Hong Kong: Updates on maternity pay, discrimination, statutory holidays and offsetting severance pay

A busy start to 2021 for Hong Kong employers with a number of new changes coming into effect or on the horizon. The Government has recently announced that employers can now seek reimbursement for the additional statutory maternity leave which came into effect in December 2020. From next month, new mothers will also benefit from greater protections against discrimination on the basis of breastfeeding. Proposed changes to increase statutory holidays from 12 days to 17 days have also moved ahead as have efforts by the Government to abolish the “offsetting” arrangement in respect of the severance and long service payments. Read on for more details.

Maternity leave pay reimbursement

Further to our last update, statutory maternity leave increased from 10 weeks to 14 weeks from 11 December 2020. From 1 April 2021, employers can apply online for reimbursement of the additional four weeks’ statutory maternity leave pay. The reimbursement amount is capped at HK$80,000 per employee under the Government’s Reimbursement of Maternity Leave Pay Scheme. Applications under the Scheme are subject to the following requirements:

a. the employee covered under the application is eligible to receive statutory maternity leave pay under the Employment Ordinance (“EO”). Namely, she has been employed under a continuous contract of employment for at least 40 weeks before the commencement of her statutory maternity leave;

b. the employee has taken her statutory maternity leave and the employer has paid statutory maternity leave pay to her for all 14 weeks’ of statutory maternity leave;

c. the employee’s date of confinement was on or after 11 December 2020; and

d. the employer has not received any other government funding in respect of the additional four weeks of statutory maternity leave pay for the employee.

Applications can be made through an online portal.

Discrimination against breastfeeding women

Our previous article outlined changes to the Sex Discrimination Ordinance (“SDO”) from June 2020 which included new provisions to protect breastfeeding women from direct and indirect discrimination, as well as victimisation in relation to employment. These amendments will soon come into force.

From 19 June 2021, breastfeeding will be one of the protected characteristics under the SDO. The protection applies not only to the act of breastfeeding and expressing milk to feed a child, but also to the status of being a breastfeeding mother. Direct and indirect discrimination against, or victimisation of, a breastfeeding mother will be unlawful. The Equal Opportunities Commission has published guidance which sets out recommended practices for employers to adopt in preventing discrimination against breastfeeding in the workplace (see Equality for Breastfeeding Women Guidance for the Employment and Related Sectors for details).

Employers should review their policies and practices to ensure they are compliant.

Additional five days of statutory holidays

In March 2021, the Government gazetted the Employment (Amendment) Bill 2021 which includes proposed amendments to the EO so that, from 2022 to 2030, five statutory holidays (most commonly referred to as “public holidays”) will progressively be added. Currently, there are 12 statutory holidays, although many employers already provide employees with 17 general holidays even where they are not required to do so as they are not a bank, educational establishment, public office or Government department. By 2030, the five additional general holidays will also be statutory holidays. These five additional statutory holidays are:

a. the Birthday of the Buddha (starting from 1 January 2022);

b. the first weekday after Christmas Day (starting from 1 January 2024);

c. Easter Monday (starting from 1 January 2026);

d. Good Friday (starting from 1 January 2028); and

e. the day following Good Friday (starting from 1 January 2030).

Abolishing offsetting of severance and long service payments

In 2016 the Government first proposed to gradually abolish the mechanism which allows employers to offset severance and long service payments against employer’s contributions to the Mandatory Provident Fund and other retirement schemes. While little progress on this has been made, the Government recently stated that it seeks to press ahead with this agenda. The Government indicated it plans to introduce the bill which would reduce the offsetting mechanism in the 2022 term of the Legislative Council, with a view to securing its passage and implementing the abolition of offsetting in around 2025. Employers can continue to monitor this proposal.

Update to safety and personal data privacy laws

Lastly, we are closely monitoring proposed changes in other areas of laws relevant to employers and employees.

Proposed changes to Hong Kong’s safety laws which will significantly increase penalties have been delayed. See our Safety Snapshot for a reminder on the proposed changes. The Government is launching a new round of consultation and aiming to submit an amendment bill to the Legislative Council later this year. As more detail comes to light, we will cover this in our Safety Snapshots series.

Separately, the Government continues to consider possible amendments to the Personal Data (Privacy) Ordinance which will impact Hong Kong employers such as proposed changes to mandatory data breach notifications and data retention periods as well as increased penalties. We will report on further developments in the coming months.

For further information, please contact Tess Lumsdaine and Giselle Yuen.