LA + DRE ,, . (E) Question 3. Reward Management Measures in the COVID-19 Outbreak (25 marks) As the COVID-19 outbreak continues to spread across the world, Hong Kong's economy has taken a sharp turn for the worse in the first half of 2020. Organizations in Hong Kong have implemented a myriad of cost containment measures in response to the COVID-19 outbreak. The measures target at stemming the economic impact of the pandemic. In particular, small and medium enterprises (SMEs) which form the backbone of the Hong Kong's economy have been heavily impacted by the pandemic. Conducted in May 2020 by the Hong Kong Institute of Human Resources Management, the HR Pulse Check: Cost Containment Measures in the COVID-19 Outbreak polled 136 members. It offered an overview of HR practitioners on the cost containment measures during this critical time. The survey showed that 67% of the respondents said profit loss was among the biggest challenges their organization faced. Besides, disruption of business operation, suspension of business travel and the diminishing customer demand for goods/services were the major challenges. The diagram below showed the cost saving measures that have been put in place by the respondents to cope with the COVID-19 outbreak. Read the diagram and answer the questions below. What are the cost saving measures that have been put in place by your organisation to cope with the COVID-19 outbreak? Answered2 53% 43% 40% 36% 33% 33% 32% 29% 26% 21% Apply for various government subsidies Freeze pay increase Freeze hiring Reduce/suspend non-critical services Reduce hiring Encourage stalt to take annual leave Negotiate with landlord to reduce rent/for more lavourable Reduce training costs Freeze staff promotion Ask staff to take no pay leave Postpone or cancel new investments Other cost containment measures Lay off some employees Reduce non-guaranteed bonus Speed up digitisation to online sales from physical stores Reduce basic salary of staff Close some retail outlets and/or offices Reduce working hours Reduce staff benefits No business cost saving measures implemented Recruit part-timers instead of full time staff 20% 17% 13% 13% 13% 10% 10% 10% 9% 7% 6% 0 10% 20% 30% 40% 50% 60% 70% B0 90% 100% e Source: The Hong Kong Institute of Human Resource Management (3rd Quarter, 2020). "HR Pulse Check: Cost Containment Measures in the COVID-19 Outbreak". Journal of the Hong Kong Institute of Human Resource Management. EDE a) Identify the cost saving measures that are related to components of employees' total reward. (5 marks) b) Referring to your answers given in part (a), which one of the cost saving measures do you think that is the most effective method in helping the organizations to cope with the current challenging situation. Why? (3 marks) c) What are the major types of pay review strategy used by organizations in Hong Kong? (5 marks) d) In your opinion, do you think that the current Statutory Minimum Wage (SMW) and the Mandatory Provident Fund (MPF) should be maintained, reduced or increased under the current economic downturn? Why? (12 marks) the current rate of SMW rate is HK$37.5L the current maximum amount of employees contribution to MPF is HK$1,5002