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Severance payment + MPF offset

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  1. #1

    Join Date
    Jun 2008
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    Severance payment + MPF offset

    Here's a quick question regarding severance payment law in HK.

    Looking at the quoted text off HK Labour Dept site, see below, I just want to make sure I understand this correctly. Is the maximum payment 15k x years of service?

    "Monthly-paid employee
    (last month wages* X 2/3)# × reckonable years of service

    Service of an incomplete year should be calculated on a pro rata basis.
    Click here for information on the reckonable years of service (PDF).

    * An employee may also elect to use his average wages in the 12 months immediately preceding the termination of employment contract for the calculation. (Where the employee's employment contract is terminated by payment in lieu of notice, the employee may elect to use his average wages in the 12 months immediately preceding the date up to which the payment in lieu of notice is calculated.)
    # The sum should not exceed 2/3 of $22,500 (i.e. $15,000)."


    Link to site: https://www.labour.gov.hk/eng/faq/cap57l_whole.htm#q1


  2. #2

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    Not reviewed this in a while but it seems accurate + consider MPF offset nonsense.


  3. #3

    Join Date
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    Not exactly.

    The minimum is 15k per year of service (if you earn over 22k per month, otherwise its less....) , your employer can choose to pay more if they want - Good luck with that!

    But that's not the worst bit. The worst bit is that your employer can reclaim that 15k per year from the mandatory contributions they made to your MPF - That MPF money you thought was yours? Well the employer's gonna take 15k/yr of it back (out of the 18k per year they would have paid in in the last few years - less before that) and pay it to you as your redundancy.

    Welcome to HK's fuck-over-employees-scheme.


  4. #4

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    Is the maximum payment 15k x years of service?
    Yes that is correct, if you worked for a company for example for 30 years and they kick you out, you will get

    15K x 30 years = HK$ 450 000, this amount they can take it back from their contribution to your MPF, they cannot touch your own contribution to MPF.
    angeluscomplex likes this.

  5. #5

    Join Date
    Jun 2008
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    Thanks for the clarification.


  6. #6

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    Quote Originally Posted by chuckster007:
    Yes that is correct, if you worked for a company for example for 30 years and they kick you out, you will get

    15K x 30 years = HK$ 450 000, this amount they can take it back from their contribution to your MPF, they cannot touch your own contribution to MPF.
    To be fair - not all employers are like this. Some (a few) value those who helped their businesses grow.
    chuckster007 likes this.

  7. #7

    Join Date
    Jun 2008
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    Yes, I wish my employer was like that.


  8. #8

    Join Date
    May 2019
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    I am confuse about the MPF. Let say I worked for 3 years and I got the redundancy. Does that mean that the company can take back 15k x 3years (HKD45K) out from my MPF account???


  9. #9

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  10. #10

    Join Date
    May 2019
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    Wow! No wonder they say that HK is really pro-employer. One more topic that I need to talk to my HR then.


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