Being your own boss can be hard work
Self-employed people work longer hours but earn less than employees, a study has found.
According to the latest report on self-employment by the Census and Statistics Department, the self-employed work an average of 48 hours a week and earn a median HK$9,000 a month. Those in regular jobs work 45 hours a week for HK$10,500.
'The overwork and underpay phenomenon could probably be attributed to the fact that some fake self-employment cases were included in the study,' said Tam Chun-yin, a member of the Confederation of Trade Unions. 'Those cases would definitely drag down the amount of salaries, and drive up the working hours, as employees involved in false self-employment are only treated as service providers, and exploited by their employers.'
False self-employment refers to the practice of employers forcing workers to become self-employed, usually to avoid annual and statutory holiday payments, employers' contributions to the Mandatory Provident Fund, work insurance or compensation for injuries.
The study, conducted between April and June last year, interviewed 10,100 households in the city, and estimated that there were 186,800 self-employed people, down 10 per cent since 2003.
A self-employed person is defined as someone who works for profit or fees in his or her own business, is not employed by someone and does not employ others.
One-third work in the transportation, postal and courier services, and communications industries. About 62 per cent have been self-employed for 15 years or more.
Nearly 20 per cent of those surveyed chose self-employment because they wanted their own business or were tired of routine work.
Some wanted more freedom, while others were pushed into self-employment by their bosses.
But Tam did not share the concern of some members of the Labour Advisory board, who said in May, when the HK$28 per hour minimum wage came into force, that false self-employment would increase.
Tam said the status of a worker was not determined solely by the kind of contract they signed, but the nature of their work. If an employer provided the tools a person needed to do their job, they could not be said to be self-employed.
So far, his group has not received any complaint about fake self-employment related to the pay floor.
Labour Department statistics shows that there were 397 claims of false self-employment between October 2009 and May this year, or an average of 20 cases a month.
In 148 of the 397 cases, the employer or contractor was ordered to make a payment to, or reach a settlement with, employees.
According to a Legislative Council paper, the Labour Department plans to curb false self-employment by enhancing awareness, providing a consultation and conciliation service, and stepping up enforcement action.