What employers should review
The Employment (Amendment) Ordinance 2025 was passed by the Legislative Council on 18 June 2025 and gazetted on 27 June 2025. The new continuous contract rules apply from 18 January 2026.
The reform replaces the long-standing 418 test with an aggregate threshold commonly called 468: four weeks with a combined total of at least 68 working hours. More part-time and casual employees are expected to qualify for statutory employment benefits as a result.
Employees on a continuous contract are entitled to statutory benefits under the Employment Ordinance, including statutory holiday pay, paid annual leave, sickness allowance, and eligibility for severance payment and long service payment.
Our perspective
The change is best treated as a workforce planning issue, not just a payroll update. Employers that rely heavily on part-time and casual staffing should model the cost impact early, while the added protection may also make flexible roles more attractive to candidates in a tight labour market.
Our advice to HR partners
HR teams should identify which current staff may newly qualify as continuous contract employees, quantify the additional leave and payment entitlements, and align finance, payroll and operations before questions arise from staff or the Labour Department.
What has actually changed
Under the previous 418 rule, an employee had to work at least 18 hours in each of four consecutive weeks for the same employer to be on a continuous contract. From 18 January 2026, an employee who works an aggregate of 68 hours or more over a four-week period qualifies, with a 17-hours-per-week test applying in the first three weeks of new employment. The change has no retroactive effect.
Because the new test aggregates hours across four weeks, employers need reliable working-hour records for every part-time and casual employee, and clear separation between employment periods before and after 18 January 2026, which remain governed by the old rules.
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