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Severance Pay

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ORIGINAL POST
Posted by Magangkot 6 yrs ago
My domestic helper has been with us for 14 years, fulfilled six (6) 2 year contracts. Are they entitled for severance pay for the previous contracts honored, and not the current one (they are breaking this contract)? Ive heard a few conflicting answers, I've also contacted the HK labor department, in which they sent a website link and the read is also confusing.

Thank You.
 
 
 
ED's NOTE: you can find information on this on the HK Labour Department Website:
 
 
Q5:
Under what circumstances should an employer pay severance payment or long service payment to his/her FDH if he/she terminates the FDH's contract?
 
  
A5:
An employer should pay severance payment to his/her FDH if the FDH has been employed continuously for not less than 24 months and is dismissed (or his/her contract is not renewed) by reason of redundancy.
 

An employer should pay long service payment to his/her FDH if the FDH has been employed continuously for not less than 5 years and is dismissed (or his/her contract is not renewed) by reason other than serious misconduct of the FDH or redundancy.

However, an employer is not required to pay both long service payment and severance payment to the FDH.

 
  
Q6:
How to calculate the amount of severance payment and long service payment payable to the FDH?
 
 
A6:

Severance payment and long service payment are calculated as follows :

(monthly wages x 2/3) x reckonable years of services*

* service of an incomplete year should be calculated on a pro rata basis.

 

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COMMENTS
paul45 6 yrs ago
I have the exact same question. Our helper has presented us with a "computation of claims" from the Philippine consulate with a claim for severance payment. Everyone we have spoken to says they have never heard of domestic helpers getting severance payments. I presume this is because they are on 2 year contracts and that it is not considered "continuous" employment per the EO. It's not clear. If anyone has experience on this, any advice is appreciated.

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Boundaries 6 yrs ago
An employer should pay severance payment to his helper if the helper has been employed continuously for not less than 24 months and is dismissed (or his/her contract is not renewed) by reason of redundancy. ...
 
However, an employer is not required to pay both long service payment and severance payment to the helper.
 
 
Labour Department - Policy Support


We had to pay our helper severance pay upon her completing her two year contract with us. This was in accordance with the labour laws of Hong Kong.

In your case, am presuming you would have to pay her as employed continuously for the past 14 years. if not severance pay then long term service as per labour law.

You may want to call & speak to a customer service officer at the labour department to verify the requirements.

Here is the  link



Hope the above helps.

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orchardarea 6 yrs ago
My understanding is that severance is only paid the helper has been terminated and that as you enter into the 5th year, severance payment is required under Labour Law.
Sadly I also think this is the reason why a lot of employers do 2 contracts with the same helper and then do not renew after the second contract (because as they enter the fifth year) they have to pay a lump sum.

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