[co-authors: Catherine Leung, Gladys Ching, Oscar Hui]*
The Hong Kong government has proposed to relax the so-called ‘418’ rule for determining continuous employment for the purpose of statutory employment entitlements.
What is the ‘418’ rule?
Currently, the ‘418’ rule specifies that an individual working for the same employer for four or more consecutive weeks, with each week working at least 18 hours, is considered to be under a ‘continuous contract’ of employment (‘continuous employment’) within the meaning of the Employment Ordinance. An employee under continuous employment is eligible for various benefits under the EO, such as sick days, annual leave, and other statutory entitlements.
The proposed change
Instead of assessing whether the employee has the number of qualifying hours on a week-by-week basis, the Hong Kong government’s proposal is to tally the employee’s total work hours over a four-week period, such that continuous employment will be triggered if an employee works at least 68 hours over a four-week period. The intention of the proposed change is to extend statutory benefits to a wider pool of employees, particularly those in part-time or casual employment.
Takeaway for employers
A bill implementing this proposed change will be tabled before the Legislative Council in due course. In the meantime, employers may wish to consider how this proposed change may impact its employees and payroll arrangements.
*Lewis Silkin
