Legal Update: Proposed reduction on threshold on working hours for “continuous contract”

The Employment (Amendment) Bill 2025 (the “Bill”) proposes amendments aimed at enhancing labour protections by reducing the threshold of working hours in respect of “continuous contract” under the Employment Ordinance (“EO”) (see below).

Current regime

Currently, an employee employed by the same employer (i) continuously for 4 weeks or more, and (ii) having worked for 18 hours or more per week in every one of those 4 weeks, is regarded as being under a “continuous contract” (section 3 and First Schedule of the EO).  This is often referred to as the “4-18 requirement”.

All employees covered by the EO irrespective of their work hours are entitled to basic EO protections.  These basic protections include:

• Payment of wages (sections 23 – 25);
• Restrictions on wage deductions (section 32); and
• Statutory holidays (section 39).

However, employees under a continuous contract are also entitled to additional statutory benefits and protections under the EO.  They include:

• Maternity and paternity leave (sections 12 and 15E);
• Rest days (section 17);
• Severance payment (section 31B);
• Long service payment (section 31R).
• Sickness allowance (section 33);
• Holiday pay (section 40); and
• Paid annual leave (section 41AA).

(Collectively, “Statutory Benefits”).

As such, under the existing provisions of the EO, any employees who work less than the 18-hour weekly requirement within any week of the given 4 weeks will not be entitled to Statutory Benefits.

Amendments

The Bill will relax the regime and make it easier for employees to qualify for the Statutory Benefits and protections applicable to employees who are on a “continuous contract” under the EO.

In short, the Bill seeks to:

(i) lower the weekly working hours threshold from 18 hours to 17 hours; and

(ii) provide an alternative of using the aggregate working hours of 18 hours in each of 4 consecutive weeks as the qualifying threshold, and allow an aggregate of 68 working hours or more, within a 4 week period, to qualify an employee as working under a “continuous contract”.

The new alternative will assist employees with variable hours and whose working hours occasionally fall below the weekly threshold, to qualify them for the Statutory Benefits.

Potential impact

Currently, the work arrangements for some of employees are that they work less than the “continuous contract” threshold so that they are not entitled to Statutory Benefits.  If the Bill is passed, some of these employees who are currently under the threshold may reach or exceed the newly proposed threshold.  

Employers should take care and take steps to:

(1) adjust contractual arrangements and working practices to reflect any such change and avoid the risk of employee’s obtaining more statutory entitlement than was previously the case and more than the employer may be anticipating or aware of and/or

(2) make sure they monitor employees working hours properly to ensure they meet their additional legal obligations.

Should an employer fail to grant such Statutory Benefits, it may lead to civil claims and criminal prosecution.

Although the Bill has not been passed yet (where the Labour Department currently expects implementation in October 2025), employers should stay alert to any changes in the law and ensure that they comply with their statutory obligations under the EO. 

A copy of the Employment (Amendment) Bill 2025 is available here.

Russell Bennett and Mark Chiu

For more information on employment matters, please contact:

Russell Bennett
Partner | Email

Mark Chiu
Consultant | Email

Disclaimer: This publication is general in nature and is not intended to constitute legal advice. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.