MPF employer obligations Hong Kong: the three-tier fine schedule for defaulting employers

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

For years the MPFA dealt with offending employers mainly through discretionary warnings — but violations persisted. From the third quarter of 2012, persuasion gives way to instant fines. Here is the full three-tier schedule.

How does the three-tier fine schedule work?

From the third quarter of 2012, three defaults bring a fine of HK$5,000 or 10% of the contributions, whichever is higher; missing termination notices draw HK$5,000, HK$10,000 and HK$20,000 for first, second and third offences; withholding contribution records costs HK$10,000, HK$20,000 and HK$50,000. The MPFA’s head of member protection said failures to file termination notices alone ran to about 1,000 cases a year.

What do the enforcement figures show?

From April to December 2011 the MPFA received 3,243 complaints, down 9.9% year on year, and issued 1,296 summonses against 107 employers and 22 senior officers or directors, averaging HK$29,300 — below the 2,594 summonses and HK$32,900 average of 2010/11. (Figures as of December 2011.) Its chief operating officer (enforcement) credited deterrence and publicity; five five-minute shorts co-produced with RTHK aired on Sundays across three stations.

Which case carried the strongest warning?

In December 2011 an employer who never enrolled a worker, made no contributions, yet deducted 5% of pay as fake contributions received a 60-hour community service order — the first of its kind. The MPFA’s online blacklist of defaulting employers, launched in May 2011, held about 3,800 records, with more than 20 on the repeat-offender list. Employers can review their obligations in the MPF education guides.