Panel on Manpower (Minutes) 23 Feb 98

Provisional Legislative Council

PLC Paper No. CB(1)1152
(These minutes have been
seen by the Administration)

Ref : CB1/PL/MP

Panel on Manpower

Minutes of meeting held on Monday, 23 February 1998, at 2:30 pm in the Chamber of the Legislative Council Building

Members present :

Hon CHAN Kam-lam (Chairman)
Hon Mrs Sophie LEUNG LAU Yau-fun,JP(Deputy Chairman)
Hon James TIEN Pei-chun, JP
Hon HO Sai-chu, JP
Hon LEE Kai-ming
Hon Henry TANG Ying-yen, JP
Hon Ronald ARCULLI, JP
Dr Hon Mrs TSO WONG Man-yin
Hon MOK Ying-fan
Hon CHAN Yuen-han
Hon CHAN Wing-chan
Hon Bruce LIU Sing-lee
Hon Ambrose LAU Hon-chuen, JP
Hon CHENG Yiu-tong
Dr Hon LAW Cheung-kwok
Hon TAM Yiu-chung, JP

Members absent :

Hon WONG Siu-yee
Hon Mrs Peggy LAM, JP
Hon Frederick FUNG Kin-kee
Dr Hon Philip WONG Yu-Hong

Public officers attending :

Mr Joseph W P WONG: Secretary for Education and Manpower
Miss J A Willis: Commissioner for Labour
Mr Matthew CHEUNG: Deputy Secretary for Education and Manpower
Ms Esther LEUNG: Principal Assistant Secretary for Education and Manpower
Mrs Jennie CHOR: Assistant Commissioner for Labour (Special Duties)
Mr M C LEUNG: Assistant Commissioner for Labour (Employment Services)
Mr K Y TANG: Government Economist

Clerk in attendance :

Miss Polly YEUNG: Chief Assistant Secretary (1)3

Staff in attendance :

Ms Sarah YUEN: Senior Assistant Secretary (1)4

I.Confirmation of minutes of meeting and matters arising

(PLC Paper No. CB(1)967)

1.The minutes of the meeting held on 21 January 1998 were confirmed.

II.Date and items for discussion for next meeting

2. Members agreed to discuss the review on proposed arrangements for General Holidays at the next regular meeting to be held on Monday, 23 March 1998, at 2:30 pm. They also agreed that they would notify the Chairman or the Clerk after the meeting should they wish to propose other discussion items.

3.Members noted that a draft report giving an account of the work of the Panel during the term of the Provisional Legislative Council would be tabled at the March meeting for members endorsement before submission to the Council in accordance with Rule 77(14) of the Rules of Procedure.

III.Information papers issued since last meeting

(PLC Paper Nos. 859 and 924, and the code of practice on industrial diving circulated to all PLC Members by general despatch)

4.Members noted that two information papers and the code of practice on industrial diving had been issued for their general information since the last meeting.

IV.Measures to tackle the unemployment problem

(Information package from the Administration tabled at the meeting and circulated to all PLC Members thereafter by general despatch)

5.The Secretary for Education and Manpower (SEM) briefed members on the package of new and additional measures being undertaken by the Government to help the unemployed to find jobs, receive retraining and reskill themselves.

The package

6.While agreeing that there was no immediate solution to unemployment, some members opined that the package, built upon existing practices only, was to a large extent cosmetic in nature and could offer very little assistance. They pointed out that the current economic recession was affecting not only the employment opportunities of the lower stratum of Hong Kong's workforce but also the middle class. The members reiterated the need for more effective and proactive measures to tackle unemployment.

7.Stressing that the Administration was genuinely committed to addressing the unemployment problem, SEM said that there were new initiatives in the package. For example, the Administration would ensure that efficient employment service and updated information on employment opportunities and training would be provided to the unemployed by co-ordinating the services of all relevant agencies. A grant of $80 million would be made to the Construction Industry Training Authority (CITA) to expand its short-term programmes by 50 percent. The Administration had also proposed to extend the duration of certain tailor-made retraining courses to ensure that trainees would be equipped with the necessary skills to secure placement and stay competitive in the workforce.

8.On improving information on services available to the unemployed, the Administration reported that it had been liaising actively with various training bodies and employer groups for the provision of updated information so that the leaflet on training and major job vacancies produced by the Administration could be updated on a monthly basis.

9.As regards the matching of job vacancies with the unemployed, members noted that the recent meeting between SEM and employer groups had resulted in agreements on better co-ordination and collation of information on job vacancies for dissemination to job-seekers through the Labour Department (LD).

10.In this connection, the Commissioner for Labour (C for L) supplemented that following computerisation of the nine branch offices of the LD's Local Employment Service, the employment and guidance centre for new arrivals and the Job Matching Centre, a centralised computerised database on job vacancies and job-seekers had been built up to enable the LD to strengthen its job matching and placement service. In reply to a member, C for L advised that LD's placement rate in 1997 was over 22%. She also reported that in line with past seasonal trend, there was a drop in the number of job vacancies in January 1998 (i.e. the period around Chinese New Year) but the number of job-seekers during this period had remained stable.

11.Elaborating on the fostering of a closer relationship amongst employers, training bodies and the Government to improve training and retraining programmes, SEM reported that the Administration had requested employers to identify categories of long-term job vacancies for which specially tailor-made retraining programmes and/or on-the-job training programmes could be organised by the Employees Retraining Board (ERB). As a further step forward to minimise mismatch, the Administration was also liaising with trade associations to co-organise courses to ensure that trainees would meet the employers requirements and that the courses concerned would be formally recognised by employer groups. Members also noted that the quadrilateral Working Group on Training and Retraining for the Construction Industry (the Quadrilateral Working Group) would see to it that various training bodies would suitably adjust their current training and retraining programmes to meet market needs and the employment situation. To further ensure that training courses could respond to market needs, the Administration was considering providing some incentives to employers taking part in training programmes, and funding training courses according to the placement rate of their participants.

12.On the provision of intermediate trade tests for construction workers, a member proposed that the Administration should adopt a "one-stop shop" approach as well as waive test fees to encourage participation. In response, SEM and the Deputy Secretary for Education and Manpower (DS/E&M) explained that the charging of fees was necessary to prevent abuse and those who had difficulty in paying the fees could apply for a waiver. Moreover, the tests were already heavily subsidised and the charging of a fee of $100 fell far short of recovering the cost. The Administration nevertheless agreed to relay the member's proposal for further consideration by the Quadrilateral Working Group which would monitor the provision of the tests and consider how the grant of $80 million to CITA would be used.

13.In response to a member's comments on measures taken against age discrimination in employment and her call for legislation, SEM reiterated the Administration's policy stance of relying on public education, publicity and self-regulation at the present stage for dealing with the problem. Pointing out that the Administration had not ruled out the legislative option in the long run, he referred members to the "Practical Guidelines for Employers on Eliminating Age Discrimination in Employment" recently published and urged members to allow time for the Administration to assess the effectiveness of such efforts before deciding the way forward.

The unemployment situation

14. Members held different views on the current unemployment situation. While some members found the unemployment rate of 2.5% worrying, some members opined that the figure was far from alarming by international standards.

15.At members request to size up the unemployment situation, SEM and the Government Economist (GE) emphasised that in a free market economy like that of Hong Kong, the labour market was substantially linked to the economic climate. However, given that Hong Kong's economy could not stay free of fluctuations in the regional economy, there was not much Hong Kong could do to improve the macro situation apart from allowing a period of adjustment for recovery to take place. According to the Administration, the key for adjustment was flexibility and hence, employers and employees were called upon to co-operate with each other to ride out the economic storm. GE cautioned that unless the overall economy of Hong Kong improved, further rise in unemployment would be inevitable. The problem might be exacerbated by the growing number of returnees and new immigrants seeking jobs which boosted the supply side in the labour market without a corresponding increase in demand. Nonetheless, SEM assured members that there would be a high demand for labour in the building and construction industry as a result of the Government's commitment to build 85,000 flats a year and the implementation of related infrastructural projects. With the introduction of more stringent building management and maintenance laws, the demand for building management personnel was expected to rise.

Financial incentives

16.Where financial incentives were concerned, members agreed that reduction in rates and profits tax introduced in the recently announced Budget for 1998-99 might help to stimulate the economy and help employers tide over the current crisis. However, some members opined that there was a need for more such incentives to promote business growth. In response, GE pointed out that the Budget had already put forward a number of measures to nurture a more favourable economic environment. As for financial incentives aimed at helping workers, SEM advised that the Administration was considering providing retraining allowance to retrainees serving apprenticeship.

Legislative measures

17.Some members felt that during difficult times, employers were inclined to dismiss their employees for saving costs. They maintained that there was a need for more stringent labour laws to deter unscrupulous employers from unreasonable variation of employment terms, unnecessary lay-offs and unfair dismissal of employees. They also called for mandatory reinstatement in deserving cases. Other members, however, stressed the need to allow employers the flexibility to make necessary adjustments in the mutual interests of employers and employees. In these members view, the most important task at present was to keep business in operation and hence, workers in their jobs. Too much government intervention in the form of legislation would only prove counter-productive in preserving or creating job opportunities. They further pointed out that the only solution to unemployment was an upturn in the economy. As such, labour importation in cases where local workers were genuinely not available to fill the vacancies should be allowed to facilitate business growth and in turn, sustain the economy. In this regard, these members urged the Administration to retain the Supplementary Labour Scheme (SLS).

18.Commenting on the proposal to tighten labour laws, SEM and GE emphasised that in a free market economy, the Government should refrain from excessive intervention into the labour market. They cautioned that great care had to be exercised in imposing legislative measures so as not to be perceived as seeking to regulate business decisions and private employment relationship. Responding to members concerns, SEM confirmed that the Administration had urged employer bodies not to resort to lay-offs too readily.

19.Responding to other comments made by members, representatives of the Administration made the following points -

The Administration had already undertaken to review the provisions on re-instatement under the Employment (Amendment) (No. 3) Ordinance 1997 after it had come into effect for one year.
Amendments to employment terms, if agreed to by both parties, were permissible. Unilateral variation of such terms to the detriment of the employee, however, was null and void under law. The LD had reminded employees through the mass media that they should examine the new terms before signifying agreement.
Review on the SLS had been completed and the Labour Advisory Board had agreed that the Scheme should continue.

Promotion of a better link between training and job placement

20.Members stressed the need for better links and co-ordination between the employment assistance offered by LD and the provision of training and retraining services. The Deputy Chairman, in particular, highlighted the importance of identifying displaced workers career preferences in providing retraining to them. In response to members, DS/E&M advised that there would be a meeting between the ERB, the training bodies and the relevant departments in the near future to map out measures to strengthen links. C for L also emphasised that there was already a close working relationship between the LD and ERB in assisting workers to find jobs and receive relevant retraining.

Other concerns

21.In response to a member's call to step up action against illegal employment, the Administration assured members that while the Immigration Department was responsible for the enforcement of relevant legislation, LD would provide the necessary assistance such as in supplying the Department with information on illegal labour gathered from site inspections. Noting that the issue had just been discussed by the Security Panel, the Chairman suggested that the relevant papers and minutes should be circulated to Panel members.

22.On measures to reduce wastage in a particular trade, a member urged the Administration to assure new entrants to a trade of the career prospect and the opportunities for upward and lateral career developments. Her points were noted by the Administration.

23.A member questioned the need for preparing an English version of the Employment and Training Guide. In response, SEM explained that it was the Government's standing practice to produce all information leaflets and brochures for public distribution in bilingual form. Furthermore, it served a practical purpose for the non-ethnic Chinese Hong Kong residents and the foreign media.

24.SEM assured members that the package would be a long-term undertaking geared to helping the unemployed to rejoin the labour market as soon as possible. He also undertook to report progress of the package and further new initiatives to the Panel regularly.

25.The meeting ended at 4:20 pm.

Provisional Legislative Council Secretariat
11 March 1998