Global Employer Services Newsletter August 2020

Second tranche of subsidies under the Employment Support Scheme (ESS) unveiled by the HKSAR Government

The Government announced on 18 August 2020 details concerning the application of the 2nd tranche of subsidies under the Employment Support Scheme (ESS). 

Below are details of the application:

  1. Subsidies will cover which period of staff wages?
    Employers are expected to apply the fund to subsidise their payment of staff wages from September 2020 to November 2020.
  2. When can employers expect to receive wage subsidies?
    The 2nd tranche of subsidies would be disbursed in mid-September 2020 (the earliest).
  3. Application procedures for second tranche of subsidies under ESS
    The eligibility and procedures for application of the 2nd tranche as well as the formula on penalties and claw-back of the subsidy because of employers’ failure to fulfil their undertaking will remain unchanged as that of the 1st tranche, except for the followings:
  • The employers may change the specified month previously selected from either December 2019, January, February, or March 2020 as the “specified month” as the basis of calculation of the subsidy (whilst there will be no change of headcount measured against the employer’s headcount as per MPF/ORSO contribution record in March 2020); and
  • The employees whose age reached 65 or above, even if their employers have not paid salary and made MPF voluntary contribution for them in March 2020 or thereafter, but if they still maintain their MPF accounts with the MPF trustee, will get HK$5,000 per month per employee in subsidies. The employers of the elderly employees who receive the subsidies have to undertake to spend all the wage subsidies on paying wages to their employees.

The Government has also set requirements for two leading supermarket chains (Park’nshop and Wellcome) and large-scale estate management firms to undertake extra commitments upon receipt of the 2nd tranche of subsidies under ESS:

  1. The large-scale estate management companies will be required to contribute 80% of the 2nd tranche of the subsidy they receive to subsidise the residents and/or the incorporated owners of properties for the maintenance fee and property management fee; and
  2. Park’nshop and Wellcome will be required to contribute the 2nd tranche of the subsidy they receive to either provide discounts for customers, or offer coupons for socially vulnerable groups.

Joseph Hong