Hong Kong’s MPF authority to propose 2-tier surcharges for late employer contributions

Hong Kong employers could face punitive surcharges for failing to clear outstanding contributions to their staff members’ pension accounts for extended periods, with data showing only one in six bosses settled the arrears within the prescribed two-week deadline.The Mandatory Provident Fund Schemes Authority (MPFA), which manages the city’s pension plans, said it was working on a “two-tier surcharge” mechanism proposal that it hoped to present to the government by the middle of the year.In a blog post on Sunday, authority chairwoman Ayesha Macpherson Lau revealed that her agency issued an average of 31,000 notices every month to employers who failed to make MPF contributions on time.Under existing legislation, employers are required to clear the arrears and pay surcharges amounting to 5 per cent of the outstanding sums, within two weeks.“Only about 16 per cent of non-compliant employers settled the outstanding contributions and surcharges within the 14-day deadline specified on the notices,” Lau said.She also disclosed that only about half of the non-compliant employers would settle the outstanding contributions and surcharges within about four months.