Minimum wage law a step in the right direction

PUBLISHED : Sunday, 01 May, 2011, 12:00am
UPDATED : Sunday, 01 May, 2011, 12:00am


It's a landmark day for Hong Kong, land of the free market: the minimum wage law takes effect. Not that long ago, this wouldn't have seemed possible. Yet this Labour Day, the most fitting of occasions, has dawned with every employee guaranteed pay of at least HK$28 an hour.

There's no better time for the legislation to take effect. Anxiety is high about the wealth gap and social equity. The government is under fire, accused of colluding with big business at the expense of the poor. It's these people, on the bottom rung of the social ladder, who will benefit most from the minimum wage.

The step had to be taken. Hong Kong was falling far behind other developed societies in a number of key social areas. Some independent welfare groups contend that as many as one in five people live near or below the poverty line.

A recent regional survey showed our employers are the most demanding of all, expecting staff to work long hours and overtime and to be on call during days off and holidays for little or no compensation. Our gap between rich and poor is the widest of any developed economy. And we work more hours each week than anyone else in the developed world.

These factors have drawn companies to the city and employment rates have been boosted, but Hong Kong's image and reputation have suffered. The government's push for minimum-wage legislation, which is finally in effect after 13 years of public discussion and debate, was long overdue. Labour Day, traditionally a time for workers to air their grievances in demonstrations and street protests, should this year be a time to celebrate. There are certainly people who have been cheered - although it would be wrong to say that there's a festive mood.

During the course of long negotiations, some in the business sector argued that such a law would have a negative impact on the economy. But this has not proved to be the case in other parts of the world where minimum-wage laws have been introduced.

Certainly, the law will hit certain sectors harder than others. The catering industry is one such sector and, unsurprisingly, it has fought the hardest against a minimum wage. Its arguments, and those of small and medium-sized companies, are likely to have contributed to the decision to leave open the question of whether rest days and meal breaks should be paid.

Amid debate on these grey areas in the months leading up to the implementation of the minimum wage, the government has not presented a clear picture. A belated measure to ensure that its contractors are in compliance and paying for rest days, though not meal breaks, has created confusion, not clarity.

That's left companies to find their own way, with some fairly boosting workers' wages and others meanly negotiating new contracts that leave employees financially worse off. Such ambiguity shouldn't exist. The law has to be fairly administered and be clearly understood.

Most important, though, is that employers embrace the spirit of the measure. A minimum wage is, after all, just the first stage of a process of improving the lives of all. The government's next step is to look into the issue of standard working hours. While that process is under way, our newest labour law has to be protected, strengthened and improved. It's symbolic value is clear: we are dedicated to improving the lives of our worst-off workers.