Practical solution to overtime hours question takes case-by-case option

Acknowledging concerns in society about the issue of working hours, Chief Executive Leung Chun-ying set up the Standard Working Hours Committee in April 2013. This had the task of following up on the "Report of the Policy Study on Standard Working Hours" released by the government in November 2012.

Following work by the committee, the government proposed legislation to regulate working hours for low-paid workers, which was passed by the Executive Council last week. The new law requires employers to negotiate (and clearly indicate) the number of working hours in written contracts with employees earning HK$11,000 or less each month. After this, overtime must be paid at no less than the regular rate.

The new approach will probably work like this: The Statutory Minimum Wage was raised to HK$34.50 an hour from May 1. This means HK$11,000 will only give an employer a mere 320 hours of labor, or 10.6 hours of labor a day with no rest days for a month. Anything more than this and the employer has breached the law.

After the new regime came into effect, employees earning HK$11,000 or below a month will be protected by two things. The first is the specific amount of working hours done by a worker; the second is a guaranteed overtime pay for employees at "no less than the regular rate".

There are two things employers can do to defy the new working-hour regime. First, they can give standard working hours specification in a work contract of 10.6 hours a day for seven days a week. This is a criticism both about the new working-hour regime and the statutory minimum wage requirement. Employees can take it or leave it.

Come to think about it, why don't we make it 11 hours per day, seven days a week, so as to compensate for mandatory labor holidays?

A second, alternative, approach would be in situations when the employee has a salary of close to HK$11,000, then the employer is likely to raise it to HK$11,001. This is so the employee will not be protected by working-hour regulations.

The above scenarios are supported by industry practices. According to the South China Morning Post, for example: "Yu Mei-wan, a 61-year-old security guard said 90 percent of workers like her had to clock in for 12 hours a day. This was stipulated in their contracts. She did not expect Leung's proposal to make their lives any better because employers could manipulate their contract terms." By contract terms she certainly meant the hourly rate.

This is an example of the second approach: Again according to the Post, "Simon Wong Kit-lung, who operates more than 30 restaurants, said his business would not be affected by the new policy. Almost all of his full-time workers were already making more than HK$11,000 a month."

This new arrangement is not meant to benefit a lot of people, as the principal government economist Desmond Hou Ka-chun has admitted. Indeed, only 6 percent of those earning HK$11,000 or less worked overtime without being compensated.

It is important to note that the new working hours' regime is not about helping workers find a work-life balance - or anything like that. It is only a matter of mandatory overtime payments.

Whether or not employees should be paid for performing extra work has always been a controversial subject in Hong Kong. Past studies indicate that employers tend not to like paying overtime, whereas employees tend to insist on overtime payments.

The business sector's welcome of the government's proposal for mandatory payment for overtime work for employees earning less than HK$11,000 a month is a remarkable feat for the Standard Working Hours Committee.

Standard working hours in this newly proposed form will naturally be a disappointment to labor unions. But remember, an across-the-board, citywide standard may not be the best thing for the city. A case-by-case standard, as specified in individual contracts, although modest, is sometimes more practical and effective.

(HK Edition 06/20/2017 page8)