Standard Working Hours

Transcription

1 The Council of Hong Kong Professional Associations CPD Talk Standard Working Hours Speaker: Ms Julita Leung Chairperson Minimum Wage and Standard Work Hours Taskforce Hong Kong Institute of Human Resource Management 6 Jul 2013 Contents About HKIHRM An Overview of Global Working Hours Situation Major Drivers of Introducing Standard Working Hours Latest Developments of Standard Working Hours Views on Standard Working Hours Possible Impact of Standard Working Hours Conclusion 2 HKIHRM 1

2 About HKIHRM Established in Feb 1977, the HKIHRM has more than 5,000 members, with close to 600 of whom being corporate members Mission: to develop, maintain and enhance professional HR management standards, and to increase the perceived value and influence of HR profession Work target to enhance professionalism of HR practitioners by - running a professional membership scheme - providing professional training - organising professional standards examinations - conducting HR-related research and surveys - providing profession-related, social and economic information - granting HR Excellence Awards to outstanding HR professionals in Hong Kong Collect and reflect members views on government policies and practices Member of the Asia Pacific Federation of Human Resource Management and World Federation of People Management Associations 3 An Overview of Global Working Hours Situation Standard Working Hours France Japan Singapore South Korea US UK 35 hours per week 8 hours per day and 40 hours per week 8 hours per day and 44 hours per week 8 hours per day and 40 hours per week 40 hours per week 48 hours per week (including overtime) Maximum overtime hours allowed 220 hours per year (may be extended with a collective agreement) 2 hours per day for jobs which may cause harm to health 72 hours per month 12 hours per week no limit - included in weekly maximum working hours - can be extended by agreement - opt-out allowed 4 HKIHRM 2

3 An Overview of Global Working Hours Situation (con t) France Japan Singapore South Korea US UK Overtime pay rate 25% increase for first 8 hours/week, and 50% increase for additional overtime hours 25% increase, 50% if > 60 OT hours/month 50% increase 50% increase 50% increase no statutory level but typical rate 50% increase Source: Fact Sheet of Standard Working Hours in Selected Places by Legislative Council Secretariat and International Labour Organisation 5 An Overview of Global Working Hours Situation (con t) Exemption of Coverage France Japan Singapore South Korea US UK Managers and nonmanagement employees working off the premises Management and supervisors, agriculture and fishing, intermittent work (eg caretakers and persons employed to look after working premises or warehouses) Executives, employees with supervisory functions, high-skilled professionals, eg doctors & lawyers Businesses or workplaces < 5 employees; and certain types of occupations, eg agriculture and forestry work, livestock breeding, intermittent work (eg caretakers) Executive, administrative and professional employees, and certain skilled computer professionals Employees of certain sectors who are protected by another legislation, eg seafarer, specified occupations and nature of work such as hospital and residential care Source: Fact Sheet of Standard Working Hours in Selected Places by Legislative Council Secretariat and International Labour Organisation Report of the Policy Study on Standard Working Hours 6 HKIHRM 3

4 Major Drivers of Introducing Standard Working Hours in Hong Kong Long working hours Unpaid overtime work Heavy workload leading to a lack of work-life balance 7 Median Hours of Work of Employed Persons by Industry Industry Q Q Q Manufacturing Construction Import/export trade and wholesale Retail, accommodation and food services Transportation, storage, postal and courier services, information and communications Financing, insurance, real estate, professional and business services Public administration, social and personal services Other industries Overall (Source: Quarterly Report on General Household Survey First Quarter 2013) 8 HKIHRM 4

5 Median Hours of Work of Employed Persons by Occupation Occupation Q Q Q Managers and administrators Professionals Associate professionals Clerical support workers Service and sales workers Craft and related workers Plant and machine operators and assemblers Elementary occupations Other occupations Overall (Source: Quarterly Report on General Household Survey First Quarter 2013) 9 Working Hours and Unpaid Overtime Work Report of the Policy Study on Standard Working Hours by Labour Department (Nov 2012) Hongkongers worked 47 hours a week on average. Of the 2.81 million workers, 23.4% had worked overtime, of which 51.8% of them had been paid for the extra time. Among employees who had worked overtime without pay, 77% were high-skilled workers who worked overtime for an average of 8.9 hours a week. A survey covering more than 800 whitecollar employees conducted by a labour union under the Hong Kong Federation of Trade Unions in early % of the respondents worked from 46 hours to 61 hours or above each week more than 70% respondents worked overtime without any pay 10 HKIHRM 5

6 Working Hours and Unpaid Overtime Work (con t) A survey of 1,125 employees conducted by the Hong Kong Research Association in Q % of the respondents said they needed to work overtime, among whom 63% did not receive overtime pay financial and insurance sectors had the highest proportion of employees working overtime (76%), followed by real estate, professional and business services (both at 73%) A survey of 208 workers conducted by the Retail, Commerce and Clothing Industries General Union of the Hong Kong Confederation of Trade Unions in Q % of the respondents worked more than 11 hours a day 60% of the respondents had to work overtime regularly 83% of the respondents from the financial sector had to work 5 hours of overtime per day 11 HR Practices to Offer Employee Wellness and Work-life Balance Type leaves catered for family needs flexible work arrangements daily life support Example marriage leave, maternity leave, paternity leave, compassionate leave, carer s leave and no pay leave five-day work week, flexible working hours, home office, job sharing child care, counseling services, medical protection, family day, employee assistance programme community participation family-friendly employment policies volunteer work end-of-year trips, social gatherings, special family engagement events 12 HKIHRM 6

7 Latest Developments of Standard Working Hours 13 Government s Standard Working Hours Committee The government announced the formation of the Standard Working Hours Committee in April The Committee will focus on SIX major areas: 1) Objective 2) Flexibility 3) Possibility of leading to more part-time and casual workers 4) Impact on small- and medium-sized enterprises and different business sectors 5) Working modes of different sectors 6) Legislative direction It is expected to submit a report to the government at the end of its three-year term. 14 HKIHRM 7

8 Government s Standard Working Hours Committee (con t) Chairperson Non-official Members Members of the Labour Advisory Board as ex-officio members Members who are public officers Dr Leong Che-hung Ms Susanna Chiu Lai-kuen Professor Chong Tai-leung Mr Lau Chin-shek Dr Kevin Lau Kin-wah Dr Jane Lee Ching-yee Professor Joe Leung Cho-bun Mr Ma Ho-fai Professor Raymond So Wai-man (Employee Representatives) Mr Leung Chau-ting Mr Chung Kwok-sing Mr Lee Tak-ming Mr Ng Chau-pei Mr Chau Siu-chung Ms Chan So-hing (Employer Representatives) Mr Ho Sai-chu Dr Kim Mak Kin-wah Mr Stanley Lau Chin-ho Mr Irons Sze Mr Emil Yu Chen-on Mr Thomas Ho On-sing Permanent Secretary for Labour and Welfare Commissioner for Labour Government Economist 15 Report of the Policy Study on Standard Working Hours The government released the Report of the Policy Study on Standard Working Hours in November The study selected 12 places, including Singapore, Korea, Japan, mainland China, Macau, Taiwan, Australia, the European Union, the United Kingdom, Belgium, the United States and Canada, and focused on five essential components of standard working hours: a) Standard or maximum working hours limit b) Overtime limit and overtime pay c) Exemptions d) Flexibility arrangements e) Rest period 16 HKIHRM 8

9 Report of the Policy Study on Standard Working Hours (con t) Some major findings of the report: additional labour costs at $8 billion to $55.2 billion a year, or 1.7% to 11.4% of total expenditure on wages 1.32 million to 2.38 million workers will be affected if standard working hours are set at 48 or 40 hours a week Hongkongers work 47 hours a week on average. Of the 2.81 million workers in the city, 23.4% have worked overtime but only 51.8% of them have been paid for the extra time either by paid overtime or time-off in lieu. Others had uncompensated overtime 17 Views on Standard Working Hours Major Issues of Concern: Legislated standard working hours needed? Number and limit of standard working hours Exemptions Limit on overtime work and overtime pay Opt-out provision for overtime protection 18 HKIHRM 9

10 Standard Working Hours HKIHRM Survey Results Key findings of an HKIHRM survey conducted in October 2011 covering 95 companies with a total of some 148,000 employees: Introduction of Standard Working Hours 54% of respondents did not think standard working hours should be introduced in Hong Kong, while 46% supported. Number and Limit of Standard Working Hours 49% of respondents agreed and proposed the average number of working hours for different positions to be ranging from 42.7 hours to 54 hours per week. Exemption from Legislation 61% of respondents thought that one or more positions should be exempted from legislation. 19 Standard Working Hours HKIHRM Survey (con t) Maximum Overtime Hours and Overtime Rate 48% of respondents agreed a monthly limit should be set on the maximum overtime hours allowed for office staff, and 49% of respondents agreed on same arrangement for jobs with irregular working hours. 53% of respondents expressed that overtime rates should be agreed upon between the employer and the employee rather than being stipulated by law. Opt-out of overtime protection 50% of respondents thought that employees should not be allowed to opt out of overtime protection, ie receive less than the statutory overtime rate or work more overtime hours than what is mandated. 20 HKIHRM 10

11 Standard Working Hours Public Opinions Employee VS Employer The Confederation of Trade Unions said according to its studies, the rise in labour costs would be only 4.5% as long as the law did not apply to management, who earned more than the general workforce. Besides, studies in other countries show the positive impact of such a law - a better sense of belonging among workers, lower turnover rate and less sick leave. (Source: South China Morning Post, 4 Apr 2013) Seven business chambers sent a joint letter to the government, warning that legislating standard working hours would hurt the commercial environment and the city s steady and robust economic growth. (Source: Ming Pao Daily, 23 Nov 2012) The Business and Professionals Alliance for Hong Kong estimated that smalland medium-sized enterprises would have to pay an extra $30 billion each year in salary if standard working hours is stipulated, 54.2% more than the $21.4 billion estimated by the government. (Source: Hong Kong Economic Journal, 14 Feb 2013) 21 Standard Working Hours Public Opinions (con t) Employee VS Employer A survey released by the Retail, Commerce and Clothing Industries General Union of the HK Confederation of Trade Unions found that 95% of the respondents supported the legislation of standard working hours. (Source: Apple Daily, 18 May 2013) The HK Business Community Joint Conference said a limit on working hours before overtime has to be paid goes against the city s free-market principles business costs will increase significantly and the competitiveness of small- and mediumsized companies will be weakened. (Source: South China Morning Post, 4 Apr 2013) A Labour Advisory Board employer representative said overtime pay at 1.5 times may not be beneficial to the employees. When employees work overtime with the intention to earn more money, such move would be contrary to the intention of introducing standard working hours, ie to enable better work-life balance. (Source: Hong Kong Economic Journal, 8 May 2013) 22 HKIHRM 11

12 Possible Impact of Standard Working Hours (HR perspective) Manpower Deployment Cost Factor Complexities in Employee Relations Employee Wellness 23 Manpower Deployment Corporations may have to re-arrange work schedules, or to hire more part-time staff to ensure smooth business operations. 24 HKIHRM 12

13 Manpower Deployment (con t) Some sectors and occupations will experience greater impact: - professions with high and low seasons (eg accountants and auditors) - with special business patterns (eg investment bankers and wealth management professionals, creative professionals) - labour-intensive sectors with high and low seasons (eg retail, catering, hotel, real estate, tourism and logistics) - non-governmental organisations which provide youth support and elderly services - positions with field work 25 Cost Factor Operation costs will increase because of pay for over-time work and wages for part-timers. More administrative costs will be expected for monitoring employees working hours, as well as tracking overtime hours and calculating overtime pay. Businesses not able to absorb the full cost may pass the cost burden to the consumers of their products and services. 26 HKIHRM 13

14 Complexities in Employee Relations Exemptions from legislation - Will job categories exempted from the protection of standard working hours be regarded as less favourable by job-seekers? - Will this cause further shortage in some sectors and further complicate the manpower mismatch we are now experiencing? Handling of overtime work - Under what circumstances will overtime work be approved? - What should be done by employees to prove that overtime work is necessary? - What will be the burden on supervisors for approving and monitoring overtime work? - Will the issue of paid overtime work lead to employee relations challenges? 27 Employee Wellness Could legislating overtime pay be a deterrent to current efforts in educating employers to adopt work-life balance measures? Would some employers come under the impression that, as long as they pay the mandated overtime pay, they could demand their employees to work more overtime? Could it be that some employees, in satisfying their financial planning, find the overtime pay rate so attractive that they put work-life balance lower on their list of priorities? 28 HKIHRM 14

15 HKIHRM s Views on Standard Working Hours Government conduct appropriate manpower planning studies and propose comprehensive measures to solve the manpower problems in Hong Kong, including labour shortage and skill mismatch; conduct studies on manpower needs of different sectors, particularly those facing severe labour shortage; then formulate appropriate measures to address the issue, including but not limited to appropriate importation of talent to address gaps identified; 29 HKIHRM s Views on Standard Working Hours (con t) Government (con t) subsidise or provide tax incentives to employers to support family-friendly initiatives such as providing child-care facilities in co-operation with non-governmental organisations, thus attracting more housewives to enter the job market; take proactive measures to consider ways to enhance productivity in terms of thinking process and operational effectiveness by related government department or organisation; 30 HKIHRM 15

16 HKIHRM s Views on Standard Working Hours (con t) Government (con t) take measures to capitalise on the potentially available workforce, including: - housewives (who are suitable for part-time jobs or working flexi hours) - the socially withdrawn hidden youth who lack the experience and confidence to pursue a career - the silver-hair group (many are still mentally and physically fit for employment, and can play the role of consultants, this can be done by delaying the retirement age and relaxing age-related employee benefits, such as MPF) 31 HKIHRM s Views on Standard Working Hours (con t) Government (con t) agree on views of Mr Jon Messenger, Senior Research Officer of the International Labour Organisation, that a social dialogue should be initiated and conducted by the government. Effective social dialogue requires: Government leadership Strong social partners (employers associations & labour unions) An inclusive approach that recognises views of other key stakeholders in the community and gives them a voice A willingness to openly discuss the concerns of all of the key stakeholders A willingness to compromise on difficult, contentious issues: this takes time, effort and leadership 32 HKIHRM 16

17 HKIHRM s Views on Standard Working Hours (con t) Enterprise Irrespective of their size, enterprises could first try to adopt work-life balance or family-friendly practices which can help retain staff without sacrificing productivity. Examples of such practices include flexible working hours, work from home and job-sharing. 33 HKIHRM s Views on Standard Working Hours (con t) Mindset changes Eliminate presenteeism, a phenomenon that employees are present in the office, but mentally and/or physically unwell and therefore not working to their full capability; the tendency to stay at work beyond the time needed for effective performance on the job. 34 HKIHRM 17

18 HKIHRM s Views on Standard Working Hours (con t) Mindset changes (con t) Address expectation mismatch, the belief that the younger generation or the well-educated should not take up manual or vocational work. Address parenting. Parents who are very protective towards their children should be educated to understand that work is one kind of life experiences, which is important for the personal growth, maturity and independence of their children. 35 Conclusion Hong Kong s success is partly built on a flexible and highly competitive labour market. To sustain its competitive advantage, the city has to strike a balance between talent competitiveness and employee rights. To establish a widely acceptable mechanism without subsequent disputes between employers and employees will be a major test to all stakeholders. 36 HKIHRM 18

19 Conclusion (con t) If standard working hours is chosen as a solution to address long working hours and a lack of work-life balance in Hong Kong, a consensus should be reached after a large-scale social dialogue among all the stakeholders including the government, employers, employees, professional bodies, academic institutes, non-governmental organisations and so on. The pre-requisite of introducing standard working hours is that there should be no interruption to operation, or sacrifice to quality and productivity, or negative effect on employee relations and the Hong Kong community. 37 Thank You 38 HKIHRM 19