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COVID-19 Anti-Epidemic Fund: Second Tranche of Employment Support Scheme Announced 

by Authors

Published: August, 2020

Submission: August, 2020


On 8 April 2020, the Government rolled out the first tranche of the Employment Support Scheme (ESS) for subsidising wages of employees (see our client alerts dated 14 and 20 May 2020 for details of the ESS and its implementation). The Government has just announced details of the second tranche of the ESS covering September to November 2020, which are summarised below.


Same as the first tranche, but self-employed persons who received the one-off lump-sum subsidy of HK$7,500 in the first tranche cannot apply in the second tranche.


Same as the first tranche, but employers who have applied in the first tranche can choose a different specified month for the second tranche.

Wage subsidy for employees aged over 65 or above with MPF accounts

Where only information on the employees’ employment aged 65 or above (but not their wages or MPF contributions made by the employers) is shown on the employers’ MPF record certificate, the amount of wage subsidies will be the number of such employees engaged in the specified month times a subsidy of HK$5,000 per employee per month.Where the wage subsidy of an employee calculated based on wages or voluntary contributions (applying the same formula as that of the first tranche) is below HK$5,000 per month, employers may receive a wage subsidy of HK$5,000 for each of such employees per month.Employers must pay all the received subsidies ($5,000 x 3 months) as wages to employees aged 65 or above.


First tranche employer applicants can access the application webpage using the same application number and password. There is no need to submit MPF scheme-related information or documents again unless employers choose a specified month different from that of the first tranche. Bank account information can only be changed in special circumstances.Employers who are making a first-time application in the second tranche or have not received wage subsidies in the first tranche are required to complete and submit the online application forms and the necessary supporting documents.


Same as the first tranche, eligible employers are required to undertake and guarantee that:

  • all wage subsidies will be spent on paying wages to their employees; and

  • the number of paid employees in any one month of September to November 2020 will not be less than the total number of employees (including paid and unpaid) in March 2020.

Additional undertakings are required to be provided by the following companies:

  • Wellcome and PARKnSHOP will have to offer cash coupons or discounts to non-governmental organisations and the underprivileged in return for the wage subsidies they receive in the second tranche; and

  • Major property management firms will have to give back at least 80% of the subsidies they receive in the second tranche to owners or owners’ corporations that engage their services.


Same claw back and penalty mechanisms as the first tranche.

New penalties:

  • For employers who have received the first tranche subsidies and take part in the second tranche, the government reserves the right to reject their applications if the magnitude of redundancies made by them in June to August 2020 was substantial, and the employer fails to show its intention to employ replacement employees or re-employ the redundant employees, and/or gives no reasonable explanations for the redundancies made; and

  • For all employers who having applied under the second tranche, make redundancies in September to November 2020 after receiving the second tranche subsidies, the government reserves the right to claw back in full or in part of the second tranche subsidies if the magnitude of redundancies made is substantial, and the employer fails to show its intention to employ replacement employees or re-employ the redundant employees, and/or gives no reasonable explanations for the redundancies made.

Online applications for the second tranche by applicants (which include those who have applied for the first tranche, whether successful or not) can be made from 31 August to 13 September 2020 and will be paid in three to four weeks. For those employers who have breached their undertakings during the first subsidy period, the unspent balance of subsidies returnable and/or penalty payable will be deducted directly from the wage subsidies in the second tranche.

In light of the complexity of the ESS, employers are advised to seek professional advice if they have any concerns. Employers should also pay attention to the details and comply with the requirements of the ESS so that both employers and employees could benefit from the second tranche.


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