Hong Kong Statutory and Private Employee Benefits, 2023 Update

Hong Kong Statutory and Private Employee Benefits Report Overview

According to the March 2022 report from the Social Welfare Department of Hong Kong Statistics, the number of participants under the CSSA scheme was 302,599. The social welfare system in Hong Kong  insurance provides cover to all residents in the event of disability, old age, death, unemployment, and sickness. The public pension pillar covers individuals in need of assistance. The occupational pillar, which is a compulsory defined contribution (DC) scheme, was launched in 2000, and the third pillar is a voluntary pension savings scheme.

The Social Welfare Department (SWD) administers Hong Kong’s non-contributory social security system, which includes the Comprehensive Social Security Assistance (CSSA) scheme, the Social Security Allowance (SSA) scheme, the Criminal and Law Enforcement Injuries Compensation (CLEIC) scheme, the Traffic Accident Victims Assistance (TAVA) scheme, the Support for Self-Reliance (SFS) scheme and Emergency Relief (ER).

The Hong Kong employee benefits market research report provides in-depth industry analysis, information, and insights into employee benefits in Hong Kong, including an overview of the state and compulsory benefits in Hong Kong, detailed information about the private benefits in the country, insights on various central institutions responsible for the administration of the different branches of social security and the regulatory framework of the employee benefits in Hong Kong.

Regulations Guiding Employee Benefits Market in Hong Kong

Some of the key regulations guiding the employee benefits market in Hong Kong are The Law on Social Assistance, 1971, The Law on Universal Old-Age and Disability Allowance, 1973, The Law on Universal Higher-Rate Disability Allowance, 1988, and The Law on Comprehensive Social Security Assistance, 1993 among others.

Hong Kong Employee Benefits Market Segmentation by State and Compulsory Benefits

The key state and compulsory benefits offered by employers in Hong Kong are retirement benefits, death in service, long-term disability benefits, short-term sickness benefits, medical benefits, workers’ compensation insurance, maternity and paternity benefits, and other benefits.

Workers’ Compensation Insurance: In Hong Kong, the workmen’s compensation scheme is regulated by the Law on Employee’s Compensation Ordinance of 1953, with amendments in 2006. This scheme comes under the employer liability system. Employers purchase insurance policies from private insurance companies to provide benefits to their employees. This scheme is administered by the Labor Department.

Short-Term Sickness Benefits: The Law on Employment Ordinance of 1968, with amendments from 1997, and the Law on Social Assistance of 1971 regulate short-term sickness benefits in Hong Kong. These benefits are paid under both the employer liability system and CSSA. The employer liability system provides cash benefits to all employed individuals and is administered by the Labor Department. Self-employed individuals are excluded from this scheme. CSSA covers all residents of Hong Kong and is administered by the SWD.

Hong Kong Employee Benefits Market Segmentation by Private Benefits

The key private benefits offered by employers in Hong Kong are retirement benefits, death benefits, medical benefits, disability benefits, accidental death and dismemberment benefits, and other benefits.

Death Benefits: In Hong Kong, employers provide death benefits through group life insurance plans; Few employers provide packaged group life and personal accident insurance plan. The minimum membership limit is five members; however, there are plans for companies with three to 50 employees also

Medical Benefits: In April 2019, the Food and Health Bureau implemented the Voluntary Health Insurance Scheme (VHIS) in the country. As of March 31, 2022, there were more than 1.1 million policies registered under the VHIS. Employers provide medical benefits to their employees by subscribing to the VHIS or a group medical insurance plan. Specific group medical insurance plans are available for employees working in small- and medium-sized businesses. Critical illness is also provided under group life cover.

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Scope

This report provides a detailed analysis of employee benefits in Hong Kong –

• It offers a detailed analysis of the key government-sponsored employee benefits, along with private benefits.
• It covers an exhaustive list of employee benefits, including retirement benefits, death in service, long-term disability benefits, medical benefits, workmen’s compensation insurance, maternity and paternity benefits, family benefits, unemployment benefits, Long-term care benefits, leaves and holidays, and private benefits.
• It highlights the economic and regulatory situations relating to employee benefits in Hong Kong.

Key Highlights

• Social Welfare Department (SWD), and Mandatory Provident Fund Schemes Authority (MPFA) are responsible for the functioning of the overall social security system.

• A person’s national insurance contribution is determined based on their income.

• An insured person who is unemployed or unable to work and whose benefits have been exhausted is entitled to a credited contribution.

• In Hong Kong, employers provide voluntary retirement benefits to their employees through ORSO retirement plan.

Reasons to Buy

• Make strategic decisions using in-depth information related to employee benefits in the country.
• Assess employee benefits of the market, including state and compulsory benefits and private benefits.
• Gain insights into the key employee benefit schemes offered by private employers in the country.
• Gain insights into key organizations governing the employee benefits market, and their impact on companies.