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How to hire remote employees in
Laws about hiring are complicated, and the same is true in Hong Kong. But there are ways to sidestep the headaches—if your company hasn’t already established a physical presence in Hong Kong, you have two real options when it comes to hiring. We’ll detail both below.
If you want to successfully hire in
Hong Kong
, you have two options:
Laws about hiring contractors are significantly more simple in
Hong Kong
. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Thera for.
This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in
Hong Kong
is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.
Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in
Hong Kong
.
Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.
It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.
Hiring contractors in
Hong Kong
means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.
Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.
The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.
Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.
If you’re hiring contractors in
Hong Kong
, you can pay them with Thera in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.
If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Hong Kong than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Hong Kong.
An employee is entitled to annual leave with pay after having been employed under a continuous contract for every 12 months. Annual leave entitlement increases progressively from 7 days to a maximum of 14 days according to years of service:
All employees are entitled to statutory holidays. Most employers however extend entitlement to all general holidays. There are 12 statutory holidays and 5 general holidays.
Length
14 weeks and can begin at any time between two and four weeks before the expected date of birth of the child.
Payment by employer
The employee is eligible for maternity leave pay if she has been employed under a continuous contract for not less than 40 weeks immediately before the commencement of scheduled maternity leave.
The daily rate of maternity leave pay is a sum equivalent to 4/5 (80%) of the average daily wages earned by an employee in the 12-month period preceding the first day of maternity leave.
Length
Male employees are entitled to 5 days’ paternity leave.
Payment by employer
The employee is eligible for paternity leave pay if he has been employed under a continuous contract for not less than 40 weeks immediately before the day of paternity leave.
Payment by employer
The daily rate of paternity leave pay is a sum equivalent to 4/5 (80%) of the average daily wages earned by an employee in the 12-month period preceding the day of paternity leave.
No statutory laws or regulations.
None.
None.
None.
A contract of employment may be terminated by the employer or employee by giving the other party due notice or payment in lieu of notice.
Statutory restrictions on termination
An employer shall not dismiss an employee under the following circumstances:
An employee may claim for remedies against an employer under the following situations:
During Probation Period
1. Within first month: not required
2. After the first month where a contract makes provision for the required length of notice: as per the agreement
3. After the first month where the contract doesn’t make provision: not less than 7 days notice
For continuous contract / After probation period
1.Where contract makes provision: as per the agreement, no less than 7 days.
2.Where the contract doesn’t make provision: not less than 1 month.
An employee is eligible for severance payment or long service payment subject to the following conditions:
Severance Payment
Qualifying Period:
not less than 24 months under a continuous payment
Requirements:
a.) employee is dismissed by reason of redundancy
b) contract expires without being renewed by reason of redundancy
c) The employee is laid off
Long Service Payment
Qualifying Period:
not less than 5 years under a continuous contract
Requirements:
a) employee is dismissed but not due to serious misconduct
b) dismissal is not due to the reason of redundancy
c) employment contract expired without being renewed
d) employee dies
e) employee reigns on ill-health
f) employee resigns on grounds of old age
An employee will not be simultaneously entitled to both long service payment and severance payment.
Amount of payment
(last month wages* x 2/3)# x reckonable years of services
* An employee may also elect to use his average wages in the 12 months immediately preceding the termination of the employment contract
# The sum should not exceed 2/3 of HK$ 22,500 (i.e. HK$ 15,000)
Maximum Amount
The maximum amount of severance payment or long service payment is HK$ 390,000.
None.
There are generally no restrictions on working hours, except in relation to young persons (under 18 years of age) for whom the maximum working period is usually eight hours per day or 48 hours per week.
Rest Day: An employee employed under a continuous contract is entitled to no less than one rest day in every period of seven days. Whether rest day is paid or not is to be agreed by employers and employees. In general, the rest day is paid in Hong Kong.
There are no special restrictions applicable to the working hours or rest breaks for shift workers.
All employees covered by the Employment Ordinance, irrespective of their hours of work, are entitled to basic protections under the Ordinance. Employees who are employed under a continuous contract by the same employer for four weeks or more, with at least 18 hours worked in each week are further entitled to additional benefits.
Optional (as long as minimum wages are respected overall).
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