What Are the Maternity Leave Costs to Hong Kong Employers?

Kristina Coluccia
9 hours ago
3 min read

Maternity leave policies in Hong Kong are governed by the Employment Ordinance, which mandates specific obligations for employers when it comes to paid leave and job protection for pregnant employees. For businesses operating in or expanding into Hong Kong, understanding the cost implications of maternity leave is essential for compliance, budgeting, and effective workforce planning.

Overview of Maternity Leave Entitlements in Hong Kong

Under current regulations, female employees in Hong Kong are entitled to 14 weeks of maternity leave, provided they have been employed under a continuous contract for not less than 40 weeks before the commencement of the leave. The leave must begin between two to four weeks before the expected date of childbirth unless otherwise agreed upon by the employer.

Statutory Maternity Pay (SMP)

The employer is responsible for providing Statutory Maternity Pay (SMP) for 14 weeks. This pay is calculated at four-fifths (80%) of the employee’s average daily wages over a 12-month period, subject to a cap of HK$80,000 per employee.

It is important to note that the first 10 weeks of maternity leave are mandatory and must be paid by the employer. The additional four weeks—which were added to the statutory leave in 2020—are also paid at the same rate but the employer may apply for reimbursement of the additional costs from the Hong Kong government, up to a maximum of HK$80,000 per employee.

Indirect Costs to Employers

Beyond the direct expense of SMP, employers may face several indirect costs, including:

Temporary Staffing or Redistribution of Work: Businesses may need to hire temporary staff or redistribute work among existing employees, potentially increasing overtime or training costs.
Operational Disruption: In smaller teams or specialized roles, the absence of a key staff member can affect productivity and continuity.
Administrative Compliance: Ensuring all documentation, payroll adjustments, and reimbursement claims are processed correctly adds to the HR burden.
Employee Retention and Engagement: Employers that offer supportive maternity leave policies often see higher levels of employee satisfaction and retention, but building and maintaining such support structures requires strategic investment.

Compliance Risks and Penalties

Non-compliance with Hong Kong’s maternity leave requirements can lead to legal penalties, reputational damage, and strained employee relations. Employers must be particularly careful to ensure timely payments, proper record-keeping, and clear communication with affected employees.

Strategic Considerations for Employers

Given the costs and compliance obligations, companies operating in Hong Kong should consider the following strategic approaches:

Budget for Maternity Leave Costs: Incorporate maternity leave planning into annual HR and financial forecasts.
Streamline HR Processes: Automate payroll and leave tracking systems to ensure accuracy.
Build a Supportive Culture: Implement flexible return-to-work arrangements and parental support policies to enhance employee engagement.

How Woodburn Can Support Your Business

Navigating the maternity leave landscape in Hong Kong requires in-depth knowledge of local labor laws and proactive HR management. At Woodburn Accountants & Advisors, we specialize in helping international companies establish and manage operations in Hong Kong and Greater China. Our services include employment advisory, payroll compliance, and HR support, ensuring that your business remains fully compliant with maternity leave obligations while minimizing risk and administrative burden.

Woodburn Accountants & Advisors is one of China and Hong Kong’s most trusted business setup advisory firms.

Woodburn Accountants & Advisors is specialized in inbound investment to China and Hong Kong. We focus on eliminating the complexities of corporate services and compliance administration. We help clients with services ranging from trademark registration and company incorporation to the full outsourcing solution for accounting, tax, and human resource services. Our advisory services can be tailor-made based on the companies’ objectives, goals and needs which vary depending on the stage they are at on their journey.