With the abolition of the MPF offsetting mechanism effective May 1, 2025, Hong Kong employers must now prepare for significant changes in handling Long Service Payments (LSP).
To help businesses navigate these changes, we recently hosted an exclusive LSP Assessment Sharing Session at Manulife on April 28, 2025. This session empowered Manulife employees to:
- Deepen their understanding of the MPF offsetting abolition and its implications.
- Guide clients effectively in conducting accurate LSP assessments and finding tailored solutions.
What Was Covered in the LSP Assessment Sharing Session?
1. Understanding the Full Impact of MPF Offsetting Abolition
- Increased Employer Liability: Employers can no longer offset MPF contributions against LSP/SP, leading to higher termination costs.
- Financial Planning Challenges: LSP amounts will now be significantly larger (with no MPF offset), requiring accounting for liabilitie.
- Legal Compliance Risks: Missteps in LSP calculations could result in penalties or disputes.
2. Introducing Our LSP Calculator – A Game-Changer for Employers
To simplify compliance, we showcased our LSP Calculator, designed to:
✔ Automate LSP computations based on the latest legal requirements.
✔ Generate instant reports for audit teams.
✔ Model different termination scenarios for better budgeting.
Why Attendees Found This Session Invaluable
✅ Real-World Case Studies: Practical examples demonstrated how leading organizations are adapting to the new LSP regulations.
✅ Interactive Q&A: Manulife experts addressed complex LSP scenarios, providing clarity on implementation challenges.
Final Thoughts: Embracing the Change
The abolition of MPF offsetting reshapes Hong Kong’s employment landscape, demanding swift and strategic action from employers. By leveraging innovative tools like our LSP Calculator, businesses can:
- Minimize financial and legal risks.
- Streamline LSP assessments with accuracy and efficiency.
