Employee Choice Arrangement: did employers’ duties change?

This article is a rewrite of a report from August 2012.

“Semi-free choice” gave workers a new right — but what about employers? The answer: MPF employer obligations stayed largely intact — choosing trustees, enrolling new hires, contributing each pay cycle, all unchanged.

What must employers still do?

The new scheme didn’t touch employers’ MPF administration: they still chose the trustee and scheme for staff, enrolled newcomers into the existing scheme, and contributed for everyone into that scheme.

When employees exercised the transfer right, they dealt directly with their chosen new trustee — no employer involvement needed. And since employees couldn’t move the employer-contribution portion, severance and long-service-payment offset arrangements were unaffected.

How could employers help?

By sharing information, not doing the paperwork. Transfer forms required the original trustee and scheme names, the employer’s registered scheme name, and the employer identification number — employers could supply these details proactively, help staff complete forms, and share trustee and MPFA contact details for direct enquiries.

When could transfers happen?

Employees could move accrued benefits from their own mandatory contributions in the current account to a favoured trustee and scheme once per calendar year — or simply do nothing and stay.

Questions? Call the MPFA hotline on 2918 0102.