Understanding a continuous contract under Hong Kong’s Employment Ordinance
A continuous contract in Hong Kong requires four weeks of service and at least 18 hours of work per week to gain full employment rights.
What Is a Continuous Contract in Hong Kong
A continuous contract in Hong Kong is an employment relationship where an employee has been employed continuously by the same employer for four weeks or more and works at least 18 hours each week. This status unlocks most statutory protections under the Employment Ordinance (Cap. 57). The rule is commonly called the 4-18 rule, and it is the threshold for key entitlements including rest days, paid annual leave, sickness allowance, severance payment and long service payment.
4-18 Rule Hong Kong Employment
The 4-18 rule is the test set out in the Employment Ordinance for determining whether an employee is under a continuous contract. An employee meets the test if they have been employed by the same employer for four weeks or more and has worked at least 18 hours in each of those weeks. The four weeks do not need to be consecutive in the sense of calendar weeks; they are four consecutive weeks of employment. Once the employee satisfies the rule, the contract becomes continuous from the first day of employment, not from the date the rule is first met. The Labour Department provides guidance on how the rule operates in practice.
Continuous Contract Entitlements HK
Once an employee is under a continuous contract, they become entitled to a range of statutory rights that are not available to employees who do not meet the 4-18 threshold. These include paid rest days, statutory holidays with pay, paid annual leave, sickness allowance, severance payment and long service payment. The Employment Ordinance also grants protection against unreasonable dismissal and the right to payment in lieu of notice. Each entitlement has its own qualifying conditions and calculation methods, which are set out in the Ordinance.
Employment Ordinance Continuous Contract
The Employment Ordinance (Cap. 57) is the primary legislation governing employment rights in Hong Kong. The continuous contract provision is found in Part I of the Ordinance, which defines the scope of application. Employers should note that the Ordinance applies to all employees engaged under a contract of employment, with limited exceptions such as those working for certain government bodies or in certain categories specified by the Director of Labour. The continuous contract test is the gateway to the Ordinance's core protections.
Statutory Rights Continuous Contract HK
The statutory rights that flow from a continuous contract include:
| Entitlement | Key Features |
|---|---|
| Rest days | At least one rest day in every seven days |
| Paid annual leave | Seven days in the first year, rising to 14 days in the ninth year |
| Sickness allowance | Up to four days paid per period after a qualifying period |
| Severance payment | For employees with at least two years' continuous service |
| Long service payment | For employees with at least five years' continuous service |
| End-of-year payment | If provided for in the contract |
Employees who do not meet the continuous contract test receive only the basic protections such as wage payment and statutory holidays without pay. The Labour Department publishes explanatory leaflets on each of these entitlements.
How the Continuous Contract Is Determined
The Labour Department applies the continuous contract test to the actual working arrangement, not to what the contract states. An employer cannot contract out of the 4-18 rule by describing a position as casual or part-time if the employee in fact works four weeks at 18 hours or more each week. Where an employee works for multiple employers, the hours are not aggregated; only hours worked for the same employer count towards the test. If an employee works different hours each week, the test is applied to each week individually. The employee must work at least 18 hours in each of the four weeks.
Practical Considerations for Employers
Employers should maintain accurate records of hours worked for all employees, regardless of whether the employee is believed to be under a continuous contract. The Employment Ordinance requires employers to keep records of wages, working hours and rest days for at least six months after the termination of employment. Failure to maintain proper records can result in prosecution. Employers should also be aware that the continuous contract status can affect obligations under the Mandatory Provident Fund scheme, although the MPF obligation applies from the first day of employment and is not contingent on the continuous contract test.
Where to Get Further Information
The Labour Department issues comprehensive guidance on the continuous contract rule and the associated entitlements. Employers and employees can consult the Department's website at labour.gov.hk or visit any Labour Department office. The Employment Ordinance (Cap. 57) is available on the Hong Kong e-Legislation website. Legal advice should be sought for specific situations, particularly where the pattern of work is irregular or where there are questions about the application of the 4-18 rule to particular industries.
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