Domestic Helper Rights in Hong Kong – Avoiding Bad Loans and Financial Pressure

by Edouard Muller, the founder of HelperPlace

by Edouard Muller

Huge fees collected by agencies, bad working hours and lack of privacy have always affected foreign domestic workers in Hong Kong. In a recent report about migrant workers, an NGO found out that nearly half the respondents said that agencies charged them anything between HK$5,000 and HK$10,000 in commission, exceeding Hong Kong laws by miles.

The Widespread Corruption 

It is stated in the regulations mentioned under Employment Ordinance and Regulations, that recruiters cannot collect more than 10 percent of a worker’s monthly salary as commission. Since minimum monthly wage for domestic workers is stipulated to be HK$4,310 (now it’s HK$4,410), agencies can charge about HK$431(now it’s HK$441) in agency fees. About 4% of respondents said that they paid less than that amount in agency fees, which clearly underlines the corruption seeped into agency operations.

More than 90 recruitment agencies were named in complaints wherein workers stated that they overcharged them using labels such as registration fees and training fees so that they can trump regulations.

About 21% of respondents claimed that they had to shell an astounding HK$15,000 in fees. Also, there has been a spike in fraud cases where agencies collected fees for nonexistent jobs too.

Proliferation of Loan shark syndicates 

In recent times, it was reported that a prolific loansharking syndicate lent a staggering amount of HK$10 million to Filipino domestic helpers in Hong Kong with whopping interest rates touching 120 percent on an annual basis. The suspected ringleaders and members were round up after police inquiry and jailed too.

Initial investigations showed that in six months, more than 1,200 domestic helpers borrowed a lot of money from a syndicate run by a Hong Kong-based couple. The increase in worker suicides put light on the loan shark syndicates and their operations. Loan amounts varied from HK$4,000 – HK$15,000 each. The debtors had to surrender passports and employment contracts as security against the loans.

About 10 percent of loan amount was charged as monthly interest, that went up to 120 percent on an annual basis, well above the government’s specified limit of a maximum of 60 percent. The organized crime fighting cell reported that such syndicates earned more than HK$12 million in profit through illegal loans on an annual basis.

Domestic workers in Hong Kong should be aware of laws and policies

According to Employment Ordinance and the Employment Agency Regulations, the maximum commission that can be charged by employment agencies in Hong Kong should not exceed 10% of the first month’s salary. The fees can be charged only after the helpers are successfully placed and after the helper receives their first month’s wages. If an agency charges a domestic helper more than the maximum amount, they are breaking a law and are liable for prosecution.

It is also mentioned as part of the ordinance that expenses for processing employment contracts and entry to the country including medical examination, consulate fee, fees for visa processing, insurance fee along with airfare from native country to Hong Kong must be borne by the employer.

The Labour Department has promised to work against recruitment agencies that have violated laws, and even licenses will be revoked or not renewed for another term. The penalty at present is from HK$50,000 fine to a maximum penalty of about HK$350,000 fine and three months jail term.

Domestic Helpers Rights and Governing Laws 

But all efforts by the government can bear fruit only if domestic helpers themselves remain aware of their rights, to ward off bad loans and financial pressure.

  • Know your rights as a resident in Hong Kong with the guide – Helpers for Domestic Helpers created by Civil Liberties Union. Attending an Enrich workshop will help workers to plan better financially.
  • Some employers can abuse and even take advantage of domestic helpers. Do not let yourself be mistreated. Also, keep copies of all medical records in case you want to furnish proof of the previous mistreatment.
  • Read police statements carefully and ask for documents in your language. Give the right details and then get copies of anything you sign.
  • Do not allow employers to keep your ATM card, or else contact the bank for another card.
  • Never sign a blank receipt and keep an adequate record of wages.
  • You should one full day off every week along with 12 days off every year based on statutory holidays. One can volunteer to work on off days though.
  • 7 days’ paid annual leave is a must for domestic workers up to a maximum of about 14 days every year.
  • Domestic helpers need to be provided with furnished accommodation and free food or a sizeable allowance of HK$920 (now it’s HK$1,053) other than the salary for the same.
  • Helpers should also receive free medical treatment.
  • Employers need to buy a free air ticket to the helper’s home country (or adequate cash) after the contract.
  • It is illegal for employers to fire pregnant domestic helpers. They are also entitled to 10 weeks of paid maternity leave.
  • Employers cannot keep your possessions, including phone, passport, or any processing documents.
  • Domestic helpers cannot work in more than one place as it is against immigration laws. Helpers who do more than one job, risk prison sentence and even deportation.

Those domestic helpers who are aware of their rights are not prone to misleading statements or corruptive practices of agencies and employers. Hence it is essential that all helpers know about the rules, abide by them and also do not encourage any malpractices.

ABOUT THE AUTHOR
Edouard Muller is the founder of HelperPlace, a social-oriented platform connecting freely employers and domestic helpers. For more information, visit www.helperplace.com

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