Minimum Wage Policy in Hong Kong


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As eradicating the working poverty, the minimum Wage legislation is needed in Hong Kong.
by Macy Lee 09428526 and Calvin Chung 09409572

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Minimum Wage Policy in Hong Kong

  1. 1. Minimum Wage Policy in Hong Kong<br />Macy Lee (09428526) <br />Calvin Chung (09409572)<br />POLS 7050 Public Administration Presentation<br />
  2. 2. History of minimum wage Policies / Laws in other countries<br />“sweatshops” in manufacturing industries<br />1890s :Adopted in New Zealand and Australia<br />1909 :Adopted in UK<br />1938 :a federal minimum wage law passed by U.S. Congress<br />Sweatshops<br />
  3. 3. History of minimum wage Policies / Laws in Hong Kong<br />1932: Minimum Wage Ordinance (MWO) but hasn’t been used.<br />1990’s: Minimum wage discussion started to become a popular topic in society<br />2005-2006: Wage Protection Movement (WPM)<br />
  4. 4. History of minimum wage Policies / Laws in Hong Kong (Cont’d)<br />2007: The Wage Protection Movement failed<br />Feb 2009: Provisional Minimum Wage Commission appointed<br />
  5. 5. Why do we need a minimum wage policy?<br />
  6. 6. Minimum wage as a basic human rights<br />Universal Declaration of Human Rights : Article 25<br />International Covenant on Economic, Social and Cultural Rights : Article 7<br />
  7. 7. Size of the working poverty group is a concern in HK<br />Over 1 million people, which accounts for about 14% of the entire HK population, is classified as part of the working poverty group<br />Potentially induces social instability if the sources of their income cannot be protected<br />
  8. 8. Inequality distribution of income in Hong Kong<br />Gini coefficient: <br />1991: 0.476 <br />2006: 0.533;<br />2009*:0.53<br />(Rank no. 1 in Asia in 2009 from U.N. Development Program, and compare with other developed countries like USA, who has 0.45 Gini coefficient score in 2007)<br />
  9. 9. Minimum wage policy is a world trend?<br />Over 100 countries have different types of minimum wage<br />PRC, Guangdong Province: implemented its minimum wage system in 1994<br />
  10. 10. However, is this legislation is the best choice for HK people? <br />Marginal workers<br />Working poor<br />Social instability<br />
  11. 11. Existing proposal (WPM) for minimum wage policy <br />1)national-wide<br />2)domestic workers<br />3)clear guidance to determine the wage level<br />4)penalty and implementation plan<br />5)supportive scheme/ subsidy was mentioned in the policy <br />
  12. 12. Hence….. the legislation of minimum wage is needed <br />
  13. 13. However…..this policy is needed to be adjusted and parallelly implemented with other supportive policies<br />
  14. 14.
  15. 15. We propose the following modifications, implemented in 2 phases <br />2 phases<br />
  16. 16. Phase 1 : 2009-2014<br />Provisional Minimum Wage Commission determine the level of the of minimum wage<br />Multi-industry / national minimum wage<br />
  17. 17. Phase 1 : How to measure?<br />Use following criteria to measure minimum wage :<br />
  18. 18. Phase 1 : Who can protected by?<br />The minimum wage system applies to most workers which also includes:<br />Domestic worker<br />Employees with disabilities<br />Trainees and apprentices<br />
  19. 19. Phase 1: Others <br />Enforcement<br />Penal provisions<br />
  20. 20. Phase 1: The Supportive Schemes<br />Enhance the ERB (Employees Retraining Board) scheme<br />Government subsidy – to employer/employee<br />Match up policy with “Comprehensive Social Security Assistance Scheme&quot; (CASS)<br />
  21. 21. Phase 1 Evaluation <br /><ul><li>1)By annual review index
  22. 22. 2)Annual review unemployment rate and average wage in HK
  23. 23. 3) Minimum wage policy on inflation risk
  24. 24. 4) Investment on-the-job training</li></li></ul><li>Phase 2: 2014-2019<br />1) Expand function of the minimum wage commission<br />2) Extend the coverage of the minimum wage policy ( e.g. by age, by nature of the job) <br />3) Enhance the criteria for determining the minimum wage( e.g. labor productivity, employment rate) <br />
  25. 25. Phase 2 Evaluation<br />1)A 5-year review<br />2)Review economic effect and the cost effect after launch the minimum wage policy<br />3) Review the penalty and monitoring system<br />
  26. 26. Conclusion <br />Worker<br />Boss<br />1)A Lower social-cost policy<br />2) Able to eradicate the working poverty as well as to bring a minor negative effect to economy<br />3) For a long-term aspect, this policy can maintain social stability and enhance resource allocation<br />Society<br />Government<br />
  27. 27. Thank You!!- END -<br />