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ADW Formula:
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The Average Daily Wage (ADW) is a calculation used in Hong Kong to determine statutory entitlements such as severance payments, long service payments, and other employment-related benefits. It represents the average earnings per day over a specified period.
The calculator uses the ADW formula:
Where:
Explanation: The formula calculates the average wage per day by dividing total wages by the number of days worked or in the reference period.
Details: Accurate ADW calculation is essential for determining statutory entitlements under Hong Kong employment laws, including termination benefits, holiday pay, and other employment-related calculations required by the Employment Ordinance.
Tips: Enter total wages in HKD and the number of days in the calculation period. Ensure both values are positive numbers (wages > 0, days ≥ 1).
Q1: What constitutes "wages" for ADW calculation?
A: Wages include all remuneration, earnings, allowances, and other monetary payments payable to an employee for work done, but exclude certain discretionary payments.
Q2: What period should be used for calculation?
A: Typically, the 12-month period preceding the relevant date, or the actual period of employment if less than 12 months, as specified in the Employment Ordinance.
Q3: Are there any exclusions from wages?
A: Yes, certain payments such as gratuities payable at discretion, travel allowances, and retirement scheme contributions may be excluded.
Q4: How is ADW used in statutory calculations?
A: ADW is used to calculate severance pay, long service pay, holiday pay, and other statutory entitlements under Hong Kong employment law.
Q5: What if employment period includes unpaid leave?
A: Unpaid leave days are typically excluded from the calculation period, and only days for which wages were payable should be included.