Kong is one of the top countries our clients request our services.
Hong Kong labor law is well-defined and clear cut, which makes it relatively easy to negotiate with offer letter terms with employees in Hong Kong. Here’s our top market-norm benefits tips for securing the best talent in a tight labor market.
- Vacation: Most employers provide at least 14 vacation days to white-collar professionals, and senior executives may command more (3-4 weeks). Statutory minimum is 7 days plus 1 day for each additional year worked with a company.
- A 13th month salary or annual bonus is not required but is often granted to employees in Hong Kong. A commission plan may be seen as replacing this for a sales employee. An annual bonus or commission may be equal to 2-3 months’ salary when the economy is strong.
- Health and life insurance are often provided to employees as a supplementary benefit. Most executives request supplementary health and life insurance; smaller companies may provide an allowance in lieu of arranging insurance. Globalization Partners can arrange health insurance for employees in Hong Kong as part of our Global Employee Leasing Platform.
- The required notice to terminate employment varies with the length of contract; 1 month’s termination notice on behalf of the employer or employee is the generally agreed term and may be used as a guideline after the probation period.
- Pension Fund: The Mandatory Provident Fund (MPF) is a compulsory saving scheme which is required to prepare the residents of Hong Kong for retirement. At minimum, we suggest budgeting 5% on top of salary for the employer’s portion of the MPF fund in Hong Kong.
- Generally, we recommend budgeting 15% as benefits cost on top of the gross salary to allocate the total employer’s cost including benefits in Hong Kong, including the MPF allocation.