Helper Contract Termination in Hong Kong: How to Calculate the Final Settlement Payment

Overview

When a foreign domestic helper's contract ends — whether by employer notice, helper resignation, or contract expiry — the employer must settle all outstanding financial entitlements before the helper departs. Getting this right matters: late or short payment is a breach of the Employment Ordinance, and disputes can escalate to the Labour Tribunal.

This guide covers every component of a standard FDH termination settlement.

Step-by-Step: What to Calculate

1. Outstanding wages

Pay all wages earned up to and including the last working day. Daily rate: monthly wage × 12 ÷ 365. If the employer pays a cash food allowance (HK$1,236/month for current contracts), include that too.

2. Wages in lieu of notice

• Standard notice: Either party must give one month's written notice — or pay one month's wages instead.
• Employer terminates without notice: Employer pays one month's wages to the helper.
• Helper terminates without notice: Helper owes one month's wages to the employer; this may be deducted from the final settlement.
• Summary dismissal (serious misconduct such as fraud or wilful disobedience): The employer may dismiss without notice pay — but all other entitlements still apply.

3. Pro-rata annual leave pay

FDHs are entitled to annual leave after 12 months of continuous service:

Years of service	Annual leave
1–2 years	7 days
3 years	8 days
4 years	9 days
5 years	10 days
6 years	11 days
7 years	12 days
8 years	13 days
9+ years	14 days (maximum)

On termination:

• Unused leave from completed leave years must be paid in full.
• Current partial leave year (service 3+ months): pro-rata days = (full-year entitlement) × (days worked this year ÷ 365), paid at average daily wage.
• No entitlement if service is under 3 months.

4. Statutory holiday compensation

If any of the 14 annual statutory holidays were worked without a replacement day off being granted, compensation at the average daily wage rate is owed.

5. Severance Payment or Long Service Payment

These are usually the largest items in any settlement:

	Severance Payment (SP)	Long Service Payment (LSP)
Eligibility	24+ months of service	60+ months (5 years) of service
Trigger	Dismissal or non-renewal due to redundancy	Dismissal or non-renewal for reasons other than misconduct or redundancy
Formula	Monthly wage × 2/3 × reckonable years	Same formula
Monthly wage cap	HK$22,500	HK$22,500
Total cap	HK$390,000	HK$390,000

Redundancy examples: family relocating overseas, reducing household size, or no longer needing a helper.

Example (SP): Helper with 3 years 4 months at the MAW of HK$5,100:

• HK$5,100 × 2/3 = HK$3,400 per reckonable year
• 3 years 4 months = 3.33 reckonable years
• SP = HK$3,400 × 3.33 ≈ HK$11,333

FDHs are exempt from MPF, so the MPF offset abolition (May 2025) does not affect FDH SP/LSP calculations.

SP and LSP are statutory entitlements — any agreement to waive them is void under Section 70 of the Employment Ordinance.

6. Return passage

The employer must provide a free return ticket to the helper's place of origin, including any domestic leg of the journey. This applies regardless of who terminates and regardless of reason — including summary dismissal.

7. Daily travel and food allowance

HK$100 per day from departure in Hong Kong until arrival at the helper's home, calculated on the most direct route.

Important Notes

• Payment deadline: All final payments must be made within 7 days of the last working day.
• Immigration notification: Submit Form ID 407E to the Immigration Department within 7 days of the termination date.
• Helper's stay in HK: After termination, the helper has up to 14 days to remain in Hong Kong before departure.
• Unused sick leave: Accrued sick leave days lapse at contract end — they are not paid out on termination.
• Cannot waive statutory rights: SP and LSP cannot be reduced or waived by private agreement; any such agreement is void under Section 70 of the Employment Ordinance.

Calculate Your Settlement

Working out the numbers manually takes time — and mistakes can be costly. GMA's free termination settlement calculator walks through every component, checks SP/LSP eligibility automatically, and produces a printable receipt.

Try the FDH termination settlement calculator →

Related Resources

• Labour Department — FDH FAQ and Guide
• Standard Employment Contract (ID 407)
• Notification of Termination (ID 407E)
• Chapter 11: Severance and Long Service Payment — Labour Department