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Following is a question by the Hon Cheung Man-kwong and a reply by the Secretary for the Civil Service, Mr Joseph W P Wong, in the Legislative Council today (November 15):
Question:
Since December 1998, all employment contracts signed between the Government and its contract staff have stipulated that the amount of end-of-contract gratuity payable to the staff member upon completion of the contract shall be reduced by the Mandatory Provident Fund Scheme contributions the Government has made in respect of the staff member during the contract period. A considerable number of public-funded organisations have followed suit. In this connection, will the Government inform this Council:
(a) of the current number of people bound by such terms among the contract staff of all government secondary and primary schools; whether these employees may refuse to accept such terms;
(b) whether it knows the number of contract staff bound by such terms in each of the public-funded tertiary institutions and other organisations; and
(c) as the Mandatory Provident Fund Schemes Ordinance stipulates that employers shall, "from the employer's own funds, contribute to the relevant registered scheme", of the justifications for its opinion that such terms of employment do not violates the stipulation?
Reply:
Madam President:
When engaging staff on agreement terms, the Government will consider whether, in addition to the salary of the substantive office, an end-of-contract gratuity should be offered and if so, the level of the contract gratuity, having regard to factors such as the market situation, the competitiveness of the terms of employment, and the lack of retirement benefits. The end-of-contract gratuity therefore reflects an element of retirement benefits.
In anticipation of the implementation of the Mandatory Provident Fund (MPF) system, the Government has since mid December 1998 introduced in all new contracts and renewals suitable arrangements for the provision of end-of-contract gratuity. The relevant provision stipulates that the contract gratuity payable to the staff plus the MPF contributions made by the Government in respect of the staff would equal to a specified percentage of the total basic salary of the substantive office drawn during the contract period.
End-of-contract gratuity is payable on satisfactory completion of the contract. The Government will make the gratuity payment and the MPF contributions in accordance with the provisions in the relevant contract and from Government funds. There is no question of the Government infringing the stipulations in the Mandatory Provident Fund Schemes Ordinance (MPFSO).
As regards other gratuity-bearing contracts entered into before December 1998 and which are still in effect, the Government will make the MPF contributions for the staff in question in accordance with the MPFSO. The Government will also pay the staff in question the end-of-contract gratuity at the rate specified in the contract. Apart from these, the Government will also make the mandatory MPF contributions for the short term or part-time staff who are not employed on gratuity-bearing terms.
The above sets out the arrangements for staff on contract terms which the Government has made in anticipation of the implementation of the MPF system. In the following is my response to the three specific questions:
(a) Currently there are 369 teaching and non-teaching staff in Government secondary and primary schools whose employment contracts contain the above-mentioned provision on end-of-contract gratuity. They have a contractual obligation to comply with all the terms specified in the appointment letter and the contract.
(b) A total of 3,829 teaching and non-teaching staff in the eight government-funded tertiary institutions are subject to the new arrangements on the provision of end-of-contract gratuity. These institutions include the University of Hong Kong, the Chinese University of Hong Kong, the Hong Kong University of Science and Technology, the Hong Kong Polytechnic University, Hong Kong Baptist University, City University of Hong Kong, Lingnan University and the Hong Kong Institute of Education.
According to the information we have collated, we understand that there are 5,057 employees in the following statutory bodies who are engaged under contracts containing the new provision on end-of-contract gratuity:
* Hospital Authority
* ICAC
* Hong Kong Housing Authority
* Hong Kong Housing Society
* Vocational Training Council
* LegCo Secretariat
* Hong Kong Trade Development Council
* Hong Kong Academy for Performing Arts
* Equal Opportunities Commission
* Hong Kong Tourist Association
* Hong Kong Sports Development Board
* Office of the Privacy Commissioner for Personal Data
* Office of The Ombudsman
* Consumer Council
* Hong Kong Productivity Council
As regards other non-government organisations subvented by government funds, we have no information on their employee contracts.
(c) As an employer, the Government will make for its staff in each contributing period the mandatory MPF contributions from government funds. This complies with the provision in Section 7A of the MPFSO. On satisfactory completion of the contract, the Government will also pay the staff the end-of-contract gratuity in accordance with the provision in the relevant contract. The Administration has consulted its legal advisor and the Mandatory Provident Fund Schemes Authority on the new arrangements for provision of contract gratuity. The arrangements are not in conflict with the requirements of the MPFSO.
End/Wednesday, November 15, 2000
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