Long Service/Severance Payment Report (before the transition date)

Long Service/Severance Payment Report is under Master ⇒ Master Reports.

This report is for reporting the long service/severance payment liable to the employer before the transition date (2025/05/01). Starting from this date, employers can no longer use the accrued benefits derived from their mandatory MPF contributions to offset an employee’s LSP/SP.

The calculation of LSP/SP is a rough estimation for regular pay employees. Due to the complicity of LSP/SP for different types of employees, users should use the data for reference only.

Reference: A Concise Guide to the Employment Ordinance Chapter 11: Severance Payment and Long Service Payment (PDF) 

Join Date is Group Join Date if Group Join Date defined, otherwise, use Join Date

Last Salary

Last Salary is the sum of the full pay wage items (No Pay Deduction, Sickness Allowance, Maternity/Paternity Allowance must count as full pay wages) of the last complete service month.

For monthly-rated employee, for example, monthly salary is $30,000, the employee took 2 day AL, 3 day SL & 1 day no pay leave. Then the wages of November is

In this case, the wages of last month for LSP/SP. SL & no pay leave should use the full pay wages, then the 3 SL day wages is $1000 x 3 and no pay leave cannot deduct the wages. Final wages is (Salary + AL Pay + full pay wages of SL) = $25000 + 2260 + 3000 = $30260.

For daily-rated employees, the last salary is the 18 days wages of the last complete service month. 

Last Eligible Salary is considered the maximum of $22500.

LSP Amount = Last Eligible Salary x 2 / 3 x Years of Service (for Months of Service >= 60)

SP Amount = Last Eligible Salary x 2 / 3 x Years of Service (for Months of Service >= 24)

Last 12 Months Average Salary

Last 12 Months Average Regarded Salary is the Average Monthly Wage for the past 12 months regarded wage.

Last 12 Months Average Eligible Salary is considered the maximum of $22500.

LSP Amount for Average Eligible Salary = Last 12 Months Average Eligible Salary x 2 / 3 x Years of Service (for Months of Service >= 60)

SP Amount for Average Eligible Salary = Last 12 Months Average Eligible Salary x 2 / 3 x Years of Service (for Months of Service >= 24)

You can input the LSP/SP amount into the standard Pay Type Long Service Payment/Severance Payment in the final payment of the employee payroll batch if the pay type Long Service Payment/Severance Payment in Payroll Module Setup, Pay Type tab is checked visible after verification.


Report Columns

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