This article explains how Mandatory Provident Fund (MPF) contributions are calculated in JustLogin, covering the 60-day new joiner rule and the flexible contribution rate configuration available to employers.
Part 1: MPF Calculation for New Joiners
MPF contributions for new employees only take effect after 60 calendar days from their joined date.
Example 1: Employee Joining Mid-Month
- Employee A joined the company on the 5th of June.
- Within the first 60 days from the joined date, there will be no MPF contributions deducted from the employee.
- After 60 calendar days, the contribution start date falls on 3rd of August. The first contribution payment is therefore due on the 10th of September.
- The Employer must contribute from the first day of employment and must remit payment before the 10th of September.
- The Employer MPF will only appear on the payslip on the 60th day of the employee's employment.
- Payruns must be processed in sequential monthly order — for example, process the June payrun first, then July, then August, and so on.
Example 2: Employee Joining on the 1st of the Month
- Employee Blue's joined date is the 1st of June.
- Employee MPF will not be deducted in the first month. However, Employer MPF begins accruing from the joined date — it will not be shown on the payslip in this period.
- In the second month, both Employee and Employer MPF will be calculated and displayed on the payslip. The Employer MPF shown will include the previous month's contribution as well.
YTD is calculated as $300 (June) + $300 (July) = $600
Succeeding months will display and calculate both Employee and Employer MPF in the standard way.
Important: Employees with Foreigner or Expatriate status who stay in Hong Kong for less than 13 months are not required to contribute to MPF. |
Part 2: Flexible MPF Contribution Rate
In Hong Kong, the standard MPF contribution rate is 5% for both the employer and employee, subject to a statutory maximum contribution cap. Some companies may offer different contribution structures based on internal policies or contractual obligations. JustLogin supports flexible configuration of MPF contribution rates and ceilings to accommodate these arrangements.
What Can Be Configured?
With this setup, you have full control over how MPF contributions are calculated. The following options are supported:
- Custom contribution rates: Choose any rate between 5% and 15% for both employer and employee. These rates can be set independently of each other.
- Contribution ceilings: A ceiling amount can be applied to cap the maximum contribution. Setting the ceiling to "0" means no cap will be enforced.
- Automated payslip reflection: Contribution amounts based on the configured rates and ceilings are automatically calculated and displayed on the employee's payslip during payroll processing.
How the Calculation Works
The following example illustrates how the system calculates contributions when custom rates and a ceiling are configured.
| Setting | Value |
|---|---|
| Employee's Basic Pay | $10,000 |
| Contribution Rate | 10% |
| Contribution Ceiling (set in system) | $900 |
| Scenario | Employer MPF | Employee MPF |
|---|---|---|
| Without ceiling applied | 10% of $10,000 = $1,000 | 10% of $10,000 = $1,000 |
| With $900 ceiling applied | $900 | $900 |
These values are automatically populated in the MPF section of the employee's payslip.
Bulk Update Option
For companies with a large number of employees, the system provides a bulk import function to update MPF rates and ceilings across multiple employees simultaneously. This eliminates manual data entry and makes it easy to roll out contribution changes efficiently.