Following is a question by the Hon Andrew Cheng and a written reply by the Secretary for the Environment, Transport and Works, Dr Sarah Liao, at the Legislative Council meeting today (June 30):
Question:
Regarding the projects contracted out by the Government, will the Government inform this Council:
(a) of the number of projects contracted out by the Housing Department, the Architectural Services Department, the Highways Department and the Civil Engineering Department in the past three years and their total value; the respective numbers of projects contracted out to contractors and consultant companies; and the number of labour disputes in connection with the projects contracted out by the Government and the number of employees involved;
(b) whether the above departments, in contracting out projects, have kept information about the subcontractors, sub-subcontractors and all lower tier subcontractors; if so, of the respective numbers of subcontractors, sub-subcontractors and all lower tier subcontractors broken down by project; if not, whether it will consider requiring the contractors or consultant companies to provide such information; and
(c) whether it will consider following the practices of private companies by keeping the name lists of all workers who are engaged in the projects contracted out by the Government and their employment contracts, and requiring the main contractors to assume the responsibility as an employer in any labour disputes involving their subcontractors at all tiers, to employ the workers under formal employment contracts, and to pay wages directly to the workers; if so, please provide the timetable for the adoption of these practices; if not, the reasons for that?
Reply:
Madam President,
(a) From 2001 to 2003, the number of works contracts awarded by the Housing Department (HD), Architectural Services Department (ArchSD), Highways Department (HyD) and Civil Engineering Department (CED) and the total value of the contracts are as follows:
Department No. of Contracts Total Value ($ billion)
********** **************** **********************
HD 329 17.5
ArchSD 308 33.2
HyD 79 19.2
CED 130 10.4
In general, the Government does not directly subcontract its projects to contractors or consultant companies.
The Labour Department (LD) does not keep a separate record of the number of labour disputes involving government projects. This is because in the conciliation of labour disputes and claims, the LD will not ascertain whether a case involves government projects. In fact, whether or not a case involves government projects has no bearing on the statutory rights and liabilities of the parties concerned under the Employment Ordinance.
However, with effect from September 2002, all works departments under the Environment, Transport and Works Bureau (ETWB) are required to submit to the Bureau monthly reports on cases of wages disputes in connection with public works contracts. From January to December 2003, the three works departments mentioned above (i.e. the ArchSD, HyD and CED) recorded a total of 33 cases of wages disputes involving public works contracts. All of the cases have been referred to the LD for follow-up action and assistance. The works departments have also rendered assistance to the workers concerned as far as practicable.
(b) There was no established Government policy in the past requiring works departments to keep information about the subcontractors of their projects. However, the ETWB has since mid-2003 required all main contractors of new public works contracts to submit information about their subcontractors to the relevant works departments. Such information collected by the above departments in 2003 are as follows :
Depart- No. of No. of No. of No.of
ment Main Subcontractors Sub- Subcontractors
Contractors subcontractors at the
Fourth Tier
***** ********* *********** ********* ***********
ArchSD 45 261 24 0
HyD 17 189 0 0
CED 11 20 11 2
(c) Under the proposed Construction Workers Registration Scheme, a Register will be set up to record the basic information about all registered construction workers. Upon the implementation of the Scheme, a card-reader will be used to verify the registration status of every worker entering and leaving a construction site. By doing so, the Government and contractors should be able to keep track of every construction worker working at a construction site.
Regarding the proposal requiring the main contractor to pay wages directly to the subcontractor's employees, the Employment Ordinance already has provisions requiring the main contractor of a building and construction project to pay, on behalf of the subcontractor or nominated subcontractor, the arrears of wages payable to the subcontractor' employees, not exceeding the wages for the first two months of the period in question. Such wages are paid by the main contractor on behalf of its immediate subcontractor in the form of disbursement and the amount involved is considered a debt owed by the subcontractor to the main contractor. The main contractor may seek to recover the debt from the subcontractor through civil proceedings. The proposal requiring the main contractor to assume responsibility for all labour and wage disputes is contrary to the original intention of subcontracting and may have far-reaching implications. In fact, according to the General Conditions of Contracts for existing public works, if a worker employed by the main contractor files a claim against the main contractor in respect of wages payable to him and can prove to the satisfaction of the Commissioner for Labour that the claim is reasonable, the Government may deduct the same from the contract sum payable to the main contractor so as to settle the claim. As more information will be available after the Construction Workers Registration Scheme is introduced, the Administration may consider strengthening the relevant measure in this respect.
As for employment contracts, the Government will do its best to encourage main contractors to require their subcontractors to sign formal employment contracts with their employees directly in order to avoid labour disputes as far as possible.
Ends/Wednesday, June 30, 2004
NNNN