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LCQ8: Sickness allowance
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    Following is a written reply by the Secretary for Labour and Welfare, Mr Matthew Cheung Kin-chung, to a question by the Hon Leung Kwok-hung on sickness allowance in the Legislative Council today (June 4):

Question :

    Under the Employment Ordinance (Cap. 57), if an employee has accumulated sufficient number of paid sickness days, the sick leave is supported by an appropriate medical certificate, and the sick leave taken is not less than four consecutive days, the employee shall be entitled to sickness allowance.  The daily rate of sickness allowance is a sum equivalent to four-fifths of the average daily wages earned by an employee in the 12-month period preceding the sickness day or the first sickness day.  In this connection, will the Government inform this Council:

(a)  of the number of cases received by the Labour Department in the past three years regarding failure of employers to pay sickness allowance to their employees, the trades in which the employees concerned were engaged, as well as the number of cases in which the employers concerned were prosecuted and convicted; and

(b)  whether the Government will amend the relevant legislation to raise the daily rate of sickness allowance to a sum equivalent to 100% of the average daily wages earned by an employee in the 12-month period preceding the sickness day or the first sickness day, and reduce the number of sickness days, which are required for an employee to qualify for sickness allowance, from not less than four consecutive days to not less than two consecutive days; if not, of the reasons for that?

Reply :

Madam President,

(a)  The number of cases of non-payment of sickness allowance under the Employment Ordinance (EO) was relatively small over the years. In 2005, 2006 and 2007, the number of cases of non-payment/ under-payment of sickness allowance handled by the Labour Department (LD) was 70, 84 and 67 respectively.  Similar to other labour claims, the majority of cases involving sickness allowance were amicably settled after conciliation (from past experience, around 70% of cases were successfully resolved through conciliation).  An employer who without reasonable excuse fails to pay sickness allowance to an employee is liable to prosecution.  In the said period, the number of cases of non-payment/ under-payment of sickness allowance in which the employers concerned were convicted stood at 6, 3 and 2 respectively.  They were mainly involved in the transport, storage and communications sector, followed by the import/export trades sector and the community, social and personal services sector.

(b)  Under the EO, an employee is entitled to sickness allowance if he takes not less than four consecutive days of sick leave and fulfils other statutory requirements (e.g. number of paid sickness days accumulated).  The daily rate of sickness allowance is a sum equivalent to four-fifths of the employee's average daily wages.

    Unlike temporary incapacity resulting from work-related injury, an employee's absence from work because of illness may not be employment-related.  Therefore, in apportioning the financial burden arising from an employee's illness, there is a need to maintain a reasonable balance between the interests of employers and employees.  Furthermore, an employee's need for financial assistance during short-term sick leave is relatively small.  Given that sickness allowance is payable for sick leave taken for four consecutive days or more, the present provisions have served to ensure that the livelihood of employees will not be adversely affected if they have a prolonged period of illness.

    Since the introduction of sickness allowance in the EO, we have from time to time reviewed the relevant provisions and implemented a number of improvement measures.  The maximum number of paid sickness days that can be accumulated was increased from 24 initially to 36, and later rose significantly to the present level of 120 days.  The rate of sickness allowance was raised from one half to two-thirds and then to the present level of four-fifths of an employee's wages.  The medical professionals recognized under the EO for certifying an employee's incapability of work in consequence of sickness or injury have also been extended from registered medical practitioners to registered dentists and then to registered Chinese medicine practitioners, thus affording employees the freedom to choose the suitable treatment in respect of their sickness or injury. 

    In fact, the stipulation under the EO for a period of not less than four consecutive days of sick leave is broadly comparable to that of other countries/regions (e.g. four consecutive days in the UK, France, Japan and Taiwan).  The current rate of sickness allowance in Hong Kong is also higher than that in some neighbouring regions and developed countries (e.g. Taiwan, Japan and France at around 50% to 66% of the employee's wages).

    The rights and benefits afforded by the EO to all employees are only the minimum standards to which employees are entitled and with which employers must comply.  We have all along been encouraging employers to adopt employee-oriented management policies and, in consultation with their employees, offer employment conditions that are more favourable than those provided under the EO.

    We are of the view that the current provisions under the EO on sickness allowance are commensurate with the socio-economic development of Hong Kong and have struck a reasonable balance between the interests of employees and employers.  At present, we have no plan to make any amendments in this regard.  Nevertheless, we will, as in the past, keep abreast of the times and continue to review our labour legislation from time to time in the light of the pace of our socio-economic development and consider whether there is a need to improve employees'benefits when appropriate.

Ends/Wednesday, June 4, 2008
Issued at HKT 12:46

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