Minimum wage deadlock makes rise uncertain

PUBLISHED : Tuesday, 29 May, 2012, 12:00am
UPDATED : Tuesday, 29 May, 2012, 12:00am


Businesses and unions have been unable to find any middle ground on raising the minimum wage level, as an eight-week consultation came to an end yesterday.

Labour unions claim inflation, which has been running at above 5 per cent for most of the past year, has 'eaten away' the benefits of the statutory minimum wage introduced last May. They and various concern groups want to see a rise from the current HK$28 an hour to between HK$32 and HK$35 an hour.

However, business groups advocate a freeze or an increase to no more than HK$31 to cater for rising living costs, according to submissions to the government.

Meanwhile, a recent survey of 2,000 cleaners, some of the city's lowest paid workers, found they were worried that an increase in the minimum wage could worsen inflation.

The results of the consultation will be discussed by lawmakers today at a meeting of the Legislative Council's labour committee.

In its submission to the government, the Institution of Dining Art, which represents 2,000 restaurants in the city, said the wage level should be maintained at HK$28.

'Future economic prospects are uncertain, while rents and the cost of raw materials have been rising. Further lifting the wage floor will badly hit the sector,' the group said.

David Fong Man-hung, vice-chairman of the Chinese General Chamber of Commerce, said that while an increase would be reasonable, the government should take a 'conservative approach'.

The chamber said it was concerned about the impact of the minimum wage during an economic downturn. Fong said businesses were more likely to accept an increase of less than 10 per cent, meaning a rise to no more than HK$30.80.

The Federation of Hong Kong Industries recently suggested a similar increase to around HK$30 to HK$31.

At the other end of the scale, the Neighbourhood and Workers Service Centre said the wage level should be raised to HK$35. It said the current level was not enough to encourage those on the dole to seek work. 'The statutory wage floor must be higher than the dole levels,' the group, led by legislator Leung Yiu-chung, said.

However, a survey by the Environmental Services Operatives Union found the majority of 2,000 cleaners were concerned about the effect a rise in the minimum wage would have on inflation, with 30 per cent calling for the minimum wage to be kept at HK$28.

Secretary for Labour and Welfare Matthew Cheung Kin-chung said yesterday that a taskforce set up by the government to review the wage level, which will advise the government on how to adjust the minimum wage in October, would study the results 'fairly and objectively'.

He said a study on standard working hours would be completed by the end of June, with findings to be considered by officials. Cheung said the issue of standard working hours was complex, so more time was needed for officials to set out views.