Hong Kong passes minimum wage law

Hong Kong on Saturday passed its first minimum wage law, a controversial issue that has divided the city's business sector and labour groups for more than a decade.

Lawmakers hailed the passage of the bill -- secured after more than 40 hours of heated debate -- as a historic moment for Hong Kong, where policymaking is often heavily influenced by the powerful business elite.

Officials said the law will take effect next year, and a government-appointed task group is expected to propose a minimum wage level in the coming months.

But pro-democracy legislators, whose numerous attempts to have the bill amended were blocked by their pro-government counterparts, said there were many loopholes in the new law.

Lee Cheuk-yan, lawmaker and a leader of Hong Kong Federation of Trade Unions, said: "No doubt it is a historic moment for Hong Kong."

"We have now said goodbye to an unfair practice in a capitalist economy and acknowledged the fact that workers should be rewarded for their hard work," he told AFP.

Recent surveys showed that many workers at large retail chains are only paid between two and three US dollars an hour.

Lee said it was "regretful" that the legal framework for setting the minimum wage will be largely controlled by the government.

Under the law, all members of the task group will be picked by the city's chief executive. The legislature can only approve or reject the wage level proposed by the group, but cannot make any amendment.

The law will require the task group to review the wage level once every two years, instead of once a year as proposed by trade unions.

"We will have to use public pressure to campaign for a fair minimum wage level, since under the legal framework the control will be largely in the hands of the government," Lee said.

Unions have pushed for the minimum wage to be fixed at 33 Hong Kong dollars (4.2 US dollars) an hour, saying anything less would not cover basic expenses with living costs having risen sharply in recent months.

Many countries already have minimum wage legislation in place, with the hourly rates in New York and London set between 7.25 and 8.80 US dollars.

Hong Kong's minimum-wage proposal had faced stiff opposition from some of its largest employers, with some threatening large-scale layoffs if the change was introduced.

Michael Chan, chairman of fast-food giant Cafe de Coral -- who was ranked by Forbes magazine as the 35th richest man in Hong Kong in 2009 -- has said his company might issue a profit warning if the hourly rate proposed by the unions became law.