The Chinese Lunar New Year poses difficulties for international companies

Posted on 16 February 2018 by IRIS FMP

Today (Friday 16th February) marks the start of the Chinese Lunar New Year. Across East Asia many employees will have this time as holiday, and the nature of this varies from country to country.  These discrepancies can make payroll for this period confusing, particularly if your company is based elsewhere but employs people across the region. Do you know exactly who is entitled to what time off, and how they must be paid?

In China, February 15th – 21st are paid holidays. If your employees have to work during this time then they must receive triple pay.

In Hong Kong, February 16th – 19th is the Lunar New Year holiday period; if your staff there are required to work during these days then they must have an alternative holiday day within the next 60 days.

In Indonesia it gets particularly complicated. Some employees are entitled to overtime pay on February 16th. Overtime work by staff who work a six day week during Indonesia’s statutory holidays must be compensated with double pay for the first five hours they work, triple for the sixth hours and quadruple for the seventh and eight hours.

In Malaysia the holiday period is February 16th – February 17th. Some workers receive double pay during this time, some receive triple.

In Singapore the Lunar New Year is celebrated from February 16th – 17th. If the employee would have a standard rest day on the 17th (as it is a Saturday) then they will get their holiday on the next working day. If they must work during the holiday period then workers receive double pay, or sometimes compensatory time off work.

In Taiwan the public holiday is February 16th and those who must work receive double pay. Customarily in this country, employees receive a Chinese New Year bonus payment.

In Vietnam the Lunar New Year holiday, also called the Tet Holiday, is from February 14th – 20th and those who must work receive triple pay. Staff receive a Tet Bonus before their time off and the amount varies based on the company and the individual employee’s performance.

In the Philippines, February 14th is an unpaid holiday.

So, despite being one holiday, the Lunar New Year is marked very differently across East Asia, and even varies between companies in the same country. Do you feel confident that you have the required level of targeted knowledge about each country’s customs to get payroll 100% correct during this time?

Coordinating payroll is hard enough from your own country, let alone if you place staff elsewhere. But luckily there are international payroll services out there that can support your company, regardless of the legislation, customs, holidays or languages. Don’t sit there worrying about when the next holiday comes around; get peace of mind and know all of your staff are supported.

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Giving an overview of the complexities facing organisations in one or more overseas locations