Labour contract | Holidays | Rescission of contract​ | Notes for non-resident employees | Labour legislation enquiry hotline

Labour contract

 What are the types of a labour contract?

A labour contract can be of two types: indefinite contract and term contract.  Term contract may have a fixed term or a variable term.
 
An indefinite contract does not specify any employment period; in other words, it is a permanent employment.
 
A term contract sets an employment period or a period required to complete the object of the contract.  For example, if the duration of a contract is set for a specific length, such as one year, the contract is a fixed term contract; if a contract ends after the task is completed, it is a variable term contract.  (Only under the circumstances prescribed by law could the employer conclude a term contract with a resident employee.)
 
*For samples of labour contract, please see Labour Relations Law – Samples of Written Documents.

 If a contract is renewed annually, is it a term contract?

A term contract, in addition to meet the legal requirements of term contract, must be concluded in writing with the grounds justifying the term agreed upon by an employer and an employee.  Moreover, it shall only be entered into to satisfy temporary needs of an enterprise, for instance, starting a new task for an uncertain period, undertaking construction works or public works, performing seasonal work or replacing an absent employee.
 
If a contract does not fulfil the legal requirements for term contract, even though it is renewed each year with a fixed period, it is still considered as indefinite contract instead of term contract.
 
A fixed-term contract which satisfies the requirements for conclusion cannot be renewed more than twice and shall not exceed 2 years, including renewals, otherwise, it will be converted into an indefinite contract.

 What are the differences between indefinite contract and term contract?

There are two main differences: 1) an indefinite contract may be made in oral or written form, whereas a term contract must be concluded in writing and its conclusion must meet the legal requirements; 2) for an indefinite contract, unless there are valid grounds, if an employee is dismissed by his employer, the employee shall be entitled to compensation calculated according to his length of service; however, for a term contract, since an agreed period or a period needed for an agreed task is specified in the contract, when the contract is terminated due to its expiry or completion of the agreed task, the contract becomes invalid, thus no compensation is required.
 
Regarding the probationary period, for general workers, the probationary period is 30 days for a term contract and 90 days for an indefinite contract.
 
However, during the labour relation, whether an indefinite contract or a term contract is concluded, an employer and an employee are entitled to the same rights and obligations under the Labour Relations Law including working time, weekly rest days, mandatory holidays, annual leave, justified absences, maternity leave, paternity leave, form of payment of remuneration, pay slip, employment record, etc.

 What contracts must be concluded in writing?

• Fixed term labour contract (including renewal);
• Variable term labour contract;
• Labour contract concluded with a non-resident worker;
• Labour contract concluded with a minor worker.

A written labour contract must contain: identification and signatures of the employer and the employee, working conditions, the date when the contract is entered into, the date when the contract comes into force, and other requirements stipulated by law.  Each party shall have a copy of the written labour contract.
 
If it is a term contract (including fixed term contract or variable term contract), the grounds justifying the term agreed upon by the employer and the employee must also be stated.

Holidays

 There are 10 mandatory holidays in Macao:

• New Year's Day (January 1)
• Lunar New Year (the first, second and third day of the first month of the Lunar Year)
• Cheng Ming Festival
• Labour Day (May 1)
• The day after the Mid-Autumn Festival (Chong Chao Festival)
• National Day of the People's Republic of China (October 1)
• Chong Yeong Festival
• Macao Special Administrative Region Establishment Day (December 20)

 What are the rules when a mandatory holiday falls on a weekly rest day?

In the case where a mandatory holiday falls on a weekly rest day, the current law stipulates that the overlapping holiday shall be handled in accordance with the mandatory holiday; the employer is required to arrange for the employee to take the overlapping weekly rest within the following thirty days.

In a situation where employees take a day off in the above circumstances, if they are paid monthly, they shall not be entitled to additional remuneration since their monthly remuneration includes the remuneration for weekly rest days and mandatory holidays; if they are paid daily, hourly, or by piece, they shall be entitled to the additional remuneration for that day since their remuneration only includes the remuneration for weekly rest days; if they receive a remuneration comprising the above types of remuneration at the same time, no additional remuneration is required for the part of monthly remuneration, but the additional remuneration for the part of daily remuneration, hourly remuneration, or remuneration by piece shall be calculated according to subparagraphs 2) and 3) of paragraph 1 of Article 61 of the Labour Relations Law.
 
If employees provide work in the above circumstances, employers are required to compensate the employees with the compensation for providing work on mandatory holidays and are also required to arrange for the employees to take the overlapping weekly rest within the following thirty days.

 Does the work remuneration include the remuneration for weekly rest days, mandatory holidays, annual leave and absence due to sickness or accidents?

For employees who are paid monthly, their monthly remuneration includes the remuneration for weekly rest days, mandatory holidays, annual leave and absence due to sickness or accidents (6 days per calendar year), so employers are not required to pay additional remuneration to such employees.
 
For employees who receive daily remuneration, hourly remuneration, remuneration by piece, or commissions, their remuneration only includes the remuneration for weekly rest days, but not include the remuneration for mandatory holidays, annual leave and absence due to sickness or accidents (6 days per calendar year); the employer is obliged to pay the employee the remuneration corresponding to the number of days.
       
For employees who receive the remuneration comprising the above types of remuneration at the same time, the remuneration of mandatory holidays, annual leave and absence due to sickness or accidents shall be calculated separately.  In other words, no additional remuneration is required for the part of monthly remuneration, but the additional remuneration for the part of daily remuneration, hourly remuneration, remuneration by piece, or commissions shall be calculated according to subparagraphs 2) and 3) of paragraph 1 of Article 61 of the Labour Relations Law.

Rescission of contract​

 Can an employer and an employee agree on previous notice for terminating a labour contract?

During the probationary period, an employer and an employee can have a written agreement on previous notice; however, it is invalid if it is made in verbal form. Please be reminded that the length of previous notice agreed upon by both parties shall not exceed the length of the statutory period (i.e. 15 days in case of termination on initiative of an employer and 7 days in case of termination on initiative of an employee).
 
After the probationary period, an employer and an employee can agree about the same or different length of previous notice; however, please note that the length of previous notice suggested by the employee shall not exceed that suggested by the employer.
 
For example: if an employer and an employee agree on 30 days as previous notice in case of termination on initiative of the employee and 20 days on initiative of the employer, then such agreement is invalid due to breach of the law; if the labour contract is terminated, the employer must give 15 days of previous notice as stipulated in the law whereas the employee must give 7 days of previous notice.
 
In the absence of contractual provisions on the length of previous notice, the length of previous notice required to terminate a labour contract shall be: 15 days in case of termination on initiative of an employer and 7 days on initiative of an employee.

 Can an employer or an employee terminate a labour contract with just cause?

When any fact or serious circumstance makes it impossible to continue a labour relation, either an employer or an employee can terminate the labour contract with just cause based on that.
 
When terminating the labour contract with just cause, neither the employer nor the employee is obliged to comply with the statutory or agreed previous notice. In case of termination with just cause on initiative of the employer, the employee has no right to compensation; however, in case of termination with just cause on the employee's initiative, the employer is obliged to compensate the employee.
 
Although no previous notice is required, the party who takes initiative to terminate a labour contract must give the other party written notice of the decision of termination with just cause within 30 days after knowledge of the relevant fact, summarily describing the facts that led the party to think it is impossible to continue the labour relation. If written notice is not given or not given within 30 days, the ground put forward by the party may be considered unreasonable.
 
If written notice is not given or not given within 30 days, or the ground put forward by the party is considered inadequate after investigation, the following legal consequences will arise: if an employer dismisses an employee, the employee shall be entitled to compensation equivalent to twice the amount of statutory compensation; if an employee terminates a labour contract, the employee is demanded to reimburse the employer an amount equal to the number of days lacking in the previous notice.
 
*For samples of notice of rescission of contract with just cause, please see Labour Relations Law – Samples of Written Documents.

 Can a female employee be dismissed during pregnancy or within 3 months after confinement?

An employer is prohibited from dismissing a female employee during pregnancy or within 3 months after confinement without just cause; otherwise the employer shall be liable to pay the fired female employee a compensation corresponding to 56 days of basic remuneration, without prejudice to any other compensation owed to her, such as dismissal compensation.
 
A female employee shall be entitled to a compensation corresponding to 56 days of basic remuneration only after having given her employer notice of her pregnancy or confinement.

 Can an employer dismiss an employee who is absent due to work-related accident?

An employer is prohibited from dismissing an employee who is absent due to work-related accident, except with just cause; otherwise the employer shall be liable to pay the fired employee a compensation equivalent to 3 months of basic remuneration and that compensation must not be lower than MOP$10,000.00. Meanwhile, the employer is also required to pay other compensations owed to the fired employee, such as dismissal compensation.

Notes for non-resident employees

Non-resident employees working in Macao are entitled to the rights and protections stated in the Labour Relations Law and the Law for the Employment of Non-resident Workers.  Moreover, they have to comply with the legal obligations.
 
 Basic rights:

• The right to holiday: 1 day of weekly rest day per week, 10 days of mandatory holidays and a minimum of 6 working days of annual leave after one year of service
• Extra compensation for work performed on weekly rest days and mandatory holidays and the overtime work performed
• Justified absences: Marriage/paternity/death of spouse, parents, son or daughter/sickness or injury caused by accident, etc.
• Compensation for loss or injuries resulting from work-related accidents or occupational diseases
• Female employee's right to maternity leave

 Special rights:

• Free lodgings or a monthly housing allowance of MOP$500.00 at least
• The cost of transportation to the employee's place of habitual residence upon cessation of the labour relations

 Working legally:

Only after a non-resident employee has been granted the “Authorization to Stay for Non-resident Workers” issued by the Public Security Police Force could he/she legally work in Macao.  Moreover, he/she could only work according to the position stated in the “Non-resident Worker's Identification Card.”
 
 Written contract:

The employer is obliged to conclude a written contract with each employee and the employee is entitled to get one copy.

• Content of contract

• The contract shall be subject to a definite term

 Remuneration:

• The monthly remuneration cannot be less than the amount stated in the employment permit granted to the employer and should be paid by Macao Pataca.
• The monthly remuneration must be carried out through a deposit to a current account owned by the non-resident employee at a banking institution in Macao.

 Legal obligations:

• The employee must notify the employer or the employer's representatives within 24 hours after a work-related accident occurred.
• In the case of absence for sickness, the employee must inform the employer of it and submit a medical certificate.
• The employee must notify the employer of her pregnancy or confinement and submit the medical certificate of confinement.
• If the employee wants to resign before the expiry of the term of the contract, he/she must notify the employer of it in advance (in the absence of agreement, the notification should be made 7 days in advance).  

 Others:

• If the employee resigns before the expiry of the term of the contract, he/she won't be granted a new work permit within 6 months, except for the resignation with just cause.
• “Illegal worker” or “a non-resident employee working for a non-authorized entity” is deemed an administrative offence and a fine of MOP$5,000.00 to MOP$10,000.00 shall be imposed.

 Hotlines for reporting illegal work:

Public Security Police Force: 2857 3333
Labour Affairs Bureau: 2833 8808       Fax: 2855 0477
Customs Service: 2855 9944

Labour legislation enquiry hotline

For enquiries, please call the labour legistation enquiry hotline 2871 7810.