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Minimum wage legislation for all sectors
By Joseph Li (HK Edition)
Updated: 2008-10-16 07:34


The policy address by Chief Executive Donald Tsang is broadcast live on a giant TV screen at Times Square yesterday. CNS

Chief Executive Donald Tsang announced that the government would proceed to legislate for minimum wage in response to the labor sector's strong expectation.

Instead of a law that covers cleaning workers and security guards only, it will be a law applicable to all sectors and the government will introduce a bill in the Legislative Council within this legislative year.

The labor sector welcomed a statutory minimum wage. However, some employers worried that low-skilled workers might lose their jobs if the employers chose not to pay the minimum wage and fire them, while academics said a minimum wage would not necessarily protect the workers.

In the Policy Address, Tsang frankly admitted that the result of the voluntary Wage Protection Movement launched in October 2006 for the protection of cleaning workers and security guards was unsatisfactory although the number of workers benefiting from the movement has increased over the past two years. He also agreed with the business and labor communities that the legislation should be universal because cleaning workers and security guards are not the only low-paid jobs.

As to the wage level, Tsang said an advisory Minimum Wage Commission will be set up to formulate the minimum wage levels and review the mechanism. Members of the commission will comprise employer and employee representatives, government officials and academics. The Labour and Welfare Bureau will go ahead with the preparatory work of the Minimum Wage Commission immediately.

Legislator Wong Kwok-kin, who is also chairman of the Hong Kong Federation of Trade Unions, welcomed the move toward writing minimum wage into law and hoped it would be given a smooth ride through the legislature. But he said the policy address lacked concrete measures to combat poverty and unemployment.

Fellow legislator and Labour Advisory Board member Ip Wai-ming insisted on fixing the wage level at HK$33 per hour, which is slightly over what welfare recipients get so that the workers could earn a decent living. He also hoped the Minimum Wage Commission would communicate with the Labour Advisory Board on this subject.

But the pro-business former Liberal Party legislators had reservation about the minimum wage, fearing that it would not really protect the workers. "We have seen examples in foreign countries, where the minimum wage became the maximum wage for the workers," said Andrew Leung, who represents the Federation of Hong Kong Industries in the Legislative Council. He is also concerned that employers would fire the workers when they could not meet the statutory minimum wage and would therefore aggravate unemployment.

Jeffrey Lam, the Hong Kong General Chamber of Commerce's LegCo representative, said the minimum wage could impose a heavier financial burden on small- and medium-sized enterprises.

In the opinion of Francis Lui, an economics professor at the Hong Kong University of Science and Technology, a minimum wage would not protect low-skilled workers but would rather make them lose their jobs because employers would only retain competent workers. Wong Hung, an assistant professor on social work at the Chinese University of Hong Kong, said it is very difficult to devise a standard minimum wage for all sectors.

He called on employers and employees to discuss the wage level in a rational manner.

(HK Edition 10/16/2008 page2)