Essential Considerations When Hiring New Employees

For many employers, the key to having a productive and high-performing workforce is recruiting the right people to start with. However, it is important for employers to be aware that even before an employee commences work, there are a number of legal issues which arise in the process of seeking, interviewing and selecting candidates for a position.

Q1: What issues must an employer have in mind when posting a recruitment advertisement?

In addition to ensuring that a recruitment advertisement contains sufficient information regarding the role and skill requirements for the job to ensure that the right candidates are attracted, there are also some important legal considerations for the employer to have in mind.

Typically, recruitment advertisements require a candidate to submit personal data either via a CV or application form.  This amounts to the collection of personal data by the employer.  The Privacy Commissioner has issued a ‘Code of Practice on Human Resource Management’ (the “Code”) that provides detailed practical guidance as to the correct handling of such personal data.

The Code emphasises that where a recruitment advertisement requires a candidate to submit personal data, the advertisement must include or clearly reference the employer’s ‘personal information collection statement’ (“PICS”) that sets out among other things how such data will be handled, retained and stored by the employer.

“Blind” recruitment advertisements that solicit a candidate to provide personal data without identifying the employer or employment agency are prohibited.

An employer should also ensure that a recruitment advertisement avoids discriminatory biases that may be unlawful under Hong Kong’s anti-discrimination legislation.  Employers are encouraged to use various advertising channels so as not to exclude, for example, a particular gender or ethnic minority.  Where reasonably practical recruitment adverts should be in both Chinese and English languages.

The Equal Opportunities Commission has published a booklet Equal Opportunities in Employment: Good Management Practices (the “Booklet”) which sets out further considerations when drafting and posting recruitment advertisements.

Q2: Are there any considerations that an employer must bear in mind during the interview process?

Employers must be careful to avoid making any comments or asking questions that would suggesting discriminatory bias.  Questions regarding a candidate’s martial or family status, ethnicity or national origin should be avoided.  Questions relating to a candidate’s health status must be handled carefully and relate only to whether the candidate is able to perform the genuine occupational requirements of the job, bearing in mind the requirement to allow for reasonable adjustments for candidates with disabilities to help overcome any practical difficulties.

It is advisable for consistent criteria to be applied to all candidates that relate to education, experience, knowledge, skills and ability.  It is advisable for such criteria to be provided to the interviewer in advance (perhaps as part of an interview script) for the purpose of ensuring compliance.

Q3: What is the best way to confirm an offer of employment to a successful candidate?

Candidates are often informed that they have been successful orally, either directly by the employer or via a recruitment consultant.  Thereafter, the successful candidate will usually want to have the terms of their new employment confirmed in writing.  This is usually done via an offer letter or by issuing a formal employment contract to the future hire.

While offer letters are not necessary, and are often overlooked in preference of issuing a formal employment contract, in certain circumstances offer letters can prove very useful.  Issuing an offer letter is advisable where core terms of the contract are to be negotiated.  This usually arises where the employee is offered a complex package that might include commissions / bonus buy-outs or relocation, housing, travel and educational benefits.  It is usually best for such core terms to be agreed in writing, prior to the more lengthy and complex employment agreement being issued.

Q4: Are there any terms that must be included in an employment contract?

There is no requirement for an employment contract to be in writing, but for obvious reasons, including the protection of both the employer and employee, a written agreement is always preferable.

The Employment Ordinance only requires employers to provide the following limited information to employees prior to the commencement of employment:

• Wages and wage period
• Length of notice to terminate employment
• Whether an end of year payment will be made or not

While the terms required by statute are few, it is advisable for the employment contract to also (directly or indirectly via reference) include the following terms and conditions:

• Initial job title, duties and reporting line
• Probationary periods
• Holiday, annual leave and sickness absence arrangements
• MPF and other benefits
• Business protection, including use of information and confidentiality, intellectual property and post-termination restrictions.
• Garden leave and obligations on termination

Q5: What other considerations should an employer have in mind before recruiting a candidate?

Employers should be aware of any post-termination restrictions that may affect the ability to onboard a new employee at a particular time or the ability to perform the role expected of them.  In particular, employers should be aware that if a former employee takes enforcement action with reference to post-termination obligations the new employer will likely be joined as a dependant to that action.

Connected with this, employer should absolutely ensure that they do not encourage a new employee to take confidential or proprietary information from their former employer or allow a new employee to upload such information into their IT systems.

Employers should also be aware of the new employee’s right to work in Hong Kong.  If an employment visa is required, this should be applied for at least 6- 8 weeks in advance and the new employee should not be allowed to commence employment in Hong Kong until the visa is in place.