Maximum amounts of ex gratia payment items from Protection of Wages on Insolvency Fund to be raised
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The levels of ex gratia payments granted from the Protection of Wages on Insolvency Fund for employees who are owed wages, wages in lieu of notice, severance payment, pay for untaken annual leave and pay for untaken statutory holidays by their insolvent employers will be increased.
Through a resolution of the Legislative Council under the Protection of Wages on Insolvency Ordinance today (June 16), the maximum amounts of a number of ex gratia payment items under the Fund will be increased, including (a) arrears of wages from $36,000 to $80,000; (b) wages in lieu of notice from $22,500 to $45,000; (c) severance payment from $50,000 plus 50 per cent of any excess entitlement to $100,000 plus 50 per cent of any excess entitlement; and (d) pay for untaken annual leave and/or pay for untaken statutory holidays from $10,500 to $26,000.
The adjusted maximum amounts will come into effect tomorrow (June 17) upon gazettal of the resolution and will apply in respect of wages, wages in lieu of notice, severance payment, pay for untaken annual leave and pay for untaken statutory holidays, the liability of payment for which arose on or after that date. This legislative amendment is an important step in enhancing employees’ protection.
The Fund was set up in 1985 to provide timely financial relief in the form of ex gratia payment to employees of insolvent employers.