In Hong Kong ‘s dynamic food and beverage (F&B) sector, understanding the employment regulations is vital for both employers and employees. The transition from 418 to the 468 rule has significant implications for the employment practices within the industry. This article brings changes offering insights to the impact over F&B sector.
As the Hong Kong government plans to relax the continuous contract rule under the Employment Ordinance “418 to 468” the employees who work under for the same employer for a combination of 68 hours in total over four consecutive weeks, will be safeguarded by the employment laws. The legislative law is expected to complete the process in 2025.
The previous 418 which is the “broken 418” has flaws whereas the employees do not meet the “418” aspects (non-418 employees) as per the implementation they are unable to enjoy the statutory employment benefits, allowing employers to reduce the costs.
In this blog, you will understand the differences between 416 and 418, also gives the key insights that impact the catering industry with the employment ordinance 468 in Hong Kong.
Let us now understand the changes employers and HR professionals need to consider after the ‘468’ rule is enacted.
Enactment of HR professionals and Employers by the Deployment of 468 rule
- Continued Employment for Non-418 Employees: – In Hong Kong, the employers are subjected to put forward mutual agreement for non-418 employees. Based on the continuing the job (continued contracts by the non-418 employees) the employers are required to make unilateral changes and modifications to employee contracts as changing to the working hours. All these changes are subjected by the employers as constructive dismissal to the employees if not followed by the employees.
- Calculation of Continued Employment Contracts: – Employers calculate continuous employment employees based on the ‘468 rule’ instead of 418. Employers might consider hiring the employees based on 418 rules but may lead to staffing shortages. Thus, this legislation leads and fix up to the employees with benefits.
Learn on how replacing 418 rule to “468 rule” can face changes between both employers and employees in Hong Kong.
Now let’s understand the differences between the 418 rule and 468 rule in Hong Kong. Here we move on.
Key Differences between “418 rule” and the proposed “468 rule” in Hong Kong
Weekly Working Hours Requirement
418 Rule:- Requires a minimum working hours of 18 hours for a single week of four consecutive weeks.
468 Rule:- Proposes an aggregate of working hours of 68 hours with flexibility over any 4 consecutive weeks offering a greater threshold mainly for part-time workers in catering and hotel industry.
Flexibility with Work Schedules
418 Rule:- Highly demands for weekly working hours where is not adaptable for irregular or part-time work patterns.
468 Rule:- Allows variably for weekly working hours, benefiting employees who works at fluctuating hours over considering the total hours in a monthly-long period.
Employee Coverage
418 Rule:- Limits for continuous contract employees and excluding the part-time and casual workers.
468 Rule:- Expands eligibility and potentially for statutory benefits including part-time and casual workers.
Employer Considerations
418 Rule: – Employers could arrange work schedules to keep employees below 18-hour weekly threshold thereby limiting the benefit obligations.
468 Rule: – Employers need to reassess staffing arrangements and contractual agreement to ensure compliance with new aggregate hour requirement, possibly leading to increased operational costs.
The transition of 418 to 468 enhances Hong Kong to effort for modernise employment regulations aligning them with contemporary work practices providing protection for broader modern segment workforces.
Implications of 468 to Food and Beverage industry
The F&B industry known for its reliance on part-time and casual labor, faces specific challenges and considerations due to this regulatory shift:
Adjustment of Workforce Scheduling
Employers may need to reevaluate scheduling practices to align with the new “468” criteria. Ensuring that employees meet the required hours over six weeks is essential for compliance and to maintain employee benefits eligibility.
Review of Employment Contracts
Employers should review and possibly revise existing employment contracts to reflect the updated rule. Clear communication of these changes to staff is vital to prevent misunderstandings and potential disputes.
Refer to more on how HRMS in Hong Kong handles payroll localization by considering changing employment contracts.
Impact on Employee Benefits
Employees previously qualifying under the “418” rule might find themselves ineligible under the “468” rule if their working hours don’t meet the new threshold. This could affect entitlements such as paid leave and sickness allowance.
Compliance and Legal Considerations
Non-compliance with the updated ordinance can lead to legal repercussions. Employers must stay informed about these changes to avoid penalties and ensure fair treatment of employees.
Stay Compliant and informed with the latest law updates by our Payroll Software!
But how easily it can be implied in catering and hotel sector with 468 rules? To get activated the employers must take several actions in their sector.
Let’s see how employers must consider and implement the latest 468 rule.
Steps Employers in the F&B Sector Must Take
To navigate these changes effectively, F&B employers should consider the following actions:
Conduct Internal Audits: Assess current employee work patterns to identify who may be affected by the rule change.
Update Policies and Procedures: Revise internal policies to ensure they align with the “468” rule, particularly those related to scheduling and benefits eligibility.
Employee Communication: Clearly inform employees about how the changes impact their employment terms and benefits.
Seek Legal Counsel: Consult with legal experts specializing in Hong Kong employment law to ensure full compliance and to address any specific concerns.
Streamline all your calculations with the latest regulations in Hong Kong’s ultimate HRMS software!
Key takeaways
The shift from the “418” to the “468” rule represents a significant change in Hong Kong’s employment landscape, especially for the F&B sector. By proactively adjusting to these changes, employers can maintain compliance, uphold employee trust, and continue to operate smoothly in a competitive market.
Start your journey with Info-Tech! To gather personalised discussion with our professionals contact us immediately!
