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The following is issued on behalf of the Standard Working Hours Committee:
The Standard Working Hours Committee (SWHC) held its 17th meeting today (November 27).
The Chairperson of the SWHC, Dr Leong Che-hung, said after the meeting, "On the basis of the previous discussions of the SWHC, and with reference to the findings of the dedicated working hours survey as well as the public engagement and consultation on working hours, the SWHC has agreed in principle to recommend exploring a legislative approach to mandatorily require employers and employees in general to enter into written employment contracts specifying clearly such terms relating to working hours, e.g. the number of working hours, overtime work arrangements and methods of overtime compensation (i.e. the 'big frame'). Besides the 'big frame', the SWHC is also exploring the feasibility of providing further protection for grass-roots employees with lower income, lower skills and less bargaining power (i.e. the 'small frame')."
"Further to discussions at recent meetings on preliminary results of the 27 parameter combinations for exploring the 'small frame', the SWHC also received a briefing by the secretariat at the meeting today on the impact assessment results of the 28th parameter combination (i.e. monthly wages not exceeding $25,000, weekly working hours exceeding 44 hours and overtime pay rate at 1:1.5). Assessment of the 28th parameter combination was conducted as requested by the SWHC. The undertaking of the relevant analysis does not represent any pre-conceived stance of the SWHC on the direction and content of the 'small frame'."
"According to the findings of the SWHC's dedicated working hours survey, there were around 1.12 million of employees (excluding government employees and live-in domestic workers) with weekly working hours over 44 hours and monthly wages not exceeding $25,000 (i.e. the involved employees) in 2014, equivalent to 37.7 per cent of all employees in Hong Kong. Assuming the hours of work of the involved employees were to remain unchanged, and those hours above the working hours parameter of 44 per week would be compensated by overtime pay rate at 1:1.5, the income of the involved employees would improve. Their potential average increase in salary would be around 10 per cent. If working hours were shortened, it would help employees achieve better work-life balance, and reduce their potential health problems. However, if the hours of work of the involved employees were to be reduced to the working hours parameter of 44, with the same wage rates, their potential salary reduction would be around 14 per cent."
"As for the business sector, in the absence of adopting any measure to mitigate the cost increases, this additional parameter combination explored would entail an immediate increase in wage bill by around $21.6 billion. Assuming the enterprises would not adjust the hours of work of employees, and they offset half or all the increases in payroll expenses by profit reduction, estimates from stress tests showed that the number of enterprises turning from profits to losses for all sectors combined would be 7 000 and 10 000 respectively. On manpower resources, those hours of work of the involved employees above the working hours standard amounted to around 10 per cent of total labour input, translating into 304 000 full-time equivalent jobs, equivalent to almost three to four times the prevailing number of overall vacancies."
"On the macroeconomic front, under the scenario of moderate economic growth at two per cent, estimates from an econometric model showed that the increase in wage bill entailed from this newly-explored parameter combination would push up the Composite Consumer Price Index by around 4 percentage points, whilst resulting in a potential job loss of around 34 000."
"The SWHC, upon further deliberation of relevant data analysis, has agreed to take forward the work on further consultation with major employer associations, major labour organisations, relevant trades and professional bodies, etc. (i.e. the 'second-stage consultation'), so as to collect views of the community on working hours policy directions being explored by the SWHC. At the meeting today, the SWHC discussed the draft framework of the second-stage consultation and will at the future meetings discuss the content of the draft consultation document."
Dr Leong also said, "In contemplating a working hours policy, the SWHC needs to carefully consider various factors including employees' overtime work situation, as well as the possible impacts of different scenarios on employees, employers, enterprises (particularly small and medium-sized enterprises), trades, the overall economy and the labour market with a view to building community consensus and formulating appropriate and feasible working hours policy directions."
"It is regrettable that some employee members decided to leave the meeting early today without completing the discussions. I appeal to the concerned members to take part again in the work of the SWHC as soon as possible to forge common grounds and allow differences, and kick off the second-stage consultation to gauge the views of the community on working hours policy directions, thereby producing a report for the Government's consideration."
Chaired by Dr Leong Che-hung, the SWHC comprises members drawn from the labour and business sectors, academia, the community and the Government. For details, please refer to the SWHC website (www.swhc.org.hk).
Ends/Friday, November 27, 2015
Issued at HKT 22:42
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