Waso Cafe Barred from Hiring Non-Local Workers After Providing False Information to Labour Department

A restaurant in Prince Edward, Waso Cafe, has been hit with a severe administrative sanction, barring it from hiring non-local workers. The Labour Department announced on Monday that the eatery provided false information to the department during its application process to bring in essential staff, including servers, junior cooks, and dishwashers. This violation has led to the termination of Waso Cafe’s application under the Enhanced Supplementary Labour Scheme (ESLS).

The ESLS, introduced in 2023, was designed to address Hong Kong’s persistent manpower shortages, particularly in sectors like food and beverage. The scheme permits employers to hire non-local workers, predominantly from mainland China, to fill critical roles where local talent is deemed insufficient. However, the scheme mandates strict adherence to its guidelines, with a core principle being the prioritisation of local recruitment.

Following a thorough investigation, the Labour Department concluded that Waso Cafe had significantly breached the ESLS requirements. The investigation found that the restaurant had deliberately supplied inaccurate information to the government during its local recruitment exercise. This act of misrepresentation directly contravenes the spirit and letter of the scheme, which aims to supplement, not supplant, the local workforce.

"An administrative sanction is thus imposed," stated a spokesperson for the Labour Department in a press release. "Employers applying for the importation of workers under the ESLS should strictly comply with the scheme requirements, including according priority to employing suitable local workers." The department emphasised that such violations undermine the integrity of the programme and can have serious repercussions for the businesses involved.

Under the ESLS, administrative sanctions can extend beyond the immediate termination of applications. The Labour Department’s statement also indicated that previous hiring approvals granted to businesses found in violation could be withdrawn, further penalising the offending establishments and ensuring a more robust enforcement of the scheme’s objectives.

Escalating Scrutiny and Tighter Regulations

The sanction against Waso Cafe comes at a time when the government is intensifying its efforts to regulate the non-local labour scheme, particularly within the demanding food and beverage sector. In June of the current year, authorities implemented stricter rules, including a significantly altered staffing ratio. Previously, employers were only required to maintain a ratio of two local employees for every one imported worker. This has now been revised to a more stringent ratio of three local employees for every imported worker.

This policy adjustment impacts a wide array of positions within the hospitality industry, including cooks, junior cooks, waiters, receptionists, drink makers, and bar supervisors. The intention behind this tightening is to ensure that the reliance on imported labour does not displace local job opportunities or depress wages. The government aims to strike a delicate balance between addressing labour deficits and safeguarding the interests of its domestic workforce.

To further protect local employees, employers utilizing the import scheme are still obligated to offer imported labourers wages that are no less than the median monthly salary for their respective roles within the Hong Kong market. This measure aims to prevent the exploitation of imported labour and ensure that they receive fair compensation, thereby maintaining competitive wage standards for all workers in the sector.

Data on Imported Labour and Scheme Oversight

As of May 2026, the food and beverage services sector employs approximately 24,300 non-local workers under various labour importation schemes. This figure represents a significant portion, approximately 45 per cent, of the total 54,000 non-local workers currently engaged in Hong Kong under such programmes. Across all sectors covered by these schemes, a total of 110,000 imported worker applications have been approved, underscoring the significant role of foreign labour in the city’s economy.

The Labour Department has been actively monitoring the implementation of these schemes and has established channels for feedback and complaints. As of March of the current year, the government had received over 1,000 complaints related to the ESLS and other labour importation programmes. These complaints have served as a crucial mechanism for identifying potential non-compliance and initiating investigations. A notable portion of these complaints have indeed resulted in official sanctions against businesses.

Precedents of Enforcement

The case of Waso Cafe is not an isolated incident, highlighting the government’s commitment to enforcing the rules governing labour importation. In a similar instance in August of the previous year, a Chinese restaurant faced a two-year ban on hiring imported workers. This severe penalty was imposed after authorities discovered that the establishment had deliberately terminated the employment of local staff to make way for cheaper, non-local labour. This precedent underscores the serious consequences of exploiting the labour importation schemes.

Such enforcement actions serve as a clear warning to other employers operating under these schemes. The Labour Department’s vigilant approach aims to ensure that the ESLS and similar programmes function as intended – to address genuine labour shortages without compromising the employment prospects or fair wages of local workers. The focus remains on maintaining a transparent and equitable system that benefits both businesses and the broader workforce.

Broader Implications for the Hospitality Sector

The Labour Department’s stringent enforcement of the Enhanced Supplementary Labour Scheme carries significant implications for Hong Kong’s hospitality sector, which has been grappling with labour shortages for years. The recent tightening of rules, including the increased local-to-imported worker ratio, signals a strategic shift towards greater reliance on the domestic workforce. While this aims to protect local jobs, it also presents challenges for businesses that have come to depend on imported labour to maintain operations and service standards.

The incident involving Waso Cafe, and the broader trend of increased oversight, suggests a recalibration of the government’s approach to labour importation. The emphasis is clearly on ensuring that these schemes are not abused and that employers make genuine efforts to recruit and retain local talent. For restaurants and other businesses in the food and beverage industry, this necessitates a more proactive and comprehensive strategy for local recruitment and staff development. Failure to comply with the evolving regulations could lead to significant operational disruptions and reputational damage.

Furthermore, the ongoing monitoring and complaint mechanism indicate a commitment to transparency and accountability. Businesses that operate with integrity and adhere to the spirit of the ESLS are likely to find continued support. However, those that engage in deceptive practices, as Waso Cafe has been accused of, will face escalating penalties. This creates a more level playing field for all businesses and reinforces the importance of ethical employment practices within the competitive Hong Kong market.

The Labour Department’s actions serve as a critical reminder that while labour importation schemes are designed to be a supportive measure, they are not a substitute for robust local employment strategies. The future success of the hospitality sector will likely depend on a concerted effort by both the government and businesses to nurture and retain a skilled local workforce, while judiciously utilizing imported labour only when genuine shortages persist and all local recruitment avenues have been exhausted. The ongoing dialogue between industry stakeholders and the Labour Department will be crucial in navigating these complexities and ensuring a sustainable labour market for Hong Kong.