Labor leave reforms move ahead after public consultation

[Photo: Ricaela Deputado]

A mendments to the Labor Relations Law extending maternity leave to 90 days and introducing a mechanism to increase annual leave based on years of service will proceed as proposed, with Macau authorities noting broad public support for the direction outlined in the consultation document.

The Permanent Committee for the Coordination of Social Affairs held its second plenary meeting of the year yesterday, focusing primarily on two issues under the Labor Relations Law: increasing maternity leave and annual leave days, and reviewing severance pay and the maximum monthly basic remuneration.

Macau authorities conducted a public consultation on the proposed amendments from January to March of this year, aiming to enhance labor rights. The proposal recommends extending maternity leave from the current 70 days to 90 days, and increasing annual leave based on length of service – adding one day for every two years of service, up to a cap of 12 days.

Additionally, authorities plan to provide eligible small- and medium-sized enterprises with a subsidy covering up to 20 days of maternity leave pay.

Notably, the meeting also addressed two key issues: a review of severance pay and the maximum amount of monthly basic pay.

At a post-meeting press briefing, the Labor Affairs Bureau (DSAL) director, Chan U Tong, announced that the bureau has completed the analysis of over 10,000 comments collected during the public consultation on proposed amendments to the Labor Relations Law, with results showing broad public support for the proposed legislative changes. The amendments have been included in this year’s legislative agenda, he pledged.

Chan also confirmed that the bureau has completed the fifth statutory review of the maximum amounts for severance pay and basic remuneration. Based on data regarding changes in local residents’ income, corporate hiring needs, and price fluctuations, the bureau recommends maintaining the current ceiling of MOP21,500.

Labor representatives on the committee expressed “support in principle” for extending maternity leave as a means to encourage higher birth rates through institutional arrangements.

However, they pointed out that local SMEs continue to face “an unstable and less-than-ideal business environment,” with growth in tourism and gaming revenue remaining uneven. Certain industries, such as neighborhood restaurants and retail, “face significant cost pressures.”

Representative Chan Chak Mo noted that if businesses need to arrange replacements while employees are on leave, they will incur “increased costs for substitute staff,” and resolving labor shortages through actual recruitment “may not be easy.”

He urged the government to consider providing subsidy arrangements, using the current practice – where the government subsidizes 14 days of the 54- to 70-day maternity leave – as a reference. “A permanent subsidy mechanism should be established,” Chan said, adding that it should be maintained at least until the current arrangement is reviewed “to prevent businesses from bearing excessive pressure.”

Both labor representatives agreed with the proposed escalation mechanism and the increase in maternity leave days. Chan noted that raising annual leave to 12 days is a step in the right direction and aligns with international trends, but he urged the government not to implement the change in a “one-size-fits-all” manner.

He further pointed out that even if the law is not applied retroactively, companies’ existing annual leave arrangements may still be automatically increased once the new rules take effect – creating staffing and cost pressures. “The common thread in both legislative amendments is that they will impact human resources and increase costs,” Chan said.