It only takes a stroll down the street in Hong Kong to see that employment agencies for foreign domestic workers (FDW) are really everywhere. Unethical agencies are similarly prevalent, subjecting workers to exploitation.
How does the whole thing work?
Beginning in the worker’s home country, they are charged a training fee of up to 20,000HKD. Upon their arrival in Hong Kong, they are forced to pay new fees to the employment agency of an amount far above the legal maximum. More than 80% of the FDWs are in debt, while 84% of the FDWs interviewed by The Hong Kong Confederation of Trade Unions paid an average of US$1,135 in fees.
The offending agency will then collude with money lenders, and force the workers to take out loans. Hong Kong Domestic Workers General Union has exposed a case involving Indonesian Overseas Limited, where the agency and the moneylender, without explaining the documents to the workers, forced the workers to sign the papers to pay 3,380 HKD per month over six months, totalling 20,280 HKD. However, the worker did not receive any of the ‘loaned’ money.
If FDWs complain or refuse to repay the debt, the agency will persuade the employer that the workers are unfit, and that they should be dismissed. When the worker is dismissed, they will most likely have to call the agency to be placed again, but at the cost of another agency fee on top of their original debts. In the end, debts piled on these workers snowball and they have nowhere to escape.
This is the current business model of many agencies: expansion of profit margins through exploiting the workers.
Need for change
However, risks for abusive business practices can be legal, reputational, and trade-related.
The workers are here to stay because they are looking for a better life in Hong Kong, but that also means that they are looking for respect and a good working environment. HK$98.9 billion is contributed by FDWs to Hong Kong’s economy, and if working conditions are too much to bear, the workers will look for better opportunities elsewhere. The current situation calls for building a lasting relationship with all the stakeholders within the supply chain, from the workers to the employers, and to align business interests with employer and employee interests. Ethical business models can improve business reputations. More importantly, ethical businesses can create and preserve a healthy and lasting foreign domestic work sector for Hong Kong’s future.
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Employment Agency Regulations, s 10
Jennifer Creery, “‘It’s tomorrow’s problem’: Hong Kong domestic workers grapple with money woes at seminar on financial management”, Hong Kong Free Press (Hong Kong, 13 April 2019) <https://www.hongkongfp.com/2019/04/13/tomorrows-problem-hong-kong-domestic-workers-grapple-money-woes-seminar-financial-management/> accessed 25 November 2019
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Andrea Lo, “Fair Employment Agency on ethically recruiting domestic workers” (The Loop HK, 21 November, 2016) <https://www.theloophk.com/fair-employment-agency-on-ethically-recruiting-domestic-workers/> accessed 25 November 2019
Jennifer Creery, “‘It’s tomorrow’s problem’: Hong Kong domestic workers grapple with money woes at seminar on financial management”, Hong Kong Free Press
“Guiding principles on business and human rights - Implementing the United Nations ‘protect, respect and remedy framework’”, Office of the United Nations High Commissioner for Human Rights