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The Protection of Wages on Insolvency (Amendment) Ordinance 2012 will take effect today (June 29).
The ordinance aims to amend the Protection of Wages on Insolvency Ordinance to expand the scope of the Fund to cover pay for untaken annual leave and untaken statutory holidays under the Employment Ordinance (EO).
The Fund provides timely relief in the form of ex gratia payment to employees of insolvent employers, which currently covers four months' wages up to $36,000, one month's wages in lieu of notice up to $22,500 and severance payment up to $50,000 plus 50 per cent of the remainder of the entitlement.
Under the ordinance, the scope of the Fund will be further expanded to cover:
(1) pay for untaken annual leave payable to an employee upon termination of employment contract under the EO including (a) pay for any untaken annual leave earned in the employee's last full leave year; and (b) pro rata annual leave pay for the last leave year where the employee has at least three but less than 12 months' service entitled upon termination of employment contract; and
(2) pay for statutory holidays under the EO not yet taken by an employee within four months before his last day of service.
Neither the amount of pay for untaken annual leave nor the amount of pay for untaken statutory holidays, nor the total amount of the two, may exceed $10,500.
To assist employees, employers and the public in understanding the law amendments, the Labour Department has published "A Concise Guide to the Protection of Wages on Insolvency (Amendment) Ordinance 2012". It is available at the department's branch offices of the Labour Relations Division and can be downloaded from the department's homepage: www.labour.gov.hk/eng/erb/content4.htm . Enquiries on the Amendment Ordinance can be made at the department's hotline 2717 1771.
Ends/Friday, June 29, 2012
Issued at HKT 10:30
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