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UPDATED JUL 6, 2026💡 Everything you need to know to hire and manage employees in Hong Kong through Toku. Toku handles payroll processing, tax withholding, social contributions, and statutory compliance. This guide covers what you need to plan costs and manage your team.
At a Glance
| Item | Detail |
|---|---|
| Currency | Hong Kong Dollar (HKD) |
| Payroll cycle | Monthly. Toku runs one payroll per month in Hong Kong. |
| Onboarding lead time | 5-7 business days |
| Standard working week | No statutory standard; typically 40-48 hours by contract |
| Probation period | 3 months (per Toku's employment agreement) |
| Annual leave | 7 days after 1 year, rising to 14 days with service |
| 13th month salary | Not required (discretionary year-end bonuses are common) |
| Minimum notice on termination | 7 days minimum; 1 month if the contract does not specify |
| Fiscal year | 1 April to 31 March |
Onboarding a New Hire
Plan for 5-7 business days between submitting a new hire and their start date. The employment contract is signed before day one, and your new hire just needs to provide their HKID or a valid work visa. Toku enrolls the employee in a Mandatory Provident Fund (MPF) scheme within the statutory 60-day window.
Submit your new hire through the Toku platform and we take it from there: local employment agreement, statutory registrations, and payroll setup. See Onboard Contributors as a Client Admin in Toku for the step-by-step process, and the Country Readiness Live Tracker for lead times across all countries.
Employer Costs
Hong Kong has one of the lowest employer cost burdens of any major market. On top of each employee's gross salary, you pay:
| Cost | Rate | Notes |
|---|---|---|
| Mandatory Provident Fund (MPF) | 5% of relevant income | Capped at HKD 1,500 per month (income cap of HKD 30,000/month) |
Employers must also carry employees' compensation (work injury) insurance, which Toku arranges. As a rule of thumb, total cost of employment is roughly 105% of gross salary, and even less in percentage terms for higher earners because of the MPF cap. There is no required 13th month salary, though discretionary year-end bonuses are common practice.
Employees contribute their own 5% to MPF (also capped at HKD 1,500 per month), deducted from gross salary rather than added to your costs. Salaries tax is low (progressive rates from 2% to 17%, or a 15% standard rate) and is assessed annually by the Inland Revenue Department rather than withheld each month; Toku handles the MPF remittances and all employer tax filings.
Compensation & Payroll
Toku runs one payroll per month in Hong Kong, and employees receive a payslip each cycle. The statutory minimum wage is HKD 43.1 per hour from 1 May 2026. There is no mandatory 13th month payment or statutory bonus.
Employment Contracts & Probation
- Toku issues a compliant local employment agreement for every hire, with written terms provided as the Employment Ordinance requires.
- Contracts can be indefinite or fixed-term; fixed-term contracts that renew or continue are treated as continuous employment.
- Probation is 3 months under Toku's employment agreement. During the first month of probation, either party may end employment without notice; after that, at least 7 days' notice applies.
Working Hours
Hong Kong has no statutory standard working hours or overtime pay requirements for most employees; hours are set by the employment contract, typically 40-48 per week. Any overtime arrangements are contractual, so agree them clearly up front. Employees are entitled to at least one rest day per week.
Leave Entitlements
| Leave | Entitlement | Who pays |
|---|---|---|
| Annual leave | 7 days after 1 year of service, rising by 1 day per year to 14 days at 9+ years, at full pay | Employer |
| Statutory holidays | 15 paid days (after 3 months of employment) | Employer |
| Sick leave | Accrues at 2 days/month in the first year, then 4 days/month, up to 120 days; paid at 4/5 of average daily wages | Employer |
| Maternity leave | 14 weeks at 4/5 of average daily wages (after 40 weeks of employment) | Employer (government reimburses weeks 11-14) |
| Paternity leave | 5 days at 4/5 of average daily wages (after 40 weeks of employment) | Employer |
| Rest days | 1 day per 7-day period | Unpaid unless the contract says otherwise |
Sick leave beyond four consecutive days requires a medical certificate. Employees are protected from dismissal from the date they give notice of pregnancy until the end of maternity leave.
Public Holidays (2026)
Hong Kong observes 17 general holidays in 2026, of which 15 are statutory paid holidays under the Employment Ordinance (Easter Monday joins the statutory list from 2026). When a statutory holiday falls on a Sunday, the next weekday is observed instead.
| Date | Holiday |
|---|---|
| 1 January | New Year's Day |
| 17 February | Lunar New Year's Day |
| 18 February | Second Day of Lunar New Year |
| 19 February | Third Day of Lunar New Year |
| 3 April | Good Friday |
| 4 April | Day Following Good Friday |
| 6 April | Day Following Ching Ming Festival (also Easter Monday) |
| 7 April | Day Following Easter Monday |
| 1 May | Labour Day |
| 25 May | Birthday of the Buddha (substitute) |
| 19 June | Tuen Ng (Dragon Boat) Festival |
| 1 July | HKSAR Establishment Day |
| 26 September | Day Following the Chinese Mid-Autumn Festival |
| 1 October | National Day |
| 19 October | Chung Yeung Festival (substitute) |
| 25 December | Christmas Day |
| 26 December | First Weekday After Christmas |
Benefits: Required vs. Common Extras
Statutory (included in employer costs above): the MPF retirement scheme and employees' compensation (work injury) insurance. Hong Kong does not require employer-provided medical insurance.
Toku offers fully sponsored international health coverage through Remote Health. See Remote Health, Your Global Insurance Plan for coverage details and enrollment.
Common extras in the Hong Kong market include medical and dental insurance, life and disability cover, housing and transportation allowances, education allowances for dependents, and voluntary top-up MPF contributions. Toku can advise on the cost impact of any extras you want to offer.
Ending Employment
Hong Kong is comparatively flexible: either party can terminate with notice or payment in lieu, and no reason is required for termination with notice, though protected situations (pregnancy, paid sick leave, work injury) still apply, so loop in Toku before acting. For the process, see How to Terminate an Employee or Contractor.
| Service | Notice |
|---|---|
| First month of probation | None required |
| Rest of probation | 7 days minimum |
| After probation | As per contract, minimum 7 days; 1 month if not specified |
Severance applies after 24 months of continuous service where the dismissal is for redundancy: two thirds of the last month's wages (capped at HKD 15,000) per year of service, up to a maximum of HKD 390,000. A long service payment on the same formula applies after 5 years of service for most non-redundancy terminations. An employee receives one or the other, never both.
Hiring Someone from Overseas?
Hong Kong permanent residents and HKID holders with work rights need no sponsorship. Other candidates need an employment visa, most commonly under the General Employment Policy, which requires showing the role cannot be filled locally; specialist schemes exist for mainland Chinese talent, technology roles, and top-tier graduates and earners. Processing typically takes 4 to 8 weeks. Talk to Toku before extending an offer to a candidate who needs sponsorship.
Last verified July 2026. This guide is for general information and doesn't constitute legal or tax advice. Your Toku account manager can confirm specifics for your situation.