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The Implementation of the Minimum Wage System in Hong Kong GROUP 4 Group Leader: Chiu Cheuk Hin (4) Group Members: Kwok Wai Fung (10), Lee Ka Ching (16), Ngan Ka Kee (22) Chu Hiu Lam (28), Shiu Wai Fun (34)

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The Progress of the Implementation Minimum Wage in Hong Kong Comparison of minimum wage between Japan and Hong Kong Advantages of minimum wage Disadvantages of minimum wage Optimization of minimum wage system in Hong Kong Conclusion Content

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The Progress of the Implementation Minimum Wage in Hong Kong 2000 : Voice Out Set up a minimum wage Demanded by many people Protect Low-level workers income

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The Progress of the Implementation Minimum Wage in Hong Kong 2008: Wage Protection Movement October 2008 Launched by Labour Department Aimed to protect cleaners and security guards No satisfactory results Failed the demand of setting a minimum wage

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The Progress of the Implementation Minimum Wage in Hong Kong 2010: Proposed wage 10 th November Proposed wage: HK$28 per hour rate By the Provisional Minimum Wage Commission

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The Progress of the Implementation Minimum Wage in Hong Kong 2011: Implementation of the minimum wage system 5 th January Legislative Council accepted the proposed wage 1 st May Started $28/hr

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The Comparison of the Minimum Wage in Hong Kong and Japan

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What is the average minimum wage in Japan? HKD72 (100HKD: 1000YEN) When it started? 1959 Why it started? The Japanese Government this program can help workers with no fixed job (E.g. Site workers) The Minimum Wage in Japan

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QUESTION

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Reason (1): Worker-Oriented HK is a traditional city worker-oriented prefer using manpower than machines Japan : -No. of labour forces can be by using machines -Machines provide higher efficient and productivity reduce the production cost Wage can thus be Hong KongJapan Type of the citytraditional cityautomated city Influence of the Culture rely on staffuse machines and technology

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Reason (2): Not suitable for Automation Large investment The small capital of HK SME The investment on Automation( ) to HKs SME is comparatively large -The minimum wage already increase SMEs burden, The costs will > before * SME=Small and median size enterprise( ) Hong Kong (SME)Japan(SME) The Company ScaleSmallerBigger The capitalSmallerBigger Work in automation X

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Reason (3): Not suitable for Automation Hong KongJapan The area1095 sq. km29 751 sq.km The sizeSmallerLarger Not Enough Space The area and size of Hong Kong is smaller than that of Japan No extra land can be provide for automation in HK Automation X

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Reason (4): High Rent Limited Land + High Rent + Minimum wage HK SME cannot afford the increasing production cost Unemployment Increases End the business Hong KongJapan Area1095 sq. km29 751 sq.km SizeSmallerLarger Competitiveness( )between different enterprise HigherLower The rentHigherLower

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Reason (5): The culture Hong KongJapan Culture X Consumer tidy up after meal Consumer tidy up after meal So Employ more labour X Provide Cleaning Services In some fast food shop : More services is needed to provided to Hong Kong customers More workers are needed Production Cost The minimum wage in Hong Kong is lower than other countries

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Cheng Yiu Tong : The minimum wage can make the life of the primary attendant can be improved, and will not be insulting wages, but also said the minimum wage of $28 is the dignity of labor. Advantages of minimum wages implementation Cheng Yiu Tong (National People's Congress.)

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1. Increase the motivation of low-wage workers improve the efficiency and productivity 2. Protect the low-wage workers a minimum standard of living increase the purchasing power 3. Prevent the exploitation of workers with low technical level Employers used to pay them a lower wage Advantages of minimum wages implementation

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1.Lack of Manpower in Labour Force 2. the selling price 3.Deprived right of employees 4. the number of full-time jobs 5. the unemployment of elderly Disadvantages of minimum wages implementation

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The wages of many low-skilled jobs are the same as given in the hourly rate of $ 28 Workers will choose 1. a more comfortable working environment 2. less workload Lack of manpower Lack of manpower in labour force Disadvantage(1) : Lack of Manpower in Labour Force

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Example : Security guards VS cleaners Workers will choose to work as security guards Disadvantage(1): Lack of Manpower in Labour Work Security GuardsCleaners Physical StrengthLessMore Work outdoors for a long timeX More ComfortablyX

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Disadvantage (2): Increase of selling price Productio n Cost Transfer to Customers Selling Price

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Some unscrupulous( ) employers save the company costs minimize the workers meal period time / reduce staff working hours Disadvantage (3): Deprive the rights of employees

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Disadvantage (4): Less full-time jobs Full-TimePart-Time Amount of MPF paid by employers MoreLess With the implementation, the production cost of the company increases. Company needs to find another way to decrease the cost (e.g. decrease the cost of MPF) so as to maintain the profit Employs less full-time jobs, but more part-time jobs

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With the same amount of wage Employ different educated people. Employ highly educated young people instead of the elders Disadvantage (5): Increase Unemployment of elderly

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How to Optimize the Minimum Wage System in Hong Kong ?!

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What is Standard Working Hours?! - To make additional wage subsidies Why have to set up?! - Many workers work over time - The company paid the overtime wages X The Aim: -To protect the employees -Give the responsibility to the enterprise to compensate overtime working Method (1) : Set the Standard working hours The government should legislate this to protect the employees.

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What is the foundation?! -the government should provide funds to SME use to buy the machines Why have to set up ?! -Encourage SME to buy some machines to replaced some low skilled workers The AIM: -Reduce the low-skilled workers modern cities -Let Hong Kong to became a modern cities Method (2): Set Up A Foundation

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Who gave the training programs?! -The Open University Of Hong Kong -One Person One University ( ) Why have to increase?! -Unemployment of elderly and low-skilled workers is increase The AIM: -More elderly and low-skilled workers can find more professional jobs Method (3): Increase the training programs

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What is the object of this scheme? - manpower in labour work(E.g. Cleaners etc) What is the award scheme? Legislate the employee benefits Legislate bonuses Why have to set up? - The lack of manpower in labour work is The AIM: - Can attract the people will find some manpower work Method (4): Set Up Award Scheme

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limited land in HK tall building can be build to provide more spaces. Automation can be introduced. can increase the efficiency of the production, production cost thus decreases A higher minimum wage can be introduced Method (5): Increasing the construction of tall buildings

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Conclusion The purpose is good for low-wage worker Lower than other countries But Government needs to listen the voice of public The minimum wage system is needed to optimize

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