Employment in Hong Kong

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Employment in Hong Kong
Overview

Hong Kong has an area of 1,103 square kilometres and a population of about 6.99 million as of 2006. Despite its small size, Hong Kong was ranked the 11th largest trading entity in the world in 2003. The total value of visible trade amounted to $3,548.2 billion in 2003. During the period of 1993 to 2003, the Gross Domestic Product (GDP) grew at an average annual rate of about 3.2% in real terms, to $1,361.2 billion in 2003. Per capita GDP reached 179,333 (US$ 23,030) in money terms. Based on the results of the General Household Survey, the size of the total labour force in the second quarter of 2004 was 3.52 million, of whom 55.8% were male and 44.2% were female. This represented 61.3% of the total population aged 15 and over.

Labour legislation and labour standards

The momentum in improving working conditions, Occupational Safety and health and employees’ rights and benefits has been kept up through an extensive programme of labour legislation. Some 42 pieces of legislation were enacted between 1997 and 2001. More are in the pipeline. Hong Kong aims at applying relevant International labour standards as the local circumstances allow. As of April 28, 2000, Hong Kong is following 40 Conventions, exceeding most countries in the region.

Working conditions

The Employment Ordinance provides the framework for a comprehensive code of employment. It governs the payment of wages, the termination of employment contracts and the operation of employment agencies. The law provides statutory holidays with pay, sick leave, maternity protection, rest days, paid annual leave and employment protection for employees. All employees have statutory protection against anti-union discrimination. The law also provides for severance pay to workers made redundant, and long service payment to workers with long service who are dismissed for reasons other than redundancy, or on disciplinary grounds, who die in service, or who resign on grounds of ill health or old age. Employees who are owed wages, wages in lieu of notice and/or severance payments by insolvent employers may apply for ex-gratia payment from the Protection of Wages on Insolvency Fund which is financed by an annual levy on business registration certificates. The Employment of Children Regulations prohibit the employment of children aged under 15 in all industrial undertakings. Subject to certain protective restrictions, children aged 13 and 14 who are attending school may take up part-time employment in the non-industrial sectors. The Employment of Young Persons (Industry) Regulations govern the employment conditions of young persons aged 15 to 17 in industrial undertakings. These young persons are not allowed to work more than eight hours a day and 48 hours a week. Overtime work for them is prohibited. Eight special enforcement teams of labour inspectors are responsible for monitoring employers’ compliance with various labour legislation to safeguard the rights and benefits of local and imported workers.


Trade unions and industrial disputes

Hong Kong residents have the right and freedom to form and join trade unions. At the end of December 2001 there were 654 registered trade unions, consisting of 610 employees’ unions, 25 employers’ associations and 19 mixed organisations of employers and employees. The total estimated membership was around 683,000. Hong Kong has an outstanding record of industrial peace. In 2001, it lost 0.26 working day per 1,000 workers. During the year, the Labour Department dealt with 31,698 labour problems, most of which were grievances involving claims of wages in arrears, wages in lieu of notice and holiday pay. There was one work stoppage, and the number of working days lost was 780.

Minor employment claims adjudication board

One source of employment in Hong Kong is street markets.
One source of employment in Hong Kong is street markets.

To speed up the settlement of minor employment claims, the Minor Employment Claims Adjudication Board was set up in the Labour Department in 1994 for the adjudication of rights claimed under the Employment Ordinance and in accordance with individual employment contracts. The board hears claims by not more than 10 claimants for a sum not exceeding $8,000 per claimant. Hearings are conducted in public and procedures are simple and informal. Claims by more than 10 claimants, or more than $8,000 per claimant, are heard by the Labour Tribunal.

Labour Tribunal

The tribunal comes under the Judiciary and provides a quick, inexpensive and informal forum for settling labour disputes. It hears employment claims for a sum of money arising from the breach of a term of a contract of employment or the failure to comply with the Employment Ordinance or the Apprenticeship Ordinance.

Occupational safety and health

The Occupational Safety Officers of the Labour Department promote and protect the health and safety of employees in the industrial and non-industrial sectors. To reduce accidents and guard against ill-health, efforts are focused on legislative control, safety training, education and promotion. Under the Occupational Safety and Health Ordinance and the Factories and Industrial Undertakings Ordinance, 31 sets of regulations have been made to cover various aspects of hazardous activities in factories, building and engineering construction sites, restaurants, catering establishments, commercial premises and other workplaces. In 2001, 126,470 inspections and 12,500 accident investigations were conducted. A total of 2 660 prosecutions were taken out with fines totalling $32.3 million. In 2001, 597 training courses on safety legislation for 6,391 people and 218 tailor-made briefing sessions for 6,874 employees in private and public sector organisations were given. Safety and health publications were distributed to members of the public through various outlets and 241 publication stands placed in major shopping centres, housing estates, clinics, transport stations, public utility service counters and government offices. The Occupational Safety Charter, setting out the rights of employees to enjoy a safe working environment and the employers’ obligations to reduce the risk of accidents, remains a major promotion programme and as at the end of 2001, 558 organisations, including employer and employee bodies, have subscribed voluntarily to the charter. Five major publicity campaigns were launched in 2001, including a safety award scheme to promote safety in the catering industry, a programme to promote a greater awareness of occupational safety and health among small and medium enterprises, a safety award scheme to promote safety in the construction industry, a campaign to promote the Factories and Industrial Undertakings (Safety Management) Regulation and the Factories and Industrial Undertakings (Loadshifting Machinery) Regulation, and production of two television Announcement in Public Interests and four radio Announcement in Public Interests.

Employees’ compensation

Under the Employees’ Compensation Ordinance, an employer is liable to pay compensation to an employee who suffers personal injury arising out of and in the course of employment, or to eligible family members of an employee who is killed in an accident at work. All employers are required to have valid employees’ compensation insurance policies to cover their liabilities both under the ordinance and at common law. The Employees’ Compensation Ordinance is administered by the Employees’ Compensation Division of the Labour Department, which handled 201 fatal accident cases and 67,540 non-fatal cases in 2001. Among these non-fatal cases, 10,722 were minor injury cases with sick leave not exceeding three days. The division also provides administrative support to the Employees’ Compensation Assessment Board which assess the percentage of permanent loss of earning capacity suffered by injured employees. The Pneumoconiosis Compensation Office offers assistance to persons who have contracted pneumoconiosis or in case of their death their family members to obtain compensation from the Pneumoconiosis Compensation Fund Board which is financed by a levy on the construction and quarrying industries.

Finding employment

The Labour Department provides free recruitment assistance to employers and placement service to job-seekers through a Job Vacancy Processing Centre, a Telephone Employment Service Centre and 11 Job Centres (including two employment and guidance centres for new arrivals) distributed over the territory. Through the Job Matching Programme, the Job Centres provide briefing, intensive job-matching and counselling services to unemployed job-seekers. Employers and job-seekers may also make use of the Interactive Employment Service (iES) (http://www.jobs.gov.hk) provided by the department on the web to submit vacancy information or register for placement service. All vacancies received by the department are posted on the web site for public viewing. Members of the public may access the iES with internet connected personal computers, public computer facilities at district offices, community halls, public libraries and post offices, and public information kiosks distributed over Hong Kong. To improve its operating environment and enhance the quality of service, the Labour Department has re-provisioned its Job Centres to include such facilities as briefing room, reading area and audio-visual corner for job-seekers. Telephones, fax machines and computers with internet connection are also available to facilitate job-seekers to search suitable jobs on the Internet, prepare resumes and make direct job applications with employers.

Employment assistance to people with disabilities

The Selective Placement Division provides free specialised employment assistance to people with disabilities seeking open employment. The service caters for the visually impaired, hearing impaired, physically handicapped, chronically ill, mentally handicapped and ex-mentally ill. During 2001, the division recorded 4,128 registrations and achieved 2,348 placements.

Employment distribution

Total employment in the first quarter of 2006 was 3.43 million. The employment distribution among various industry sectors was as follows:
Industry Sector    Distribution (%)
Manufacturing    5.2
Construction    7.9
Wholesale, retail and import/ export trades, restaurants and hotels    34.1
Transport, storage and communications    10.6
Financing, insurance, real estate and business services    15.3
Community, social and personal services    26.2
Others    0.7
Total employment    100.0

(Note: There may be a slight discrepancy between the sum of individual items and the total as shown in the table owing to rounding)

Hong Kong's economy has historically been driven by its status as one of the major transport and logistic hubs for East Asia. In more recent years, Hong Kong has seen other sectors become more important in its economy. Financial and banking services have become a much larger part of the high-end economy in Hong Kong and one of the major drivers of economic growth. The growth of these businesses has helped Hong Kong keep its position as one of the world's top economies.

However, like many developed nations Hong Kong also faces a problem of income disparity. Though the accuracy of the Gini coefficient has been called into question, it does give an estimate of income inequality. According to World Bank statistics, in 2003 Hong Kong was at 0.52 which put it on the same level as Mexico or Russia.

Wages

There is no legal minimum wage in Hong Kong. The wage level prevailing is essentially the result of interplay of supply and demand. Wages are usually calculated on hourly, daily, monthly, or piece rates. In September 2004, the average monthly wage rate for the supervisory, technical, clerical and miscellaneous non-production workers in the wholesale, retail and import/export trades, restaurants and hotels sector was HK$11,293. Based on the wage indices, the average wage rate for this group of workers decreased by 1.9% in money term, or decreased by 3.1% in real terms, compared with the same period of 2003. The overall average daily wage was HK$311 for the workers at craftsmen and operatives levels in the manufacturing sector.