Hong Kong business costs change and MPF plan is no different, labour minister says
Official in charge of plan forcing employers to pay their employees’ retirement fund out of pocket argues advance warning gives firms time to adjust
All firms in Hong Kong face changing business costs, so they should be able to cope with officials’ advance warning to dig deeper into their own pockets to pay employees’ severance and long-service payments, the city’s labour minister said on Sunday.
Currently, employers match the 5 per cent of salaries that workers must contribute to the compulsory fund, and companies are now allowed to withdraw from MPF accounts to “offset” long-service or severance payments.
“Most employers only need to spend 12 years to pay 1 per cent more in business costs for when offsetting is abolished,” Law said. “Ask any businessman. They probably need to adapt to bigger cost changes each year.”