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Survey on cost impact of labour legislation being conducted
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Following is a question by the Hon James Tien Pei-chun and a written reply by the Secretary for Education and Manpower, Mr Joseph W P Wong, in the Legislative Council today (Wednesday):
Question:
As some employers claim that changes to the labour legislation over the past two years have resulted in their payroll expenses being inflated by 15%, will the Government provide this Council with a breakdown of the increases in payroll expenses arising from each amendment to labour legislation in the past two years, taking into account the median wage, average age and average years of service of the work force, the ratio between male and female staff and other relevant factors?
Reply:
Mr President.
The Government's assessment of the cost impact of labour legislation is based on its estimate of the difference in overall labour cost in the economy before and after each amendment to labour legislation has come into effect. The increase in labour cost is expressed as a percentage of the total wage bill, covering both the private and the public sectors. This estimate of cost impact has been compiled on the basis of the wage and other characteristics of the labour force obtained from the latest survey on the impact of labour legislation on the economy conducted by the Census and Statistics Department in collaboration with the Labour Department in 1992.
Using this methodology, the estimated increase in labour cost as a result of the amendments to labour legislation enacted in the past two years which have a cost impact amounts to around 0.25% of the total wage bill. Of the 0.25%, 0.06% was attributable to amendments to the Employment Ordinance while 0.17% and 0.02% were due to the amendments to the Employees' Compensation Ordinance and the Occupational Deafness (Compensation) Ordinance respectively. The itemised breakdown of this estimate is at Annex.
We are conducting another survey on the cost impact of labour legislation to update the information collected during the last survey in 1992 in the light of the changes in the labour market. The survey is expected to be completed early next year; and we will inform Members of the results as soon as they are available.