TNAG-0650-FCO40-798-Study-of-labour-relations-in-Hong-Kong-by-Professor-H.-A.-Tu-1977 — Page 112

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Fourthly, there are a number of general signals which are

accepted as particularly relevant for the wage policy of individual firms.

There are three cost-of-living indices for different income groups

(including the unofficial Han Seng index). Of especial importance,

are

•

we were frequently told by private managements, is the Government's own

annual pay decisions. In theory, since 1968, the Government has accepted

the principle of "fair comparison" with "good" outside employers as a

basis for adjusting public service pay, and to aid discussions in the

Senior Civil Service Council has established a Pay Information Unit,

which surveys 68 firms annually. In practice, these are necessarily the

larger employers; the ultimate pay adjustment resulting is, however, taken

as a major factor in the annual pay decisions of many other firms. Since

these include some which are in the P.I.U. survey, the process is often

criticised as a circular one; but there seems no doubt that the

government pay increase is a major factor in the pay decisions of a consider

-able number of smaller firms.

45.

It seems generally accepted by employers that there is a lower

broadly speaking, limit to their pay-decisions: /wage-rates must not be cut (even in the

severe 1974 recession, there appear to have been few instances of direct

wage-reductions though earnings were often reduced by work-sharing or

short-time). On the other hand, we were commonly told that it was

advisable to "keep ahead" of potential worker demands in effect, to

pass on some benefit of evident prosperity. But firms also had some

insurances against miscalculations in wage-policy: the system of New Year

bonuses which appear highly variable in many firms (at least for white- collar staff) and the frequent turnover of piece-rates which permitted

upward or downward adjustment of actual hourly wages in much of

manufacturing, for instance. While some larger concerns had mutual

agreements to avoid "poaching" of labour in situations of anticipated

scarcity.

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