Employees leaving Hong Kong: What can employers do to recruit and retain staff?

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Recently there have been a number of news articles in which employers in Hong Kong are expressing their concern over the high numbers of employees leaving the city and a lack of new arrivals

Employers point to Hong Kong’s strict Covid-19 measures, which are some of the strictest in the world, as the reason for the draining talent pool, with employees being subjected to lengthy periods of quarantine, extensive social distancing measures and mandatory testing. The city’s “zero Covid” or “dynamic zero Covid” policy falls far behind other economies which are opening up and living with the virus as an endemic.

So, what can employers in Hong Kong do to support new recruits and employees at this time (and hopefully avoid an attrition of the workforce)? We set out below some of our thoughts on worthwhile initiatives that employers can consider and adapt to their businesses.

Staff initiatives

Financial contributions

For employees entering Hong Kong or employees that wish to take a break and visit family abroad, employers may consider offering a financial contribution towards the cost of hotel quarantine (which is mandatory upon arrival into Hong Kong) and/or paying for the employee’s time spent in quarantine. This should ease the burden on staff traveling in and out of Hong Kong and result in staff committing to their roles in Hong Kong longer.

For example, some of the largest global financial institutions in Hong Kong such as Goldman Sachs and Morgan Stanley have offered their Hong Kong based staff US$5,000 each towards the cost of hotel quarantine.

Extra time off

Another initiative could be to allocate extra leave (whether paid or unpaid) to employees, which would greatly assist with an employee’s choice to travel when several weeks are required for time outside Hong Kong and time inside quarantine facilities.

Alternatively, extra flexibility could be afforded around the allocation of leave which could allow employees traveling abroad to use some of their allocated leave from the previous or following year to help with their travel plans. This is more likely to be a key consideration if your workforce is unable to work easily from a location outside the workplace.

For example, in the food and beverage industry, the Black Sheep Restaurants Group is reportedly providing staff with an extra week of unpaid leave (as well as a financial contribution and meals during the quarantine period). In return, Black Sheep staff have agreed to complete one year of service. There are therefore many ways in which such schemes can work for both the employer and the employee.

Further, employers should carefully consider their policy in relation to employees who may be affected by mandatory lockdowns of the estates they live in or placed under compulsory home quarantine. The government recently announced its intention to amend the Employment Ordinance so that employees would be eligible to take sick leave (with a statutory sickness allowance of four-fifths of salary) during such circumstances. Alternatively, employers may wish to adopt a policy that such employees be allowed to take sick leave with full salary paid or to work from home without deduction of pay.

Working from home

In order to facilitate a workforce that may be spending considerable amounts of time working from another location, employers should have a prescriptive flexible working policy in place. The policy should look to cover a range of scenarios, from working from home in Hong Kong to working from abroad in a hotel. The policy should clearly set out expectations and rules  for example requesting or reporting on working arrangements, confidentiality, IT measures and working from abroad.

That said, it is important to consider the tax implications of allowing employees to work from abroad. For example, if an employee spends over a certain amount of days working from another country, both the employee and the employer could be at risk of additional tax exposure. It is therefore highly recommended that employers closely monitor holiday requests which would involve working from abroad so that guidance can be given to the employee based on the location and duration of their trip.

IT infrastructure

IT systems and security protections should be put in place to allow an employee to work not only from home but also from a public location, such as a quarantine hotel, in a safe and secure manner. It is generally recommended that employees avoid using public WiFi in spots such as hotels. Instead, it is much safer if the employee uses a MiFi device to access the internet. Furthermore, it is generally good practice to ensure that use of a business’
email system, file system and intranet is protected by sufficient protections such as Multi-Factor Authentication for logging onto business accounts.

The number of cyber attacks in Hong Kong has increased over the last few years, coinciding with the city seeing more and more employees working outside the office. Therefore, measures to protect against the unwanted fallout of a cyber incident will be a worthwhile investment of resources.

Due to this heightened risk to IT infrastructure, many businesses would benefit from investing in cyber training for staff, security pen testing, cyber crisis tabletop exercises and cyber insurance.

Insurance

There are a number of insurance policies available in the market for employers to support different working arrangements. For instance, a working from home insurance policy would allow employers to care for the health, safety and well-being of employees whilst they are working from home by covering the costs of mental health support, ergonomic injury and accidents.For employees who are working from abroad, business travel insurance products may be appropriate in circumstances where the pandemic has brought an element of uncertainty to traveling in and out of Hong Kong.

Insurance can often be a commercial decision for a business to take so, if in doubt about the variety of insurance products in the market, employers may work with their brokers to study the existing insurance cover of the business and assess whether it is still suitable for any changes in working style (for eg the medical insurance policy may not be global medical insurance, but worldwide health cover may be desirable in circumstances where staff are increasingly working abroad for long periods of time).

Childcare support

Working from home has turned the home into a temporary office, but it does not stop there. The city continues to experience prolonged periods of school closures meaning that the home can also turn into a temporary school. For working parents who have had to double as school tutors, this is an added stress to the working day which employers should recognise and support.

This should not be a taboo topic and leaders of a business would benefit from being open and honest with their teams that childcare is an additional element to every parent’s day that needs to be considered when organising diaries and working towards deadlines. This should help to alleviate the stress of multitasking for working parents and allow the business to make the changes it needs to operate smoothly and efficiently without any miscommunication.

Other ways for a business to support childcare responsibilities may include allowing flexibility in working hours for parents, subsidising the cost of hiring a private tutor, and setting up a resource for staff to share helpful tips and resources for homeschooling. This should help working parents to not feel so isolated and alone.

Pastoral care

In these unprecedented times, employees are bound to feel more stressed, frustrated and alone. Now, more than ever, the emotional wellbeing of the workforce is paramount to the productivity and longevity of a business. Employers should foster a culture of openness and understanding, which will be genuinely appreciated by employees. At a time when staff may be running homeschooling, living thousands of miles away from family, and being unable to visit loved ones abroad, there are a number of ways in which employers can provide pastoral care.

For example, setting up a confidential helpline to receive calls from employees who are distressed and/or wish to talk with an unknown third party about anything (work related or not). Online therapists can be particularly helpful for employees who are isolating at home or working in a quarantine facility. For some employees, it may be difficult to reach out for this kind of support. It is therefore recommended that employers make all employees aware of the support around them by providing them with a card or intranet page which is easy to locate and sets out the resources available for whenever they need them.

Conclusion

Employers that identify problems and design initiatives and policies accordingly will keep their employees engaged and motivated to the business. That said, employers should also think through all of the legal and practical implications of new initiatives and policies. RPC regularly advises employers on strategic initiatives and policies in the workplace.

This article was contributed by Andrea Randall, Partner and Sakshi Buttoo, Registered Foreign Lawyer at RPC

All material contained in this article are provided for general information purposes only and should not be construed as legal, accounting, financial or tax advice or opinion on any specific facts or circumstances and should not be relied upon in that regard. RPC accepts no responsibility for any loss or damage arising directly or indirectly from action taken, or not taken, which may arise from reliance on information contained in this article. You are urged to seek legal advice concerning your own situation and any specific legal question that you may have.