Asian Food Worker Frontpage
Hong Kong Hotel and Catering Union Targets Scandal of Indecent Wages in Fast Food Sector

(above) Juo So In, spokesperson of the Catering and Hotels Industries Employees General Union.
On 27 Aug 2006, members of the Catering and Hotels Industries Employees General Union (an affiliate of the IUF and the Hong Kong Confederation of Trade Unions) protested outside a Kentucky Fried Chicken (KFC) outlet in Hong Kong, condemning the chain giving scandalously indecent wages and calling for legislation of minimum wage, after a union study found KFC paid an hourly rate of HK$15.70.

Low wages in the Fast-Food Chains

The April study found that KFC, McDonald's, Pizza Hut, Cafe de Coral, Fairwood, Maxim's and Yoshinoya pay HK$15.70 to HK$19 an hour. KFC workers earn about HK$3,000 a month. The salary is not enough to cover living expenses. (The median income in Hong Kong announced by the Government in August is HK$10,000)

Apart from giving low wages, some fast-food chains also use every means to avoid their responsibilities. According to the Hong Kong Labour Ordinance, an employee who is employed continuously by the same employer for 4 weeks or more, with at least 18 hours worked in each week, is entitled to rest days, paid annual leave, sickness allowance, severance payment and long service payment. But many fast food chains require part-time employees to either stop working or work one day only in the fourth week. This way the employer avoids providing the legal requirements.

The Government delays the legislation of minimum wage

Hong Kong Chief Executive Donald Tsang promised during the 2005 election that a proposal on a minimum wage would be worked out by June 2006. It is already three months overdue.

Donald Tsang asked the Labour Advisory Board (LAB), a tripartite consultative body comprising representatives of employers, employees and government, to discuss the issue of minimum wage. But the issue has been discussed in the board for 18 months without any sign of a a consensus between the labour camp and the employer camp.

The union believes that the HKSAR Government should directly consult the public about the minimum wage and submit a bill to the Legislative Council.

The toothless proposal of the Labour Advisory Board

The LAB is planinng to have another round of discussions about the minimum wage. But the employer-members of the board are only willing to comply with minimum wage requirement in the cleaning and security sectors through a charter, which means there will be no legal enforcement.

Yet, this will not solve the problems of low wages in Hong Kong. Exploitation occurs across all sectors, including in catering and fast food. Moreover, without an actual law mandating minimum wages employers have already proved unwilling to abide by guildelines. The Government previously issued guidelines requiring employers with Government outsourcing contracts to pay cleaning and security workers not lower than the median figures of those in the private market, yet no employer follows this.

The demands from the union

The Catering and Hotels Industries Employees General Union will meeting with fast-food chains workers from different districts and invitations will be sent to the management of fast-food chains for negotiating reasonable wages.

The union has demanded legislation of the minimum wage, as it is the only way to secure reasonable wages and a decent life for the lowest paid workers in the catering industry.

The union has joined the “People's Alliance for Minimum Wage”. It was formed by 24 union groups from different sectors. The coalition will have a series of actions which are aimed at pressing Chief Executive Donald Tsang to address the issue of minimum wage in his next policy address in October.

The comparison of the employees’ salaries in the seven fast food shop chains:

Group Salary per hour (HK$) Working hours per day *Monthly salary(HK$) **Estimated number of employees # Profit in 2005 (HK$)
KFC $15.7 8.4 $3,429 1400 1.255 billion(globally)
Fairwood $16.5 10 $4,950 1600 41 million (for the past 1/2 year in Hong Kong)
McDonald's $17 7.6 $3,359 5200 4.875 billion (globally)
Cafe de Coral $17.7 9.7 $5,151 2500 0.28 billion (globally)
Maxim's $18.9 7.8 $3,833 1600 Dairy Farm Group is the parent company which holds 50% of Maxim’s shares, 1.848 billion (globally)
Pizza Hut $19 10 $4,940 1200 Jardine Pacific is the parent group, 0.53 billion (globally)
Yoshinoya $19 7.6 $3,754 500 Unknown

* The calculation is based on working for 26 days in each month
** If each outlet has an average of 20 employees, then the Pizza Hut outlets have the largest scale of employees which are 30 people in each outlet
# Sources from the companies’ annual report. For KFC and McDonald's, the sources are from news materials.

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