MPF default contributions: first company director jailed over unpaid contributions

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

In the twelfth year of the MPF system, a company director was jailed for the first time over MPF default contributions — sentenced to two months’ imprisonment, suspended for 12 months — while his company was fined HK$40,000 for false statements and arrears. The MPFA said it hoped the sentence would serve as a deterrent.

Who was jailed over MPF default contributions?

The company, a Hong Kong engineering firm, falsely reported an employee’s income and start date, failed to enrol the employee in an MPF scheme, and made no contributions totalling just over HK$10,000 from March to November 2008; its director and principal officer was convicted at Kowloon City Magistrates’ Courts and sentenced to two months’ jail suspended for a year, with the company fined HK$20,000 on each of two counts. An MPFA enforcement chief said employers must understand that defaulting on MPF is a serious offence.

How common are defaults, and how heavy are the penalties?

MPFA figures show convicted offending employers and senior officers rose from 58 (369 summonses) in 2006/07 to 207 (2,154 summonses) in 2010/11; under the MPF Schemes Ordinance, failing to enrol employees or defaulting on contributions carries up to HK$350,000 in fines and three years’ jail, while false statements to the MPFA or a trustee carry up to HK$100,000 and 12 months on first conviction.

How can employees check whether contributions are being paid?

Workers should review their MPF accounts regularly; the MPFA runs a contribution enquiry hotline (183 3030) that connects callers to their trustee’s hotline to check the past three months’ payment records, and its website carries a searchable register of offending employers and officers. Spotting a problem early is the best way to protect your retirement savings.