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At-a-glance: the Hong Kong 2018 Policy Address


A year and three months into Carrie Lam’s administration, Hong Kong’s chief executive presented her second policy address at the Legislative Council yesterday. A raft of new pro-labour initiatives were laid out and we have selected four points HR professionals should know about:

1. Maternity leave (ML) Lam proposes to extend statutory maternity leave from the existing 10 weeks to 14  weeks.

The current ML pay rate, four-fifths of the employee’s average daily wages, will also be applied to the additional four weeks pay. The cap is HK$36,822 which is the four weeks ML pay of employees with a monthly wage of HK$50,000.

The cost of this extra ML pay will be reimbursed to the employer by the government.

2. The Mandatory Provident Fund (MPF) System The offsetting arrangement of severance payment (SP) and long service payment (LSP) with employers’ mandatory contributions under the MPF System will be rescinded two years after the legislative council and the government are in accord.

The government will placate the employers with a two-tier subsidy under which the second-tier subsidy period will be substantially extended from the originally proposed 12  years to 25  years. There is an approximate HK$12.1 billion surge from the government’s preliminary total financial commitment.

Lam’s government will assist employers in setting up designated saving accounts (DSAs) under their own name to prepare in advance for their potential SP or LSP expenses in the future. Employers will contribute 1% of their employees’ monthly relevant income to their DSAs until reaching 15% of the annual relevant income of all their employees.

3. Local innovation and technology talent investment

Lam unveiled a blueprint addressing the shortage of local IT talent:

  • Establish two research clusters at the Hong Kong Science Park on healthcare technologies and artificial intelligence/robotics technologies.
  • Double the funding for the technology transfer offices of designated universities; funding provided to designated universities under the Technology Start-up Support Scheme for Universities; and funding provided to the State Key Laboratories and Hong Kong branches of Chinese National Engineering Research Centres.
  • Allocate HK$2 billion for launching a “reindustrialisation funding scheme”.
  • Inject $20 billion into the Research Endowment Fund of the Research Grants Council; launch a $3 billion Research Matching Grant Scheme; and introduce fellowship schemes for outstanding academics in Hong Kong.

4. Paternity leave Lam will continue to urge the legislative council to pass the bill of increasing statutory paternity leave from the current three days to five days. It was introduced in late June this year in the Employment (Amendment) Bill 2018.

Titled “Striving ahead, rekindling hope”, this policy address sets out the framework on the Lantau reclamation plan, national security law, e-cigarettes prohibition, housing schemes, and many more.

Lam’s key pledge has been: “Hong Kong people are outstanding and our foundations are solid. As long as we stand united and remain focused, I have no doubt that we will scale new heights.”

Photo/ HK financial news

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