Hong Kong’s New 417/468 Rule Explained: Employer Compliance Guide for 2026

Authors: Anna Lau, Litigation Partner & Ashley Zhu, Trainee Solicitor

Hong Kong’s part-time workers and their bosses should take note: the long-standing “418 rule” for continuous employment is about to change.  

What is the 417/468 Rule in Hong Kong and What’s Changing? 

Under current law, the “418 rule”, an employee must work at least 18 hours a week for 4 consecutive weeks to be considered under a continuous contract. This status is crucial because only continuous-contract employees get key benefits like paid rest days, annual leave, sick leave, maternity/paternity leave, as well as severance and long service payments. 

The recent amendments to Hong Kong’s Employment Ordinance, commonly referred to as the 417/468 rule, lower this threshold and add flexibility to protect part-timers with irregular hours. In June 2025, Hong Kong’s Legislative Council approved amendments to the Employment Ordinance (Cap. 57) that will replace the 418 rules with a dual test: 

• 17 Hours per Week (the “417” part): An employee will qualify under a continuous contract if they work at least 17 hours each week for 4 weeks. This one-hour reduction in the weekly threshold (from 18 to 17) may seem small, but it closes to the loophole where employers could schedule someone for just under 18 hours to avoid benefits. 

• 68 Hours in 4 Weeks (the “468” part): Even if an employee falls below 17 hours in a given week, they can still be deemed continuous if their total hours over that week and the prior 3 weeks reach 68 hours or more. In other words, working an average of 17 hours across a 4-week period (68 hours aggregate) will count. This means one slow week won’t automatically break the continuity of employment as long as the overall four-week hours are sufficient. 

Together, these changes (often collectively called the “417/468 rule”) ensure that part-time, casual, and irregular-hour employees have a fairer chance of qualifying for statutory benefits. A government spokesperson noted that this added flexibility will reduce situations where “an employee’s continuity of employment is disrupted because one week’s hours fall below the threshold”.

(Press Release:  https://www.info.gov.hk/gia/general/202506/18/P2025061800282.htm) 

Who could be Affected? 

Here are some case scenarios that you might want to pay attention: 

Part-Time Employee with Variable Hours 

• Imagine an employee working for 15 hours in some weeks and 20 hours in other weeks. Under the old “4-18” rule, any week under 18 hours would break his continuous service (so he won’t be entitled to any statutory benefits). But under the new 417/468 rule, as long as his total number of working hours over a 4-week period is more than 68 hours, they are deemed continuously employed.  

  
  

Freelancers or Gig Worker 

• If a person is effectively working under your instructions on a regular basis (even if labeled as a “self-employed person/contractor”), he may be engaged as an employee under the law. If so, the new 417/468 rule could bring him into the definition of continuous employment more easily (Note: Self-employed persons/contractors are not entitled to the rights and benefits and protection offered by the Employment Ordinance, the Employee’s Compensation Ordinance and the Minimum Wage Ordinance; there is no hard and fast rules to distinguish employment from independent contractor; it’s the substance of the relationship that matters over the title). 

  
  

Implications for Employers 

This change represents a significant expansion of employee protection. By lowering the threshold and allowing an aggregate hour count, the rule will dramatically widen the pool of staff eligible for statutory benefits.  

On the positive side, this change promotes fairness and can improve staff morale and retention (workers feel more secure and valued). However, failing to comply will carry risks. If an employer doesn’t provide statutory benefits to someone who meets the new criteria, this will be in contravention of the law and lead to statutory penalties (prosecution and fines up to HK$50,000 per offence), monetary claims for any outstanding benefits by the employee (which could result in disputes at the Labour Tribunal or higher level of Courts), and even reputational damage. In short, businesses that ignore the 417/468 rule not only face legal risks but may also harm their reputation as a responsible employer. 

The new provisions are expected to come into force in January 18, 2026, after a short transition period. Until then, the old 418 rule still applies. Employers have a few months to prepare, but it’s wise to start early in adjusting policies and systems for the new criteria. 

Employer Compliance Checklist 

To get ready for the 417/468 rule, employers should take proactive steps now. Here’s a quick compliance checklist: 

1. Review Employment Contracts 

Update any contract terms that define full-time, part-time, or “continuous employment.” Ensure they reflect the new 17-hour/68-hour threshold so that you’re not inadvertently misclassifying employees. 

2. Update Payroll Systems 

Adjust your HR and payroll systems to track employee working hours on a rolling 4-week basis. 

3. Train HR Personnel 

 Equip your HR team with knowledge of the new requirements. 

4. Communicate with Employees 

Inform part-time and casual employees that the law is changing in their favor. Clear communication can reduce confusion and disputes. 

5. Seek Legal Advice 

Businesses with a large part-time workforce or complex scheduling shall consult legal experts in employment law to mitigate exposure to unnecessary legal risks. 

If you require guidance on the new 417/468 rule or the Employment Law in Hong Kong, contact Ravenscroft & Schmierer for expert legal advice tailored to your business needs. 

Frequently Asked Questions 

Disclaimer: Whilst every effort has been made to ensure the accuracy of this article it is general in nature and does not constitute legal advice of any kind. You should seek your own personal legal advice before taking legal action. We accept no liability whatsoever for loss arising out of the use or misuse of this article.

For specific advice about your situation, please contact:

Anna Lau

Litigation Partner

+852 2388 3899

alau@rs-lawyers.com.hk