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Asia employment law bulletin 2020

Hong Kong

2019 has been a year of political upheaval for Hong Kong.

The pro-democracy protests which began in June, show no signs of abating, despite escalating violence and November 2019 landslide victory for the pro-democracy party at the district council elections. Uncertainty remains as to the possible political developments that Hong Kong might see in the immediate and more distant future. However, the political unrest, against a backdrop of the US-China trade war and an easing in China’s economic growth, has contributed to the economic decline of Hong Kong. Plunging into an official recession for the first time in 10 years, Hong Kong’s economy shrank by roughly 3% during the three months leading up to September 2019 and it is expected that the recession will continue into 2020.

The political disruption in Hong Kong has meant employers in the region have needed to navigate several sensitive people issues including how to handle citywide walk-outs (please see our article: “Political unrest and strikes in Hong Kong: What employers need to know”) and the growing pressure to reduce workforce costs.

An increasing number of companies in Hong Kong are considering their contingency plans and so employers are having to consider redundancies but also the alternatives to downsizing, which we explored in our recent article “To downsize or not to downsize: What are the alternatives?”

Another trend we are seeing in the Hong Kong market is employers embracing flexible and agile working policies. In the past year, we have received a marked increase in the number of requests from employers to assist them with putting in place agile and/or flexible working policies. And these policies have been tested over the last six months, with the disruption to transport caused by the protests, necessitating remote working. We explored some of the issues around agile and flexible working in Asia in our article “Agile and Flexible Working in Asia – How to get it right”.

Looking forward to 2020, it seems that political uncertainty will continue for Hong Kong as well as the economic recession, which will both continue to give rise to new legal and commercial challenges for employers in the region.    

Stephanie Chiu, Freshfields Hong Kong 

Nicola Jones, Freshfields Hong Kong