In today’s world, we are constantly connected to one another. With businesses becoming more international, geographical boundaries are playing less of a role. In fact, many businesses are looking outside of their country to hires marketers and developers in order get qualified employees while also cutting expenses. Although selecting workers from other countries can seem appealing, one must be cautious of false promises and inflated skill sets. When you’ve got an international staff, you have to make sure everything is on the level.
How can you manage and hire employees who work remotely overseas, in Hong Kong? Are you obligated to pay taxes, and does MPF apply? Keep reading to find answers to these questions in this article!
What you’ll learn:
Considerations after hiring overseas employees in Hong Kong
The government of Hong Kong requires that employers give priority to local talent. Therefore, foreign applicants come in secibd. However, people from other countries who have skills, experience, and knowledge that is not readily available in Hong Kong are allowed to get a job. Unless you have a valid work visa, it is illegal to both work and live in Hong Kong as a foreigner. Employers are responsible for applying work visa and once it gets approved, the employee may start their new job.
The following tips will help make your process smoother:
- Laws in the region that bind employers and employees
- Legal boundaries and guidelines for hiring local and foreign workers in Hong Kong (with the priority rule)
- Common practices and procedures during the hiring process
- Specific guidelines for recruiting in Hong Kong
There are two main categories of employees:
- Skilled professionals, such as software engineers, R&D specialists, and doctors may be issued an Employment Visa
- Semi-skilled professionals, such as technicians, may be issued the Supplementary Labor Scheme visas
2. Provide benefits
According to the Employment Ordinance, which is Hong Kong’s primary legislation, as an employer you must provide:
- Paid annual leave
- Paid sick leave
- Paid maternity and paternity leave
- A minimum notice of termination and the right to make a payment
There are other legal requirements for individuals working in Hong Kong. The following ordinances apply no matter what the contract says about which law applies:
Procedures in Hong Kong are very straightforward, with little bureaucracy, and high English proficiency. Despite all of that, it would be a good idea to give your future employees some advice about moving to Hong Kong.
- No tariffs or duties on items you personally use or households goods.
- No limit to the amount of cash they are bringing
- Difficult to secure a living place due to dense population
- Accessible and Affordable healthcare system
- Simple and easy procedures of bank account opening for non-residents
- Low tax rates with plenty of allowances and deductions
The foundation of MPF (the Mandatory Provident Fund) is based on those who are employed in or from Hong Kong. An employee not currently residing in Hong Kong may still be covered under MPF if there is sufficient evidence connecting the individual back to the region.
If an employee from Hong Kong is working for a company outside of the region only for a short period of time, they are still generally viewed as being connected to Hong Kong. Therefore, the employer has to enroll the employee in an MPF scheme and make regular MPF contributions on their behalf.
The external employment service in Hong Kong is highly regulated. If you’re considering working overseas, it’s important to be aware of the laws and conditions that need to be met. The Employment Agencies Administration provides services for those seeking employment and administers the Contracts for Employment Outside Hong Kong Ordinance. This ordinance sets the standards for employment conditions of local employees working overseas for Hong Kong employers.
How can FastLane help?
The immigration department in Hong Kong has many requirements that can make it difficult to recruit foreign skilled professionals. Streamline your time by allowing the experts at FastLane process your employment visa application for you while you focus on other tasks.
FastLane offers comprehensive suite of corporate services, including accounting, audit, payroll, company secretary and work visa application. Our payroll services specialises in improving HR processes using cloud-based solutions, expert assistance, and appropriate payroll programs. Let us manage essential business tasks, like payroll and MPF account setup, as well as your employee’s enrollment into the chosen MPF scheme.
If you have any other questions, please don’t hesitate to reach out to us. We would be more than happy to help guide you through this process!