MPF minimum income threshold raised to $6,500: the rules effective 1 November 2011

When Hong Kong’s minimum wage took effect in May 2011, many low-paid workers got a pay rise — only to fall into the MPF contribution net, with 5% of the gain eaten by contributions. From 1 November 2011, the minimum relevant income level rose from $5,000 to $6,500 a month: employees earning below that no longer had 5% deducted from their pay.

What was the MPF minimum income threshold?

The MPF minimum relevant income level was revised from $5,000 to $6,500 a month with effect from 1 November 2011: employees earning below $6,500 a month were exempt from the employee contribution, though employers had to keep contributing. For casual employees in construction and catering under Industry Schemes, the daily-wage floor rose from $160 to $250; self-employed persons (e.g. taxi drivers) earning under $6,500 a month or $78,000 a year were exempt immediately, with trustees updating arrangements automatically. The MPFA reminded employers to update their contribution-calculation systems.

MPF contribution rate and income thresholds

How did contribution periods straddling two months work?

An MPFA spokesperson told iFund Channel employers to watch the contribution-period mechanics: for a 1st-to-month-end period, stop deducting the 5% from the 1–30 November period; for a period straddling two months, e.g. the 10th to the 9th of the next month, stop deducting from the 10 November–9 December period.

Saving 5% now, or a smaller pension later?

A few hundred dollars more a month obviously cheered low-paid workers. 蒙兆達 of the Confederation of Trade Unions illustrated with the minimum wage: working 8 hours a day, six days a week, pay came to about $5,376; without the higher floor, take-home would shrink to about $5,107 — every dollar counted under high inflation. But the flip side: with only the employer portion left, the employee’s pot would grow at half speed, shrinking retirement protection. The union had proposed the government contribute 5% on behalf of exempt low-paid workers, arguing this was no double subsidy alongside CSSA or transport allowances — those relieve immediate hardship, while proxy contributions are long-term retirement protection. The MPF education hub explains the contribution rules in full.