Question

How has the Covid-19 has affected the unemployement and cost of living(inflation and deflation) in Hong Kong?

Answer 1

Dear Student,

Yes definitely Covid-19 affected the employment and cost of living(inflation and deflation) in Hong Kong

Below are the main factors of impacts

1) Employers are obligated to extend the CNY Holidays

Given that the purpose for the extension of the CNY Holidays (as required by the State Council of the PRC) is to contain and control the spread of the virus, employers are obligated to comply with this accordingly. Employers who do not do so may face grave consequences pursuant to Articles 64 and 66 – 68 of the Emergency Response Law of the PRC , which was promulgated in 2007.

2) Salary during the extended CNY Holidays

Employer shall pay the relevant salaries to their employees based on their employment contracts. If employees had applied for annual leave during this extended period of time, they are entitled to withdraw their leave application.According to the Shanghai Municipal Human Resources and Social Security Bureau (“Shanghai HRSS”), the suspension of work shall be regarded as "days off. If employees work during this period of time, they are entitled to take deferred days off-in-lieu or 200% of their regular salaries in lieu of.

3) Leave and other policies

For those employees who are unable to take leave due to epidemic prevention and control, employers arranged for days off-in-lieu as set out in the Announcement of the State Council of the PRC. However, how shall one treat / compensate employees who work during the extended CNY Holidays and yet are unable to utilize the days off-in-lieu? This will depend on whether the extended period for the CNY Holidays is considered as "statutory holidays" or as "days off-in-lieu".

4) Employers should suspend work as required by the local government

local governments have given notice to deemed indispensable industries such as water, gas, power supply etc., no company shall start work before the suspension period.

Some municipal governments, such as Shanghai and Nanjing, further demand that employers who intend to start to work "for specific reasons" should file a report to the local epidemic prevention and control offices and that work can only be commenced after approval is granted

5) Dismiss Employment

The following measures will likely be considered discriminatory and unlawful under the DDO and the FSDO:  

• To dismiss employees solely because they have been / are suspected of being infected; and

• To refuse to arrange interview / hire candidates because they have been / are suspected of being infected, for example because they come from Wuhan.

*Cost of Living (Deflation)

While low oil prices mean shipping goods and traveling would be cheaper, the worldwide epidemic means people are staying at home, further affecting global economies.

Hong Kong’s tourism industry has been badly hit. Only 3.2 million visited Hong Kong in January, a decline of 53 per cent from the same period last year.

According to official statistics, the city’s unemployment rate is now at a three-year high of 3.4 per cent. Meanwhile, the jobless rate in the retail, accommodation and food services sectors stood at 5.2 per cent.

However the cost of Living decreased significantly and Hong Kong in Lodge, Hotels and Resorts. Also Landlords and Home owners informed to waive off rent during this pandemic period

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