Hong Kong’s errant domestic helper agencies are everywhere and unafraid of the law
David Bishop says the recent amendment to the Employment Ordinance to crack down on widespread illegal practices among helper employment agencies is a step in the right direction. Unfortunately, the agency tasked with the job appears to be underfunded
On February 9, the Hong Kong government took a big step towards securing the city’s economic future and rehabilitating its reputation for rule of law. That day, the Employment Ordinance was amended to curb the rampant abuses of one of Hong Kong’s largest black markets: domestic worker employment agencies.
The amendment increased penalties for overcharging workers and operating an employment agency without a licence from a fine of HK$50,000 to one of HK$350,000 and three years’ imprisonment. The statutory time limit for prosecution of abuses was extended from six months to 12 months, giving employers and domestic workers more time to bring legal claims against agencies. The ordinance now covers persons associated with agency licensees, making it harder for bad actors to hide behind complex ownership structures.
This was a necessary and overdue change. Numerous reports have explained how Hong Kong’s 1,400 domestic worker agencies overcharge workers, steal passports and lie to employers. Surveys consistently show the distrust that employers have towards agencies, and frequent protests by domestic workers are reminders that they, too, are tired of illegal agency practices. Everyone seems to agree that agencies need more regulation and stiffer penalties for bad behaviour.
But, surprisingly, this important move went largely unnoticed, despite the government’s pronouncements at the end of 2017 on the importance of helpers to our economy. Secretary for Labour and Welfare Dr Law Chi-kwong said the number of helpers in Hong Kong would need to increase from 360,000 to 600,000 over the next 30 years.
Considering that the current number represents 10 per cent of our working population, this is significant.
Why has the government increased penalties after so many years? One important reason surfaced in Dr Law’s interview: competition for workers from other places, such as mainland China, Japan and South Korea.
Let’s be clear: without major policy and significant lifestyle changes, Hong Kong would fall apart without helpers. Middle-class women stand to lose the most if this supply of labour is diminished. Most dual-income families employ a helper, contributing to Hong Kong having one of the highest rates of female tertiary education and employment in the world.
In this #MeToo era, I hope we can all agree that female empowerment is great – but only so long as it does not come at the expense of other women.
Having been part of a group that brought legal claims against agencies that broke the law and lobbied the government to include criminal penalties and extend the statutory time limit for legal claims, one thing has become clear: the government is not providing enough resources to police the industry.
There are more domestic worker agencies in Hong Kong than McDonald’s, 7-11 and Starbucks outlets combined. It is apparent that such an industry cannot exist but for illegal behaviour. By creating intricate corporate webs, criminals have been able to avoid prosecution.
In the past, penalties against agencies were so low that licensees did not fear prosecution. But with the amended ordinance, theoretically, criminal agencies should be wary. But even now, there is really very little fear of broad prosecution.
On Tuesday, I visited the Employment Agency Administration to report an agency that we had watched since December, with evidence of their illegal behaviour. This agency had already had its licence revoked on two occasions, and the sole corporate shareholder was dissolved by the government in 2011, meaning that the sole owner did not exist. This was, essentially, a ghost company that preyed on workers and employers. Every time it was shut down, it reopened in the same location, with the same contact information, changing its name and pasting a new storefront sign over its previous one.
When I presented our case to the government investigators, they were not surprised as they knew of the agency’s history. But while I was assured that they would do their best to shut the agency down for good, their cynicism was palpable.
One might ask why the Employment Agency Administration has failed to do so so far. The answer is simple: there is an entire industry of such agencies. The agencies outnumber the policing officers. Studies have shown that at least 70 per cent of the agencies violate the law, implying there are at least 980 illegal agencies with only a handful of people to police them.
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I noticed that the Employment Agency Administration’s office lobby was so small that I could touch the walls on both sides by extending my arms. Why? Does the government not see its work as important? Given their lack of resources and space, it would be impossible for its officers to work closely with employers and helpers to ensure the proper policing of agencies.
Millions of jobs, now and in the future, are directly affected by this agency’s work. Increasing funding to it seems like a prudent investment that would pay for itself several times over. If we are going to avoid the pitfalls decried by Dr Law and the Labour Department, we must act now.
David Bishop is a principal lecturer in the Faculty of Business and Economics at the University of Hong Kong