In Hong Kong, employers are legally required to contribute to a retirement savings plan for their employees called the Mandatory Provident Fund (MPF). However, recent figures reveal a concerning trend: in the past year alone, the MPF Authority has issued around 400,000 payment notices for missed contributions, with many employers repeatedly violating the rules. Yet fewer than 0.1% of these cases resulted in prosecution.
The surge in default notices — up more than 6% from the previous year — has raised fears of a wave of business closures. Despite this, the Hong Kong government has not introduced new measures to address the issue, and enforcement remains weak. Just 280 prosecution summonses were issued in the same period, and penalties remained minimal, typically fines of only HK$1,000 to HK$5,000 per case.
Missed MPF Payments Foreshadowed Closures
Failure to contribute to the MPF often reflects deeper financial stress. In recent years, several well-known companies were found to have defaulted on contributions before abruptly shutting down.
In September 2023, California Fitness (Comfort Fitness) was found to have failed to contribute over HK$4.8 million to the MPF accounts of 740 employees. Days later, it closed all its branches. Similarly, Ocean Empire Food Shop, which shut down suddenly in May 2025, had been chased by the MPF Authority multiple times since mid-2023 for unpaid contributions totaling HK$570,000, showing the warning signs were present long before the closure.
Other well-known local chains — including Kam Kee Café, Taipan Bread & Cakes, and karaoke brand RedMR — have also been reported for MPF defaults. Super Star Group, which publicly denied financial trouble, was later revealed to owe HK$460,000 in MPF payments.
Maximum Penalties Rarely Imposed
Under Hong Kong law, employers who fail to make MPF contributions can face up to HK$450,000 in fines and four years’ imprisonment. But in reality, very few face serious consequences. In 2024–25, about 400,000 payment notices were issued, recovering around HK$200 million. Roughly 25% of employers paid on time, while most others complied after being contacted. Only 1,700 cases required civil action.
The MPF Authority’s 2023–24 report showed 376,000 notices issued and HK$155 million recovered — year-on-year increases of 6% and 29%, respectively. But criminal enforcement remains rare. The MPFA says it only prosecutes when there is enough evidence and the employee is willing to testify. As a result, just 280 prosecution summonses were issued, with around 180 convictions, each yielding only modest fines.
Warning Signs Ignored
MPF defaults are a clear early warning of business instability, sometimes preceding closures by months. Unlike unpaid wages, which may go unnoticed until staff speak out, MPF data is systematically collected and monitored.
Yet despite having this data, the government has failed to act. There’s been no early intervention, no policy reform, and no meaningful enforcement. As a result, the system is failing to protect workers, whose retirement security hangs in the balance.