Updating Hong Kong’s statutory minimum wage mechanism

At a glance

• The Hong Kong government has updated the statutory minimum wage (SMW) review mechanism for the first time in 13 years, based on a January 2023 study.
• Changes include annual reviews of the SMW rate, a new adjustment formula, and a review of the mechanism 5-10 years after implementation.
• The new formula considers inflation (to keep SMW above the Consumer Price Index A) and economic growth (to allow SMW increases above inflation when the economy is strong).
• The formula ensures SMW will not decrease; if it calculates a negative number, the rate will be frozen.
• The first SMW rate using the new formula will be effective from 1 May 2026, and employers should update payroll systems to ensure that, going forward, SMW rate changes can be captured promptly.