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

1. Minimum Wage Policy in Hong Kong Macy Lee (09428526) Calvin Chung (09409572) POLS 7050 Public Administration Presentation

2. History of minimum wage Policies / Laws in other countries “sweatshops” in manufacturing industries 1890s :Adopted in New Zealand and Australia 1909 :Adopted in UK 1938 :a federal minimum wage law passed by U.S. Congress Sweatshops

3. History of minimum wage Policies / Laws in Hong Kong 1932: Minimum Wage Ordinance (MWO) but hasn’t been used. 1990’s: Minimum wage discussion started to become a popular topic in society 2005-2006: Wage Protection Movement (WPM)

4. History of minimum wage Policies / Laws in Hong Kong (Cont’d) 2007: The Wage Protection Movement failed Feb 2009: Provisional Minimum Wage Commission appointed

5. Why do we need a minimum wage policy?

6. Minimum wage as a basic human rights Universal Declaration of Human Rights : Article 25 International Covenant on Economic, Social and Cultural Rights : Article 7

7. Size of the working poverty group is a concern in HK Over 1 million people, which accounts for about 14% of the entire HK population, is classified as part of the working poverty group Potentially induces social instability if the sources of their income cannot be protected

8. Inequality distribution of income in Hong Kong Gini coefficient: 1991: 0.476 2006: 0.533; 2009*:0.53 (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)

9. Minimum wage policy is a world trend? Over 100 countries have different types of minimum wage PRC, Guangdong Province: implemented its minimum wage system in 1994

10. However, is this legislation is the best choice for HK people? Marginal workers Working poor Social instability

11. Existing proposal (WPM) for minimum wage policy 1)national-wide 2)domestic workers 3)clear guidance to determine the wage level 4)penalty and implementation plan 5)supportive scheme/ subsidy was mentioned in the policy

12. Hence….. the legislation of minimum wage is needed

13. However…..this policy is needed to be adjusted and parallelly implemented with other supportive policies

15. We propose the following modifications, implemented in 2 phases 2 phases

16. Phase 1 : 2009-2014 Provisional Minimum Wage Commission determine the level of the of minimum wage Multi-industry / national minimum wage

17. Phase 1 : How to measure? Use following criteria to measure minimum wage :

18. Phase 1 : Who can protected by? The minimum wage system applies to most workers which also includes: Domestic worker Employees with disabilities Trainees and apprentices

19. Phase 1: Others Enforcement Penal provisions

20. Phase 1: The Supportive Schemes Enhance the ERB (Employees Retraining Board) scheme Government subsidy – to employer/employee Match up policy with “Comprehensive Social Security Assistance Scheme" (CASS)

22. 2)Annual review unemployment rate and average wage in HK

23. 3) Minimum wage policy on inflation risk

25. Phase 2 Evaluation 1)A 5-year review 2)Review economic effect and the cost effect after launch the minimum wage policy 3) Review the penalty and monitoring system

26. Conclusion Worker Boss 1)A Lower social-cost policy 2) Able to eradicate the working poverty as well as to bring a minor negative effect to economy 3) For a long-term aspect, this policy can maintain social stability and enhance resource allocation Society Government

27. Thank You!!- END -