Should you terminate and rehire your helper to get levy relief?

Dear Friends,

Recent changes in HK government policy regarding the levy have caused great confusion. You may be wondering "should I terminate my contract with my helper and re-sign another contract. Here are some issues you need to consider:

1)  Don't make a hasty decision. The government may not be finished changing the levy policy and the procedures.. They did not consider the consequences of what would happen if all the HK people fired and rehired their employees at the same time. Now they are reacting to protests from employers and helpers alike. Don't be in a hurry to make a decision. Wait a week or two because there may be more amendments to the policy.

Under the current law, a DH is not allowed to work unless she is under contract, if you fire your present helper, and she must leave HK, what will you do? The HK policy has not yet made it clear if they will allow a contract worker to stay and work whilst the new contract is processed at IMD (6-8 weeks)

2) Look at your records. When did you last pay the levy? If you recently made a payment, there is NO NEED for rash action. The government is not going to give you a refund, so if you have 3-6 months of levy already paid up, then relax and do your homework before making a decision.

3) Do the math. How much total levy have you paid? If you have paid more than 1 year's worth of the levy, then it might not be worth taking action. The levy for 2 years is $9600. If, for example, you have already paid $4800, you can possibly gain $4800 by terminating and re-signing your helper, BUT WAIT...

$4800 sounds good, but don't forget to subtract
$3480 in lieu of 1 month's notice (give 1 mo. notice and save this amount)
$2000 for round trip ticket to the Philippines
$XXXX for the pain and suffering you will have while you wait for her to return (up to 2 months with no helper)
$ 100/month in higher salary x 12 months = $1200/year
$ 800 Arrow agency fee for processing the new contract for terminated helper

4)  Think it through. Do you want to keep your helper for another 2 years? Does she want to work for you for another 2 years? Don't take the answer for granted.

5) Talk to your helper. Your helper is probably feeling insecure and frightened. She is wondering if you are going to terminate her to save money. Talk to her about this issue. If you decide to take this step, make the decision jointly, and plan it so that it causes both you and her the least amount of trouble.

If you have any questions please feel free to call us. Since the government policy is still changing, we may not be able to give you firm answers. You may also want to call the Immigration hotline for the latest news. 

HK IMD Tel 2824 6111  Fax: 2877 7711



For complete information on the Government policy on the levy, click here.

At your service,

Allan and Ione Smith