Can Employers Offset Severance Pay With MPF?

What is MPF offsetting?

Employers may use the MPF benefits accrued from their contributions to offset severance or long-service payments under the Employment Ordinance. The employer must pay the statutory sum first, then reclaim it from the trustee.

What protection do employees have?

If the employer underpays, the employee can apply in writing to the trustee with proof, asking for the employer’s accrued portion to be released as offset. Any shortfall can still be claimed from the employer.

How is it calculated?

Monthly wage × 2/3 × years of service (wage capped at HK$22,500). Check with the Labour Department or your trustee for details.

How to protect your own benefits?

Review statements regularly and consolidate accounts when changing jobs. Compare MPF funds on fees.