A New Landscape for Employee Cost Management
The abolition of the MPF offsetting mechanism, effective 1 May 2025, marks a significant shift for employers in Hong Kong. Companies and NGOs must adapt to new requirements in calculating Long Service Payment (LSP) obligations. This legislative change will influence both current-year expenses and long-term liabilities. At Valtech Valuation, we see this as the perfect opportunity to help clients expand their view from LSP-specific calculations to a holistic understanding of total workforce costs.
Why Expand Beyond LSP Valuation?
LSP valuation is a critical compliance and financial planning exercise, but it only captures one part of the total employee cost picture. By integrating salary, statutory contributions, benefits, allowances, gratuities and hidden costs such as recruitment and training, employers can gain a comprehensive understanding of their workforce cost structure.
Our Expanded Service Scope
1. All-in Employee Cost Calculation (Customised to Your Scheme)
We calculate all direct, statutory, and non-statutory costs, fully customised to your unique employee benefits payment schemes and contractual conditions. This includes salary, MPF contributions, medical, insurance, housing, transport, and special schemes such as profit-sharing or gratuities.
2. Multi-Year Employee Cost Projection (Tailored to Your Conditions)
We create 3–5 year cost forecasts, incorporating factors like workforce size, grade mix, pay progression, inflation, turnover, and legislative changes. All projections reflect your specific payment formulas, eligibility rules, and benefit entitlements.
3. Workforce Planning Advisory
We identify cost drivers, compare current and future cost structures, and recommend optimisation strategies. This may include adjusting headcount mix, reviewing benefits policies, or aligning manpower costs with ESG goals.
Our Value to You
✔ Custom-fit solutions aligned with your benefit structures and policies
✔ HKAS 19–compliant calculations, audit-ready outputs
✔ Scenario analysis to test different workforce and policy strategies
✔ Serving as a financial model for managing human resources related costs in tender or project bidding involving a large number of employees within a specific period of time
✔ Strategic recommendations for cost control and talent retention
Our Deliverables Include
- Annual All-in Employee Cost Report with integrated LSP and other long-term benefits liabilities
- Multi-Year Workforce Cost Forecasted Results in Excel format
- Legislative Change Impact Briefs tailored to your schemes
- Manpower Cost Optimisation
Valtech’s Positioning
From LSP to Total Workforce Cost Advisory – Valtech Valuation helps you understand, project, and manage your total workforce cost, tailored to your specific benefit payment schemes, eligibility rules, and contractual conditions. We ensure you can plan confidently, remain compliant, and optimise resources in a changing regulatory landscape.
About Valtech Valuation
Valtech Valuation is a professional valuation firm accredited with ISO-9001 in valuation advisory services. The firm is renowned for its expertise in advanced valuation techniques, customized valuation models, data-driven insights, and adherence to compliance and reporting standards. The firm has a solid track record in valuation advisory for listed companies, private equity, fund managers, and financial institutions. Valtech’s qualified team comprises members with PhDs, CPA (HKICPA), CFA, Chartered Valuation Surveyors of the Royal Institution of Chartered Surveyors, and valuers accredited with Business Valuation (ABV) by AICPA and CVA qualifications in Singapore. Valtech continues to expand into more markets by leveraging its valuation platform and recruiting local experts.