Should I hire a domestic helper who has taken out a loan or is in debt?

Why do so many domestic helpers face debt problems?

There can be many reasons why someone is in debt. Many domestic helpers are taken advantage of by their employment agencies and training centres, who charge them illegally high fees that they must work for months to repay.

Domestic helpers are economic migrants and often the sole breadwinner for their family back home. On average, domestic helpers send 50-60% of their monthly salaries to support 4-5 family members. Taking out a loan may have been the best option to support their family or to cover emergency costs, such as those from medical emergencies or hurricanes.

Should I not hire a domestic helper who has taken out a loan?

It is often hard to know for sure if a domestic helper has a debt problem. Many domestic helpers are tricked into thinking the illegal fees they are being charged are legitimate “entry” or “training” fees.

There are several valid concerns about employing a domestic helper who may be in debt. However, from a hiring perspective, an employer should focus on the potential hire’s ability to repay a loan rather than whether they have outstanding debt at the moment. If the potential hire has a well laid out plan to repay their loan, this would indicate that they are responsible and proactive, which are advantageous strengths in a candidate.

As an employer, you can reduce the likelihood of your domestic worker being indebted by hiring through a reputable and licensed employment agency that does not overcharge workers. Remember that 10% of the first month’s salary is the legal maximum that employment agencies can charge workers in Hong Kong.

What do I do if I find out that the domestic helper has debt problems?

Keep in mind that you should never feel pressured to pay off your domestic helper’s debt. Whether they have incurred debt due to unfair loan sharks or due to their own irresponsibility, they need professional help to break free of those debts and patterns.

Enrich is a Hong Kong charity which provides financial education and financial counselling for domestic helpers. Encourage your worker to meet with Enrich and to take their financial education courses.

You can read more about this issue here.