Wage subsidy and employment relief announced in second round of Anti-epidemic fund

UPDATE 5: 12 June 2020 – Hong Kong Wage Subsidy Update 5 – Reminder: Deadline to apply for 1st tranche of Employment Support Scheme (ESS) closes on Sunday, 14 June 2020 at 23:59 HKT

UPDATE 4: 19 May 2020 – Hong Kong Wage Subsidy Update 4 –Employment Support Scheme (ESS) Application details announced

UPDATE 3: 15 May 2020 – Hong Kong Wage Subsidy Update 3 – HK Government releases further details on application process for Employment Support Scheme (ESS)

UPDATE 2: 20 April 2020 – Hong Kong Wage Subsidy Update – Further details on Employment Support Scheme (ESS) provided in Finance Committee Discussion Paper

The Hong Kong government announced on 8 April 2020 the second round of $137.5 billion Anti-epidemic fund measures, which include the implementation of an Employment Support Scheme. The support consists of a wage subsidy for six months for eligible employers to help retain employees, in exchange for which requires the employers not to implement redundancy. The wage subsidy is up to HK$9,000 calculated based on 50% of the monthly salary, which is capped at $18,000, for a period of six months.

Details of the full announcement are at: https://www.coronavirus.gov.hk/eng/anti-epidemic-fund-2.html. The application process has not yet been notified. 

As the measures include several other features applicable to specific industry sectors, employers may wish to review the full announcement in case any other aspects may be of assistance for their organisation.

Some of the key details of the Employment Support Scheme provided in the announcement are: 

(1) Implementing the Employment Support Scheme ($80 billion): 

• The Government will provide wage subsidy to eligible employers to retain the latter’s employees. Employers have to undertake that they cannot implement redundancy. 
   
• All employers who have been making Mandatory Provident Fund (MPF) contributions for employees are eligible, except those on the exclusion list (employees of the HKSARG, statutory bodies and Government subvented organisations) 
   
• The wage subsidy to be provided by the Government is calculated based on 50% of the monthly salary, which is capped at $18,000 (i.e. the median monthly wage in Q2 2019), for a period of six months.
   
• To be disbursed to employers in two payments, with the first not later than June 2020. Expect to benefit 1.5 million employees.
   
• To provide support to employers in the catering, construction and transport (mainly taxi and red minibus drivers) sectors which are not completely covered by the MPF scheme (involving about 800 000 persons) 
   
• To grant a one-off subsidy to self-employed persons who made MPF contributions (about 215 000 persons)

To contact the Tanner De Witt Employment Practice, please reach out to Kim or Russell at:

Disclaimer: This publication is general in nature and is not intended to constitute legal advice. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.