LegCo Paper No. CB(1)358/96-97
(These minutes have been seen by the Administration)
Ref : CB1/PL/MP/1

LegCo Panel on Manpower

Minutes of special meeting held on Friday, 1 November 1996 at 11:00 a.m. in the Chamber of the Legislative Council Building

Members present :

Members absent :

Public officers attending :
Item I

Mr Matthew K C CHEUNG, JP: Deputy Secretary for
Education and Manpower
Mr Tony Reynalds: Principal Assistant Secretary for Education and Manpower

Item II

Miss Esther LEUNG: Acting Principal Assistant Secretary
for Education and Manpower
Mr TSANG Kin-woo: Assistant Commissioner for Labour

Clerk in attendance :

Miss Polly YEUNG

Chief Assistant Secretary(1)3

Staff in attendance :

Ms Connie SZE-TO

Senior Assistant Secretary(1)5

I.Outcome of public consultation on discrimination in employment on the ground of age

II. Briefing on legislative proposal

1. Since no quorum was present, members agreed that the meeting would proceed as an informal meeting. The Chairman directed that the meeting would discuss the second item on the agenda first.

I.Outcome of public consultation on discrimination in employment on the ground of age

(LegCo Paper No. CB(1)178/96-97(04), LegCo Brief Ref: EMBCR 1/3231/95 IX)

2.2 At the Chairmans invitation, Mr Matthew CHEUNG briefed members on the outcome of the public consultation exercise on age discrimination in employment and the way forward for dealing with the issue. He advised that the Administration had decided not to proceed with the legislative approach for the present but would introduce a sustained programme of publicity, public education and self-regulation.

3. Responding to the Chairmans enquiry about the number of submissions expressing objection to the legislative option, Mr CHEUNG undertook to provide the Panel with a detailed breakdown on the 11 submissions which indicated support for public education. On the 25 submissions which supported the legislative option, Hon James TIEN requested the Administration to provide information on the number of submissions from employer groups, if any, which expressed support for this option.

(Post-meeting note: The breakdown on the 11 submissions for public education was circulated to members vide LegCo Paper No. CB(1)268/96-97)

EMB

4.4 While recognising the importance of publicity and education, Hon LEUNG Yiu-chung queried the Administrations rationale for deferring consideration of the legislative option. He opined that legislation on age discrimination in employment would provide sanctions against discrimination and help to bring about attitudinal change in the community towards employing older persons. Considering the problem of age discrimination in employment pressing and most common in sales/service-oriented occupations, he urged the Administration to conduct independent and objective surveys on an occupational basis to gauge the problem instead of deciding the way ahead purely with reference to the results of the public consultation exercise.

In response, Mr CHEUNG made the following points:

The Administration had not ruled out the legislative option. After considering public views expressed and overseas experience, it had decided to adopt a more prudent approach to first launch an extensive programme of publicity, public education and self-regulation to deal with the matter. The effectiveness of the programme would be reviewed after implementation for a reasonable period of time and the need for legislative measures would then be examined in deciding the way forward.
The public consultation paper was prepared having regard to the findings of the Administrations surveys, the fact-finding visit to Australia and New Zealand, as well as an independent survey conducted by a tertiary institution. Little evidence of pure age discrimination by employers due to personal prejudice had been found. Although no detailed study on an occupational basis had been carried out, the three surveys on newspaper job advertisements undertaken by the Labour Department (LD) revealed that over 80% of the advertisements did not mention age as a job requirement.
The relatively low response rate to the public consultation paper also suggested that age discrimination in employment was not a pressing issue to the community.

6. On the appropriateness of legislative measures, Hon James TIEN stressed that the issue must be approached with great care. Before contemplating the legislative approach, reference should be made to overseas systems, especially neighbouring Asian countries to which Hong Kong should be broadly comparable. He was concerned about possible over-regulation which would deter foreign investment and undermine Hong Kongs competitiveness.

7. Sharing the members concern, Mr CHEUNG explained the Administrations views as follows:

It was apparent that discrimination on the ground of age was not considered as such a serious human rights issue as illustrated by the fact that it was not one of the common forbidden grounds in international instruments and a significant number of countries, including the European Community countries, Japan, the Republic of Korea and Singapore did not have specific age discrimination legislation.
Actual experience in some overseas countries had indicated that legislation against age discrimination in employment was not as effective as expected and would neither create nor guarantee jobs. Moreover, there was a real risk of over-regulation and unnecessary litigation. The legislative approach therefore might not work in the interest of employees.
It was very clear from the visits to Australia and New Zealand that legislation was not regarded as a substitute for public education. The Administration considered that for the time being, publicity and education would be a more prudent and effective option in bringing about changes in attitude and perception towards equal opportunities in employment.

8. In reply to members enquiries about the publicity, public education and self-regulation programme, Mr CHEUNG advised that a working group established under the Education and Manpower Branch had been entrusted with the task. The programme was expected to commence in early 1997 and the strategy would be worked out very soon. The proposed programme would be substantive and sustained, and consist of promotional and educational activities catering for various sectors of the community. Non-statutory guidelines for employers on how to deal with recruitment and employment issue in a non-age-discriminatory manner would be drawn up following full consultation with employer and employee groups. The Administration was aware of the importance of tripartite participation from employers, employees and the Administration in implementing the programme in order to achieve its objectives and would enlist the support from all parties concerned.

9. The Chairman pointed out that legislation on age discrimination in employment in the USA apparently had no adverse impact on its economy. Summing up the discussion, the Chairman said that since the Administration had taken the non-legislative option, he would proceed with his Members Bill on equal opportunities covering family responsibility, sexuality and age which was now awaiting scrutiny by a Bills Committee.

II. Briefing on legislative proposal

Employment (Amendment) (No.4) Bill 1996 - Members Bill by Hon LEUNG Yiu-chung

(LegCo Paper No. CB(1) 178/96-97(02) and (03))

10. Since this was an informal meeting, members discussed whether the briefing on the Bill should proceed. Members noted that a Bills Committee had been set up to study the Bill and in order to exchange preliminary views with the Administration, it was agreed that the briefing should proceed and the notes of discussion would be circulated to Panel members for reference.

11. Upon invitation by the Chairman, Hon LEUNG Yiu-chung highlighted the following salient points of his Members Bill:

The object of the Bill was to amend the definition of lay-off under the Employment Ordinance (EO). According to existing provisions, an employee was taken to be laid off and with two years service, would be entitled to claim severance payment (SP) if the employer failed to provide work or pay on more than half of the total number of normal working days in a period of four consecutive weeks or on more than one-third of the total number of normal working days in a period of 26 consecutive weeks. The Bill proposed that the period of under-provision of work be reduced to one-third and one-fourth for the four-week and 26-week work period respectively.
The Bill aimed at increasing protection for workers, particularly those low-wage earners in the manufacturing industry, to provide them with a reasonable income during a long period of under-provision of work; and to deter employers from evading their obligation to pay SP by providing insufficient work for a prolonged period in an attempt to force workers to resign on their own accord.
Under-provision of work in excess of the statutory requirement per se was not a prosecutable offence under the EO. However, it would trigger off a lay-off situation which would give rise to a right to claim SP. In practice, subject to mutual consent between the employer and the employee, the latter might choose not to exercise his right in which case his employment could continue despite the excessive under-provision of work.

12. The Chairman and some members observed that the arrangement mentioned in para. 11(c) had not been explicitly stated in the Bill and they expressed reservation on whether such an arrangement , which might have the effect of reducing an employees rights, was permissible under the EO.

13. Responding to members enquiries, Mr TSANG Kin-woo provided the following clarifications:

Under the EO, any term in an employment contract which sought to provide a lower level of benefits would be void.
Under existing provisions of the EO, an employee with not less than two years service was entitled to claim SP from the employer under certain situations including lay-off. The LD would remind the employee of his right to claim SP when a lay-off situation arose. In the event of a legitimate claim and an employer who without reasonable excuse failed to pay SP would commit an offence under the EO, the maximum penalty for which was a fine of $100,000 upon conviction.
In case the employee forfeited his right to claim SP and continued working for his employer despite the under-provision of work, it might be difficult for the Administration to take out prosecution against the employer for failure to pay SP because the employee concerned would probably decline to act as prosecution witness.

14. In explaining the Administrations views on the Bill, Miss Esther LEUNG and Mr TSANG made the following points:

It had been a well-established practice of the Government to draw up legislative proposals on the basis of consensus reached through tripartie discussion amongest employers, employees and Government at the Labour Advisory Board (LAB). The Administration would not support the Bill as it had not gone through this process of tripartite consultation.
The existing lay-off provisions under the EO had assured employees with work or pay for at least two-thirds of the total number of working days in any consecutive period of 26 weeks when there was insufficient work for them to do. Employers were also given sufficient flexibility to tide over difficult periods without having to dismiss their workers. Hence a reasonable balance was struck between the interests of employees and employers.
The Bill would incur additional labour costs to employers and might force them to scale down or even cease their business at times of economic downturn. This would jeopardise the overall employment opportunities for workers.
The Administration would be proposing amendments to the EO to protect employees against unreasonable dismissal and unreasonable variation of contract by employers. Deliberate prolonged under-provision of work by employers might constitute an unreasonable variation of contract for which terminal compensation including SP was payable.
The Law Reform Commission was also exploring legislative proposals under which employers with financial difficulties could seek to retain their staff without having to dismiss them.

15. Members held different views on the Bill. Hon James TIEN expressed concern that the Bill might increase the financial burden of small employers and accelerate the closing down of their business during difficult periods. He urged that the LAB should be consulted on the Bill so that employer and employee groups could have an opportunity to discuss the proposal. Hon CHEUNG Man-kwong commented that the additional labour costs to be borne by employers appeared to be marginal. While he disagreed that only those legislative proposals endorsed by the LAB would merit support, he suggested that when scrutinising the Bill in due course, the Bills Committee should also invite both employer and employee groups to give their views. Concluding the discussion, the Chairman suggested that as the Bills Committee was yet to commence work, Mr LEUNG could give further thought to members comments and consult the parties concerned if necessary.

16. The meeting ended at 12:30 p.m.
Legislative Council Secretariat
19 November 1996

Last Updated on 21 August 1998