Payroll Concepts > Pay-Related Calculations > Salary Calculations

SimplePay performs basic salary calculations automatically in line with the standard Employment Ordinance rules when you enter the relevant hours for your employees. More information on capturing employee hours can be found in the following sections:

SimplePay does not, however, calculate overtime automatically. In order to record overtime, you have to create custom items. For more information about how to create custom items, please refer to:

Overtime

Hong Kong law does not confer any additional rights on employees to receive any overtime pay apart from the Statutory Minimum Wage protection that wages payable to an employee in respect of any wage period shall not be less than the amount of minimum wage, calculated by multiplying the total number of hours worked by the employee in the wage period by the Statutory Minimum Wage rate.

The employment agreement should state whether overtime is paid or unpaid and the rate of pay, if appropriate.

Rest Days

The Employment Ordinance provides that there must be not less than 1 rest day in every period of 7 days and the rest days shall be in addition to any statutory holiday or alternative or substituted holidays. One rest day is counted as a continuous period of not less than 24 hours when which the employee can be absence from working for his employer.

Rest days shall be appointed by the employer. They may be granted on a regular or irregular basis:

  • regular rest days – the employer should inform his employees of the arrangement
  • irregular rest days – before the beginning of each month, the employer must inform his employees orally or in writing the appointed rest days or by displaying a roster showing the dates of the appointed rest days for each employee

An employer may substitute some other rest day with the consent of the employee, in which case it must be within the same month before the original rest day or within 30 days after it.

An employer must not compel an employee to work on a rest day except in the event of a breakdown of machinery or plant or in any other unforeseen emergency. For any rest day on which the employee is required to work, the employer should substitute some other rest day within 30 days after the original rest day. The employer should notify the employee of the arrangement within 48 hours after the employee is required to work.

The rest days may be with pay or without pay as agreed between an employer and an employee.

Statutory Holidays

An employee, irrespective of his length of service, is entitled to 17 statutory holidays in 2020. You can view these holidays here.

If a statutory holiday falls on a rest day, the employee should be granted a holiday on the next day which is not a statutory holiday or an alternative holiday or a substituted holiday or a rest day.

An employee having been employed under a continuous contract for not less than three months immediately preceding a statutory holiday is entitled to the holiday pay. Holiday pay should be paid to the employee not later than the day on which he is next paid his wages after that statutory holiday.

The daily rate of holiday pay is a sum equivalent to the average daily wages earned by an employee in the 12-month period preceding the following specified dates. If an employee is employed for less than 12 months, the calculation shall be based on the shorter period.

For more information about how the average daily wage is calculated, please go to:

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