Opening an MPF account for employees is a one-time job, making contributions for them is not. Employer will need to remit contributions for employees once every contribution period (generally the wage period). Many employers think that making contributions means making on-time payment every month. Here is what employer should observe when making contributions for their employees.
1. First time contribution
Employer is not required to arrange MPF for his employees who have not been employed for 60 days.
Technically, the first contributions should be paid to your trustee on or before the 10th day after the last day of the calendar month on which the 60th day of employment falls.
2. Contribution Holiday
Regular Employee is not required to make contributions for the first 30 days of employment and
- any incomplete payroll period that immediately follows the 30-day period (if the employee’s wage period is monthly or shorter than monthly)
- the calendar month in which the 30th day of employment falls (if the employee’s wage period is longer than monthly)
Casual Employee: Employer and employee doesn't have holiday, need to contribute from 1st day of employment.
- Employee A joined on 5 June 2019
30th day employment fall on 4 July 2019 (Contribution Holiday).
July is incomplete month so the Employee MPF for July also waived.
On August 2019, employee will get full month wage period, so first employee contribution is August and need to paid before 10 September 2019.
The setup in HReasily can be shown below:
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