Labour organisations and unions in Hong Kong are calling for a yearly assessment of the minimum hourly wage, which was raised from HK$37.5 to HK$40 on Monday after a four-year freeze.

Hot weather heatwave waterfront street cleaner blue collar
A street cleaner. File photo: Lea Mok/HKFP.

Labour Secretary Chris Suen said on Facebook on Labour Day that a report evaluating the minimum wage review system will be submitted by the Minimum Wage Commission by the end of October. The government will then decide the future direction of the system and make announcements as soon as possible, he added.

On January 10, Chief Executive John Lee and the Executive Council accepted a proposal to increase the city’s minimum wage to HK$40. In a Monday Facebook post, the city’s leader said he wished to pay tribute to all workers for their hard work and contribution to the country and society, adding that the latest 6.7 per cent increase was among the many policies laid out in his Policy Address to improve worker welfare.

However, a number of NGOs and labour rights groups said the HK$2.5 increase was not sufficient considering the inflation rate over the past four years. They included the Society for Community Organisation (SoCO), the League of Social Democrats (LSD), Hong Kong Labour Rights Monitor (HKLRM), as well as the pro-establishment Hong Kong Federation of Trade Unions (HKFTU).

Chris Sun
Secretary for Labour and Welfare Chris Sun. Photo: Kyle Lam/HKFP.

The groups also called for the minimum wage review to be conducted annually instead of every two years.

Accumulated inflation rate of 7.5%

HKLRM said in its statement that the 6.7 per cent wage increase was less than the accumulated inflation rate over the past four years of 7.5 per cent, according to figures released by the Census and Statistics Department.

“What can HK$40 buy? A McDonald’s meal set? About 150 grams of pork? One sixth of a Disneyland ticket?” the organisation asked on Facebook.

The Director General of Oxfam Hong Kong, Kalina Tsang, said the revised minimum wage was low, and employees’ basic needs were not taken into account in a holistic manner.

The NGO encouraged employers in the financial hub to pay a “living wage” – a salary rate that ensures employees are able to live decent lives – which was found to be at least HK$60.10 this year. It urged the government to promote the concept of a living wage on top of the minimum wage.

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File Photo: Lea Mok/HKFP

Anti-poverty NGO SoCO said it was extremely disappointed with the increase as it showed that the authorities “were not determined to enhance labour protection.”

The labour advocacy group added that since the minimum wage was launched in 2011, the accumulated increase over the past 12 years was 42.9 per cent while that of the overall labour market was 48.5 per cent. This reflects that the minimum wage has not kept up with the market, SoCO said.

Review mechanism

While pro-establishment labour unions, the HKFTU and Federation of Hong Kong and Kowloon Labour Unions (HKFLU) both agreed that the HK$40 minimum wage should be reviewed annually, the HKFTU suggested that the authorities refer to the MTR fare review mechanism.

Hong Kong’s largest pro-Beijing party, the Democratic Alliance for the Betterment and Progress of Hong Kong (DAB), proposed using the hourly rate of the lowest-earning 10 per cent of workers in the market as a reference point for the minimum wage. This, they argue, would eliminate the need for yearly reviews.

According to its website, the Minimum Wage Commission aims to “maintain an appropriate balance” between “forestalling excessively low wages and minimising the loss of low-paid jobs,” as well as sustaining Hong Kong’s competitiveness.

Correction 3.5.23: A previous version of this article incorrectly converted “four taels of pork” to “a quarter gram of pork.” The correct conversion should be about 150 grams. We regret the error.

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Lea Mok is a multimedia reporter at Hong Kong Free Press. She previously contributed to StandNews, The Initium, MingPao and others. She holds a bachelor's degree in Journalism from the Chinese University of Hong Kong.