Launch of Greater Bay Area Youth Employment Scheme
Rest day issues
Statutory minimum wage
Employment (Amendment) Bill 2021 gazetted
Amendment to Sex Discrimination Ordinance
Reimbursement of Maternity Leave Pay Scheme
Hong Kong Court grants injunction to enforce non-compete restriction

2022 outlook


2021 has been a difficult year for both employers and employees. As the covid-19 pandemic continues, maintaining a good employment relationship can be challenging and many businesses have been forced to change the way they operate.

Whilst the pandemic has been the dominant theme of 2021, there have been a number of other developments in Hong Kong employment law during the year.

This article outlines the most important employment-related developments of 2021 as well as providing comment on the outlook for the Hong Kong employment landscape in 2022.

Launch of Greater Bay Area Youth Employment Scheme

In January 2021, the Hong Kong government launched the Greater Bay Area Youth Employment Scheme (the Scheme). The Scheme aims to encourage enterprises with operations in the Greater Bay Area to recruit Hong Kong university graduates to up to 2,000 posts, with around 700 places designated for innovation and technology posts.

The Scheme entails a cross-border employment arrangement under a Hong Kong contract. Employers in Hong Kong who are contemplating participating in the Scheme should consider whether they need advice on issues such as dual employment contracts, relevant employment benefits, applicable People's Republic of China (PRC) employment laws and tax implications.

Rest day issues

Employees' statutory entitlement to rest days was considered in the case of Breton Jean v HK Bellawings Jet Limited.(1) The plaintiff was employed as a commercial pilot, with no fixed working days. He was required to be accessible on his work phone at all times except when he was on annual leave. The court held that, regardless of whether the employee was actually called upon to perform flying duties on such standby days, the fact that the employee was not entitled to abstain from work completely rendered that day not a proper rest day.

Employers are reminded that it is an offence in Hong Kong to fail to grant their employees at least one rest day every seven days. As this case makes clear, a proper statutory rest day involves the employee abstaining from any work for not less than 24 hours. Requiring employees to be on standby risks putting the employer in breach.

Statutory minimum wage

Following a report by the Minimum Wage Commission, the statutory minimum wage in Hong Kong will remain at 37.50 Hong Kong dollars per hour until 30 April 2023. This is the first time the Commission has not recommended a raise of the statutory minimum wage since its inception in 2011. In light of the economic uncertainty brought about by the pandemic, the Commission recommended that the prevailing minimum wage be frozen. In arriving at this decision, it took into account the potential impact on low-earning employees as well as operational costs of businesses.

Employers are reminded of their legal obligation to ensure that their employees are not paid less than the statutory minimum wage. Any failure to do so would attract not only civil liability (to the employer), but may also give rise to criminal liability.

Employment (Amendment) Bill 2021 gazetted

Hong Kong's Employment (Amendment) Bill 2021 (the Bill) was gazetted on 5 March 2021 to increase the number of statutory holidays under the Employment Ordinance from 12 days to 17 days progressively from 2022 to 2030. Under the Bill, the five additional statutory holidays will roll out in the following manner:

  • Buddha's Birthday, being the eighth day of the fourth lunar month (starting from 1 January 2022);
  • the first weekday after Christmas Day (starting from 1 January 2024);
  • Easter Monday (starting from 1 January 2026);
  • Good Friday (starting from 1 January 2028); and
  • the day following Good Friday (starting from 1 January 2030).

Employers should bear in mind that the additional statutory holiday for Buddha's Birthday has come into effect.

Amendment to Sex Discrimination Ordinance

The Sex Discrimination (Amendment) Bill was passed by the Legislative Council on 17 March 2021. As a result of this amendment, it will be unlawful for a person to harass a breastfeeding woman. This protection will complement the protection against discrimination against breastfeeding which was introduced by the Discrimination Legislation (Miscellaneous amendments) Ordinance 2020.

In this regard, employers are reminded to provide and uphold a safe and discrimination-free working environment, and to be particularly conscious of these new protections for women feeding their babies.

Reimbursement of Maternity Leave Pay Scheme

The statutory maternity leave under the Employment Ordinance was extended from 10 weeks to 14 weeks from December 2020. To alleviate some of the increased financial pressure faced by employers, employers can now apply to the Reimbursement of Maternity Leave Pay Scheme for reimbursement for maternity leave pay during the additional four weeks, subject to a cap of 80,000 Hong Kong dollars per employee.

Hong Kong court grants injunction to enforce non-compete restriction

In a recent decision in BFAM Partners (Hong Kong) Limited v Gareth John Mills and Segantii Capital Management Limited,(2) the court upheld and enforced a six-month non-compete restriction by granting an injunction in favour of the plaintiff against a former employee from working for a competitor.

The Hong Kong courts have sometimes been reluctant to enforce post-termination non-compete clauses. These restrictions are regarded as a restraint on the free flow of labour and a barrier to productivity. The courts are mindful of the draconian effect that non-compete restrictions can have on employees.

This case, however, demonstrates that there are circumstances in which the courts are inclined to enforce a non-compete clause. Examples of these are as follows:

  • The employer in this case submitted detailed evidence which pinpointed the confidential information it was seeking to protect. Employers often fail to identify information which is genuinely confidential and which should be protected from disclosure or misuse.
  • The employer was able to justify the period of restriction that it had imposed.
  • The employer was willing to compensate the employee for the protection afforded to the employer by the non-compete term, which persuaded the court that the non-compete term was reasonable and that the employee was not prejudiced as a result.

Employers are reminded that any restrictive covenants should be tailored specifically to the circumstances of the employment. Factors such as the nature of the employment, the seniority of the employee and the kind of information that the employee may have access to and the likelihood that such information may be transferred should be taken into consideration when formulating these provisions.

2022 outlook

Amendments to Employment Ordinance
As covid-19 continues to bedevil the city, it was announced on 8 February 2022 that the Employment Ordinance would be amended to reflect some of the pandemic measures imposed by the Hong Kong government, and to avoid any dispute or ambiguity when imposing such measures in an employment setting.

Specific details of the proposed amendments are yet to be announced; however, the following should be expected:

  • If an employee unreasonably refuses to take vaccinations and that results in their inability to attend work and they are dismissed on this ground, this would not be regarded as unreasonable dismissal.
  • If an employer dismisses an employee because they are unable to attend work as a result of a compulsory quarantine order, this would constitute unreasonable dismissal.
  • Any quarantine order or medical certificate issued by the Department of Health can serve as a valid medical certificate, entitling any eligible employee to receive statutory sickness allowance. Accordingly, the employer should grant the employee statutory sickness allowance if the employee who has been employed under a continuous contract:
    • is not able to attend work for four consecutive days or more due to a compulsory quarantine order;
    • submits the quarantine order or a medical certificate to the employer; and
    • has accumulated a sufficient number of paid sickness days.

The Chief Executive has indicated that the first draft of the amendments is currently underway. Although an exact timetable is yet to be announced, these amendments are expected to come into effect very soon.

Proposal to abolish MPF offsetting mechanism
With the announcement of the progressive abolition of the Mandatory Provident Fund (MPF) offsetting mechanism in the Chief Executive's 2021 Policy Address, by 2025 employers will no longer be able to offset their MPF contributions against any severance payment due to departing employees.

A compensation arrangement for employers to ease the transition is currently under discussion. Any such arrangement is expected to run for 25 years. It is expected that the relevant bills will be passed in 2022.

Increasing amount of ex gratia payment covered by Protection of Wages on Insolvency Fund
The implementation of the MPF offsetting mechanism will inevitably mean that employers will bear higher costs when terminating their employee's employment. In the event that an employer becomes insolvent and fails to pay its employees any statutory entitlements, employees may apply for an ex gratia payment from the Protection of Wages on Insolvency Fund (the Fund) in respect of wages in arrears, pay for untaken annual leave, pay for untaken statutory holidays, wages in lieu of notice or severance payment owed by their employer. In light of the abolition of the MPF offsetting mechanism, the Labour Department is set to increase the size of the Fund to cushion against the potential increase in claiming amounts by employees.

It is expected that the government will implement the increase within 2022's legislative year; however, the exact timetable is still yet to be announced. Sources say that the increase may be as much as 100%.

Increase in penalties for occupational safety and health-related offences
In the Chief Executive's Policy Address 2021, it was announced that there are plans to amend the relevant legislation in relation to occupational safety and health-related offences, which has been largely stagnant for 20 years.

The two key pieces of legislation, namely the Occupational Safety and Health Ordinance and the Factories and Industrial Undertakings Ordinance, currently carry a maximum fine of 500,000 Hong Kong dollars and a period of imprisonment of 12 months. Preliminary proposals after consultation with the Labour Department suggest an increase to a maximum fine of 6 million Hong Kong dollars or 10% of the convicted entity's turnover, capped at 50 million Hong Kong dollars (whichever is greater), and a maximum imprisonment term of three years.

The relevant bills are expected to be implemented by the end of 2022.

For further information on this topic please contact Patricia Yeung at Howse Williams by telephone (+852 2803 3688) or email ([email protected]). The Howse Williams website can be accessed at


(1) [2021] HKDC 46.

(2) [2021] HKCFI 2904.