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Hong Kong trade unionists despair of minimum wage mechanism

Activists say the two-yearly review should be carried out every year to ensure that workers receive more money, but government says system offers flexibility

PUBLISHED : Thursday, 29 September, 2016, 9:35pm
UPDATED : Thursday, 29 September, 2016, 11:12pm

When Hong Kong’s former chief executive, Donald Tsang Yam-kuen, admitted in 2008 that a voluntary scheme to encourage bosses to pay their staff decent wages had failed, leading to the establishment of the Minimum Wage Commission to legislate on minimum pay, the labour sector hailed it as a step forward.

Fast forward to 2016 with the minimum wage currently set at HK$32.50 per hour, and the labour sector is angry not only that it is too low, but that the review mechanism itself is a failure.

Hong Kong domestic helpers wait on wage review

Unionists said while Hong Kong prided itself on its status as an international financial centre, the city’s minimum wage was a source of shame compared to those in other countries and territories, such as Japan and Taiwan.

“Hong Kong’s gross domestic product per capita is as high as a lot of developed countries, but the minimum wage is a lot lower than them,” Confederation of Trade Unions chief executive Mung Siu-tat said.

In 2006, Tsang introduced the “wage protection movement” for cleaning workers and security guards. Under this campaign, participating companies had to pay their staff at least the median wage.

But the response was lukewarm, with only 1,194 companies covering 30,000 of the city’s estimated 150,000 cleaners and security guards signing up for the scheme.

Tsang admitted in 2008 that the campaign had failed and finally vowed to introduce a minimum wage law for all occupations.

Hong Kong’s first minimum wage of HK$28 per hour came into effect in 2011, rising to HK$30 in 2013 and HK$32.50 in 2015.

In Taiwan, where the cost of living is much lower than in Hong Kong, the hourly minimum wage is HK$29.60.

The hourly minimum wage in Japan varies from city to city. In Tokyo it is set at HK$70.

In Australia, the level is much higher at HK$105 per hour. In Britain, it is the equivalent to HK$67.60 and in New York HK$70.

Understandably, the level is much lower on the mainland. The monthly minimum wage is HK$2,381 in Shenzhen and HK$2,369 in Shanghai.

Mung said a crucial flaw was that the level is reviewed “at least” every two years, instead of every year. The government insists that its policy to review the minimum wage “at least” every two years offers flexibility.

Some of the latest government data presented to the commission was from 2015 because it takes time to come up with current data. And even if the commission manages to reach a consensus on the new level on Friday, it will not become effective until next year.

“It is important that the level is reviewed every year,” trade unionist Mung insisted.