Review of improvement measures on government service contracts shows significant rise in wages of non-skilled employees

     The Government released today (January 27) the "Report on Review of the Improvement Measures for Non-skilled Employees Engaged by Government Service Contractors (GSCs) Implemented with effect from April 1, 2019".

     The Report revealed that the median hourly wage of non-skilled employees had increased 23.8 per cent to $45.5 after the implementation of a package of improvement measures since April 2019. Even after discounting the increase in the Statutory Minimum Wage (SMW) rate and the Consumer Price Index (CPI) within the same period, there was still a significant net increase of 14.0 per cent in the employees' median hourly wage. The improvement measures adopted have clearly proven to be significant and effective in enhancing both the remuneration packages and labour protection of non-skilled employees engaged by the relevant GSCs.

     A Government spokesman said, "Using the aforesaid figures for projection, the monthly basic wage of a cleaning worker or security guard among non-skilled employees benefiting from the improvement measures, who works six days per week and eight hours per day, increased from about $9,100 to about $11,270, representing a very substantial increase of about $2,170 per month. The employee will also receive a contractual gratuity at a rate of 6 per cent of the total wages with no less than 12 months of service upon contract completion or termination."

     The spokesman added, "In her 2018 Policy Address, the Chief Executive (CE) announced a package of measures to improve the employment terms and conditions as well as labour benefits of non-skilled employees engaged by GSCs. These measures, which came into effect on April 1, 2019, included increasing the technical weighting in marking schemes for considering bids (to avoid the phenomenon of 'the lowest-priced bid wins'), adopting a contract tenure of not less than three years when operational situations permit, entitlement to a contractual gratuity, an earlier statutory holiday pay, and additional remuneration when employees are required to work when Typhoon Warning Signal No. 8 or above is in force.

     "While those improvement measures were welcomed, the CE announced in January 2020 that the Secretary for Labour and Welfare would set up an Inter-departmental Working Group to review the measures' actual impact and propose further improvement measures as needed."

     The review analysed information from government service contracts adopting the improvement measures issued and awarded from April 1, 2019, to September 30, 2020, by four main user departments, namely the Food and Environmental Hygiene Department, the Leisure and Cultural Services Department, the Housing Department and the Government Property Agency. The analysis showed that among about 25 500 non-skilled employees who have benefited from the improvement measures covered in the study, their median committed hourly wage increased from $36.7 to $45.5, a substantial rise of 23.8 per cent, after adopting the improvement measures. Even after discounting the increase in the SMW rate (8.7 per cent) and the CPI(A) (1.1 per cent) within the same period, there was still a significant net increase of 14.0 per cent.

     "The improvement measures were significant and effective in enhancing both the remuneration packages and labour protection of non-skilled employees, and naturally had increased the expenditure of user departments. Comparing the same batch of service contracts before and after adopting the improvement measures, the average increase in annual expenditure incurred amounted to more than 40 per cent, a significant proportion of which covered enhancement in the remuneration packages and the working environments of the employees concerned," the spokesman said.

     "The non-skilled employees of GSCs are an important source of human resources in the provision of public services. They have shouldered additional work pressure during the COVID-19 epidemic. Despite the economic recession and public expenditure under stress, the Working Group considered it justified to retain the improvement measures. A few additional measures were recommended," the spokesman added.

     The three recommended improvement measures are requiring GSCs to provide uniforms with dry-fit properties for non-skilled employees engaged in outdoor work in summer, introducing measures on preventing heat stroke in the tender brief as guidelines for good practice for GSCs to implement, and conducting a longer-term review of the working hours arrangements of non-skilled employees when the working hours guidelines of the property management and cleaning services sectors by the tripartite committees of the Labour Department are available.

     Detailed findings of the study are set out in the full Report, which has been uploaded to the website of the Labour and Welfare Bureau (

Ends/Wednesday, January 27, 2021
Issued at HKT 14:30