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February 12, 1996
TRADE UNIONISTS ARE SHAKING UP HONG KONG'S MIGHTY CAPITALISTS
By MARCUS ELIASON
Associated Press Writer
HONG KONG (AP) -- Hong Kong's image as the natural habitat of rampant, untamed capitalism is being threatened by a new force -- trade unionists with teeth.
With a history of low unemployment and rising living standards, Hong Kong has never had much to fear from organized labor. But now trade unionists have taken advantage of the colony's late-blooming democracy to get elected to the legislature, and they are shaking up the establishment.
One reason for the unionists' higher profile is the 3.5 percent unemployment rate which, although low by Western standards, is Hong Kong's highest since 1984.
But the broader reason is the reformed electoral system, which has swept an array of social crusaders, labor activists and civil rights campaigners into a legislature previously dominated by businessmen and government appointees.
In the September election for Hong Kong's first fully elected legislature, trade unionists raised their strength from three seats to seven in the 60-member chamber. There they quickly won a battle to slash imports of cheap foreign labor.
Now they have provoked more hand-wringing in the business community by legislating a sharp increase in severance pay for workers whose companies go bankrupt. Next on their list is the right to block bus fare increases.
Not only businessmen are worried. China, which takes over Hong Kong in 1997, has also has voiced concern that the government will give in to pressure for cradle-to-grave welfare benefits, and squander Hong Kong's money.
Lee Cheuk-yan, the trade union leader and legislator who initiated the severance pay hike, insists he is only asking for parity with other Asian countries. Malaysia recognizes collective bargaining in some circumstances, he says, and even impoverished Bangladesh gives women paid maternity leave.
As for China's qualms, he says: "The Chinese Communist Party is no longer a party of workers and peasants. They have all become employers and capitalists."
What particularly alarmed business people was that issues like severance pay have traditionally been decided not by legislators, but by the Labor Advisory Board consisting of employer and employee representatives.
The board had agreed to a ceiling of $3,077 for severance pay. Lee's amendment upped that limit by 50 percent.
Ian Christie of the Hong Kong General Chamber of Commerce called the hike "totally unacceptable," and joined Gov. Chris Patten in accusing the unions of violating advisory board agreements.
"Unions ought to understand that ... drastic changes to that system may damage the economy and the workers they defend," the Hong Kong Standard said in an editorial.
But Lee, who heads the 120,000-member Hong Kong Confederation of Trade Unions, says government and business have been ganging up on labor for too long, and he wants to "shift the balance a bit" in the workers' favor.
Hong Kong has "a very laissez-faire government and employer groups which have very strong connections with the government," he said in an interview. "Labor has always been on the disadvantaged side."
Only 20 percent of the work force is unionized, he says. Strikers have no protection, and the government does not recognize collective bargaining. Employees and employers are equally represented on the Labor Advisory Board, but the chairman, who can break a tie with his vote, is a government appointee.
Business people argue, however, that Hong Kong's affluence depends on its peaceful labor relations. To tamper with consensus-seeking bodies like the Labor Advisory Board, they say, is to not only promote Western-style social benefits, but Western-style labor unrest.