Hundreds of workers in Hong Kong travel industry to be put on unpaid leave, union chief predicts, as wage subsidy scheme nears end

a person walking down the street: Most businesses on the normally crowded Park Lane shopping boulevard in Tsim Sha Tsui have been shut because of plummeting tourist numbers. Photo: Sam Tsang

Most businesses on the normally crowded Park Lane shopping boulevard in Tsim Sha Tsui have been shut because of plummeting tourist numbers. Photo: Sam Tsang

Around 1,000 Hong Kong travel industry workers could be asked to take unpaid leave in the next few days, a trade union leader said, as the coronavirus pandemic continued to batter the struggling tourism sector.

Tong Kim-sang, general secretary of the Hong Kong Travel Industry (Outbound) Tour Escort and Tour Guide Union, told a local radio programme that up to three large travel agencies were expected to make the announcement soon.

The grim forecast comes after Sunflower Travel, a prominent local travel agency, asked almost 300 employees to take unpaid leave from December. Staff have until noon on Thursday to respond to Tuesday’s request.

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Tong said the company’s decision was expected, as most tour guides had been on unpaid leave since the Lunar New Year in late January.

“If there are no additional conditions, I believe most employees will sign the consent form for unpaid leave,” he said.

a store inside of a refrigerator: Sunflower Travel's business has suffered as a result of the coronavirus. Photo: Felix Wong

© Provided by South China Morning Post
Sunflower Travel’s business has suffered as a result of the coronavirus. Photo: Felix Wong

Sunflower Travel received HK$6.6 million in government wage subsidies for keeping its 297 workers through the second round of Covid-19 relief funding.

Under the HK$81 billion Employment Subsidy Scheme, the government, via employers, paid up to 50 per cent of workers’ salaries between June and November, with the monthly subsidy for each worker capped at HK$9,000.

A requirement of the scheme was that employers were banned from laying anyone off during the six-month period.

On Monday, travel agents warned the industry would see between 6,000 and 8,000 employees let go in December if the government did not provide further financial support beyond next month.

With all but three of the city’s border checkpoints remaining closed since February, Hong Kong tourist arrivals plunged 92.4 per cent, to 3.55 million, in the first nine months of this year compared to the same period last year.

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Alice Chan Cheung Lok-yee, executive director of the Travel Industry Council, which issues licences to agents, said there were 1,727 travel agents as of October 21, compared with 1,900 at the start of this year – a 9.1 per cent decrease.

“Most agents will try to keep their licences as they wait for travel business to resume,” she told the Post. “However, without further assistance from the government, they can no longer afford to keep their staff, and more travel agents are expected to ask staff to take prolonged unpaid leave or even lay off staff.”

She added that the potential loss of skilled and experienced staff would deal another blow to travel agents.

Meanwhile, Cathay Pacific cabin crew are in talks with management over new contracts that would cut wages by up to 40 per cent.

Last week, Cathay slashed a record 5,300 jobs in the city and scrapped its Cathay Dragon brand in a desperate restructuring attempt to survive the pandemic. The job losses comprised 4,000 cabin crew, 600 pilots, and 700 ground staff and office workers.

Cathay set November 4 as the deadline for the remaining 8,000 flight attendants to sign the new contracts, but sought to encourage earlier sign-ups by offering a one-off payment to those accepting the offer by Wednesday.

The airline’s pilots union was also grappling with a contentious new deal that would see experienced pilots take pay cuts of up to 60 per cent.

Both groups have been told employees would be terminated, not made redundant, if they failed to accept the new contracts by Wednesday next week.

Opposition lawmaker Jeremy Tam Man-ho, a former Cathay pilot, saw this as a threat.

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“There is a difference between being laid off and terminated,” he said. “If you are entitled to benefits … you will lose them. Termination is usually due to issues of misconduct. But now staff are being terminated just because they don’t accept the terms of the new contract. Why are they being penalised?”

Zuki Wong Sze-man, chairwoman of the Cathay Pacific Flight Attendants Union, said the situation at the airline would set a precedent for others who would also soon face losing their jobs.

“This not only affects our company,” she told the same radio show. “The government wage subsidies will only cover the next month. In December, companies can start to cut jobs, change contracts, slash wages … the same situation as us. We will keep fighting.”

Additional reporting by Denise Tsang

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