WEDNESDAY, JUNE 1, 1977
CONTROVERSIAL SEVERANCE PAY BILL PASSED
****
THE EMPLOYMENT (AMENDMENT) (NO.2) BILL 1977, WHICH PROVIDES HIGHER RATES OF SEVERANCE PAY TO EMPLOYEES WHO ARE LAID OFF, WAS PASSED BY THE LEGISLATIVE COUNCIL TODAY.
THE AMOUNT OF SEVERANCE PAY FOR EACH YEAR OF SERVICE WILL BE INCREASED FROM ONE-THIRD TO HALF OF A MONTH'S PAY FOR MONTHLY-RATED EMPLOYEES, AND FROM 10 TO 13 DAYS' WAGES FOR THOSE WHO ARE TIME OR PIECE-RATED.
THE PERIOD OF CONTINUOUS SERVICE TAKEN INTO ACCOUNT FOR CALCULATION WILL ALSO BE INCREASED FROM FIVE TO EIGHT YEARS BEFORE AUGUST 23, 1974.
FIVE UNOFFICIAL MEMBERS SPOKE IN SUPPORT OF THE BILL AND ONE VOTED AGAINST IT.
SPEAKING IN SUPPORT OF THE BILL, DR. THE HON.
S.Y. CHUNG SAID THAT UMELCO HAD RECEIVED A NUMBER OF OPPOSING REPRESENTATIONS FROM EMPLOYERS' ASSOCIATIONS AND GROUPS INTERESTED IN LABOUR MATTERS DURING THE PAST FEW WEEKS.
THE EMPLOYERS' ASSOCIATIONS, HE SAID, PARTICULARLY THOSE IN THE TEXTILES, GARMENT, PLASTIC AND RUBBER INDUSTRIES, WERE VOICING VERY STRONG OBJECTION AGAINST THE BILL.
+ONE OF THEIR MAIN CONCERNS IS THE LARGE INCREASE OF CONTINGENT LIABILITY BY OVER 100 PER CENT OVERNIGHT.
+ANOTHER MAJOR CONCERN OF THE EMPLOYERS' ASSOCIATIONS IS THE FAST CONTINUING INCREASE OF CONTINGENT LIABILITY IN FUTURE YEARS, HE ADDED.
THE INCREASED CONTINGENT LIABILITY WOULD RESULT FROM TWO FACTORS, DR, CHUNG EXPLAINED.
+THE FIRST FACTOR IS OBVIOUSLY THE INCREASING NUMBER OF YEARS OF COMPANY SERVICE AND THE SECOND THE CONTINUAL TREND OF RISING WAGES,+ HE SAID, AND IT COULD NOT BE DENIED THAT SUCH INCREASES OF CONTINGENT LIABILITY YEAR AFTER YEAR WAS NOT INSIGNIFICANT.
+HOWEVER, WE MUST NOT OVERLOOK THE PRACTICAL ASPECTS OF THE MATTER, FIRSTLY, THIS IS ONLY A CONTINGENT LIABILITY. NO SEVERANCE PAYMENT IS REQUIRED UNTIL AN INDUSTRIAL UNDERTAKING IS CLOSING DOWN OR REDUCING ITS LABOUR FORCE.
+SECONDLY, DUE TO VERY HIGH MOBILITY OF LABOUR IN HONG KONG, THE AVERAGE LENGTH OF SERVICE OF INDUSTRIAL WORKERS IN A GIVEN INDUSTRIAL UNDERTAKING IS, WITH SOME EXCEPTIONS SUCH AS IN TEXTILE SPINNING AND WEAVING, RELATIVELY SHORT.
/+IT IS