Employment: Contract and wages

Statutory Minimum Wage

The Minimum Wage Ordinance (Cap. 608) came into operation on 1 May 2011. Since then, the Statutory Minimum Wage (SMW) has become effective on the same day. With effect from 1 May 2019, the statutory minimum wage rate is revised to $37.5 per hour. In essence, wages payable to an employee in respect of any wage period, when averaged over the total number of hours worked in the wage period, should be no less than the SMW rate.

Since the calculation of minimum wage excludes the time that is not hours worked, payment made to the employee for any time that is not hours worked (e.g. rest day pay, holiday pay, annual leave pay, maternity leave pay, sickness allowance, etc.) must not be counted as part of the wages payable to the employee.

Failure to pay minimum wage amounts to a breach of the wage provisions. Under the Employment Ordinance, an employer who wilfully and without reasonable excuse fails to pay wages to an employee when it becomes due is liable to prosecution and, upon conviction, to a fine of $350,000 and to imprisonment for three years.

The Labour Department has set out some guidelines on SMW. You may click the following links to download the guidelines:
Statutory Minimum Wage: Reference Guidelines for Employers and Employees
Concise Guide to Statutory Minimum Wage

Statutory Minimum Wage (SMW) applies to all employees, whether they are monthly-rated, daily-rated, permanent, casual, full-time, part-time or other employees, and regardless of whether or not they are employed under a continuous contract* as defined in the Employment Ordinance, with the following exceptions:

  • persons to whom the Employment Ordinance does not apply (please click here for details)
  • live-in domestic workers
  • student interns as well as work experience students during a period of exempt student employment

Please note that SMW also applies to employees with disabilities and able-bodied employees alike. Special arrangement is provided under the Minimum Wage Ordinance so that persons with disabilities have the right to choose to undergo a productivity assessment to determine whether they should be remunerated at not lower than the SMW level or at a rate commensurate with their productivity. For details, please refer to the webpage Productivity Assessment for Persons with Disabilities under the Statutory Minimum Wage Regime published by the Labour Department..

*An employee engaged under a “continuous contract” is defined as one who has been employed under a contract of employment by the same employer for four weeks or more and has worked for 18 hours or more each week (i.e. the so-called “4-18” requirement)