Keep on top of major reforms

Sweeping reforms across the Asia Pacific and Australasian region make it
vitally important that HR directors keep up with the latest employment
legislation. Elius Levin reports

Many countries in the Asia-Pacific region are modifying employment
legislation concerning working conditions and discrimination. Between the
rationalisation of the Chinese Labour Law and the considerable revisions
underpinning the New Zealand Employment Relations Act, the changes mirror
varying degrees of the underlying local industrial relations-legal environment

HR directors of multinational corporations are wise to "Act global,
think local" when dealing with host country employees and expatriates sent

Take New Zealand. In 2000, the Labour-Alliance coalition government
introduced the Employment Relations Act, which beefed up the powers and status
of unions, over that of the previous National (Conservative) government’s
Employment Contracts Act (1991), which had been designed to introduce greater
flexibility into the employee-employer relationship and away from the
centralised, wage/condition fixing system.

"As a result of changes introduced with the Employment Contracts Act
and carried over in the ERA, there is very little regulation of working hours
and working days," said Peter Churchman of KPMG Legal, New Zealand.
"The current legislation leaves things like the payment of overtime to the
parties to work out for themselves."

New Zealand’s ERA, along with the Human Rights Act, closely follows the
prevailing anti-discrimination legislation, making it unlawful to discriminate
on the basis of race, religion, ethnic origin, sexual orientation and age.

In most circumstances, an expatriate’s working conditions are governed by
the laws of the country in which the contract was entered into. Only for those
expatriates on secondment from another (home) country, and whose terms of
employment are set in another country, is it possible to "contract
out" to ensure that NZ employment laws do not apply.

Churchman adds, "In this case, it would be very useful for the
employment contract to have a clause specifying the country where laws were

In the case where NZ laws are chosen, the law makes no distinction between
expatriates and local employees. Yet, irrespective of the employment agreement,
all employers must comply with NZ’s health and safety laws.

In Australia, an eight-hour day, 40-hour week might be considered the norm,
with overtime conditions applying for all hours worked beyond this time.
However, much depends on the award/agreement/contract that governs an
employee’s conditions. The various labour agreements prescribe overtime rates
as well as the amount of time permissible.

While Australia’s discrimination laws are in keeping with the 1995
Convention on the Elimination of all Forms of Discrimination against Women
(CEDAW), in some states they also allow "special measures" to be
taken to achieve equality for those disadvantaged due to their sex, marital
status or pregnancy.

In 2000, New South Wales, in line with most of Australia, made it unlawful
to discriminate directly or indirectly against an employee or job applicant
because of the person’s family, parental or carer responsibilities. South
Australia is the only state not to adopt such legislation.

Expatriates working for multi-national corporations within Australia are
governed by local employment laws and are treated no differently to local
employees, says Chris McArdle of KPMG Legal, Sydney.

In China, the eight-hour day, 40-hour week is legally observed. However,
employers do have some freedom to reschedule working hours depending on the
nature of work and production needs while maintaining the regular 8/40 system,
with one day of rest.

Beyond this, implementing legislation of China’s 1994 Labour Law prescribes
the legal limit for overtime as three hours a day, with a maximum 36 hours per
month, as well as overtime to be paid. Says Peter Corne, a consultant of
Linklaters Shanghai, "The Law unifies a raft of regulations and rules
variously issued by the People’s Congress, the State Council, its various
ministries as well as some local government regulations."

Also, the minimum wage system is increasingly being adopted throughout
China. In 2001, nine regions have adjusted their minimum wage standard, following
15 other regions in 2000. To date, nearly 30 provinces, autonomous regions and
municipalities have minimum wage legislation.

In terms of anti-discrimination legislation, the 1994 Labour law mirrors
much of that of its neighbours and CEDAW. China also has in place stipulations
that positive discriminate towards women, disallowing them from performing
certain types of graded, physically arduous work.

And, when it comes to employment contracts between expatriates and Chinese
parties, Chinese law allows the parties to choose which laws they will use to
govern the contract. If no choice is made, Chinese laws will usually apply.

Singapore takes yet another approach, with the law concerning work hours,
overtime and work days being applied differently. Singapore’s Employment Act
generally covers persons regarded as an "employee", one who isn’t
employed in a managerial or executive position, and who earns not more than
S$1,600 per month.

Expatriates are covered by the Employment Act – if they meet the definition
of "employee". For those who do not fall within the Act, common law
and the specific terms of the contract form the basis of the employee-employer
relationship. This applies equally to local and foreign employees.

Generally, Singapore has an eight-hour day, 44-hour week. Work done above
those hours by those covered by the Act requires payment of overtime, with the
maximum permitted overtime being 72 hours a month.

Singapore has no anti-discrimination legislation, but instead has sought a more
proactive approach, says Allen and Gledhill’s Tan Su May. While adopting CEDAW
in 1995, by 1999 Singapore had put in place tripartite guidelines advising
employers on non-discriminatory job advertisements. From January 1999 to
October 2000, there has been almost complete eradication of discriminatory
criteria from these jobs ads, falling from 32 per cent to less than 1 per cent.

Hong Kong, unlike other countries, has shied away from legislating working
hours and overtime for adults. Most manual workers perform a six-day, 48-hour
week, with a five-and-a-half-day week for white collar workers, many of whom
work on alternate Saturdays. Both patterns are compatible with Hong Kong’s
Employment Ordinance.

Anti-discrimination legislation comes in the form of ordinances covering sex
discrimination, disability and family status. However, despite calls from many
quarters, Hong Kong has never enacted race discrimination legislation.

For Hong Kong-bound expatriates on secondment, HK employment law, according
to David Clark of Linklater’s Hong Kong. "Applies regardless of an express
choice of foreign law. One is unable to contract out of Hong Kong statutory
protections." However, it is possible to have home country and Hong Kong
law considered side by side.

Further legal information

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