Macau New Minimum Wage Regime.
Legal News & Analysis - Asia Pacific - Macau - Labour & Employment
10 June 2020
In the midst of the global public health crisis, that impacted Macau Special Administrative Region (“Macau SAR”), the Macau Legislative Assembly approved, on 16 April 2020, which rules the Workers Minimum Wage – Law 5/2020, which will enter into force on 1 November 2020, being the legislative intention to protect the workers and avoid overly low salaries.
After the establishment of a Minimum Wage for the Clean and Security Workers in the activity of property administration was expressly revoked by the new law, this is the first (almost) universal regulation to set a Minimum Wage in the Macau SAR, leaving out of its scope only the segment related to the domestic helpers and disabled workers that are expressly excluded therein.
The new regime will be applied to all labour contracts executed before the Law entered into force (without prejudice to the exceptions above) and which execution is still ongoing, except regarding the legal effects of concrete cases concluded before the Law enters into force.
According to its article 4, the amount of the Minimum Wage varies depending of the type of calculation period, as follows:
• For monthly remunerations, the established minimum wage is MOP 6,656.00/month;
• For weekly remunerations, the established minimum wage is MOP 1,536.00/week;
• For daily remunerations, the established minimum wage is MOP 256.00/day;
• For hourly remunerations, the established minimum wage is MOP 32.00/hour;
• For remuneration based on the number of hours effectively worked on the respective month it is established that the minimum wage is an average of minimum MOP 32.00/hour, as a result of the division of monthly salary by the hours effectively worked. Except for the remunerations based on a result that will take into account the average of the past two months.
The Law further clarifies in its article 9 that the amounts of Minimum Wage will be subject to review once in every two years, and will be updated depending on the economic development of Macau SAR. The competent authority for this function is not defined by Law 5/2020, however we can predict that the Macau Economic Department, in coordination with the Labour Bureau, shall likely be such entity.
Amounts established are based on the basic remuneration (article 3), which is defined by the Labour Relations Law (Law 7/2008) and include, inter alia, the basic wage, the overtime remuneration, the extraordinary remuneration for night work or shift work, the food allowance, the family allowance, subsidies and commissions involved in the exercise of functions, charges levied by the employer to the customer as extraordinary accounts and subsequently paid to the employee.
This new piece of legislation has a wide range of application and will affect, not only the new labour contracts, but also the contracts signed before the approval of its regime but still in execution, being the current remunerations which are below the minimum converted into the Minimum Wage amounts, under the penalty of legal non-existence.
The Law provides a special attention to Overtime Work (defined on article 37 of the Labour Relations Law), under which the hourly remuneration shall be updated according to the hourly amounts stipulated by Law 5/2020.
The application of the Law will be subject to the supervision of the Macau Labour Affairs Bureau, which has seen its competences increased.
Failure to comply with the new regulation of the Law 5/2020 in punished with a fine of MOP 20,000.00 to MOP 50,000.00 per worker in case of non-payment of the Minimum Wage and/or a fine of MOP 5,000.00 to MOP 10,000.00 per worker in case of non-fulfilment of the new Overtime Work’s rules of calculation. These penalties are already part of the Labour Relations Law.
We are in presence of a big step to align Macau SAR with the rules of the International Labour Organization, whose mandate is to advance social and economic justice through setting international labour standards. With the limitation to low salaries for both Local and Non-resident workers, the law aims to ensure a more just and equitable payment to the workers, as well as to realign Macau SAR with the international standards.
Pedro Cortés, Partner, Rato, Ling, Lei & Cortes - Advogados