The Employers' Federation of Hong Kong (EFHK) yesterday urged its member enterprises not to lay off any staff as far as possible amid the current financial crisis.

The federation has more than 500-member companies with about 500,000 staff on their payroll.

The federation expressed hope that this measure could help avoid rise in unemployment rate even though that might involve pay cut, a shorter working week or no-pay leave.

Generally, the EFHK recommends a pay rise margin to its members at the end of each year. But for the first time since 1983, it hasn't done so this year. "It is very difficult to recommend a pay rise margin at this time of the financial tsunami," chief executive officer Louis Pong told a press conference.

Pong also added that the federation was not optimistic about the economic condition in 2009.

"A great many sectors are affected by the financial tsunami. The worst unemployment scenario has yet to occur but we are afraid that it will happen after the Chinese New Year holidays," Pong added.

Even when it is absolutely necessary for enterprises to lay off staff, the exercise should be carried out in one go, and employers should also communicate with the employees lest they worry about a second or third wave to follow.

However, he said it is up to enterprises to decide if senior staff should accept pay cuts to set an example for the rest to follow, and if profit-making enterprises should lay off employees.

Regretting the federation's stand, Unionist lawmaker Wong Kwok-hing said: "They should not make such an across-the-board statement to tell all companies, including the profit-making ones, not to increase salaries because some companies only use the financial tsunami as an excuse to lay off staff."

"In fact, the profit-making companies should award pay rise to its staff," he added.

(HK Edition 12/04/2008 page1)