PROTECTION OF WAGES ON INSOLVENCY ORDINANCE
PROTECTION OF WAGES ON INSOLVENCY ORDINANCE
(CHAPTER 380)
CONTENTS
Section
PART I PRELIMINARY
1. Short title
2. Interpretation
PART II PROTECTION OF WAGES ON INSOLVENCY FUND BOARD
3. Establishment and incorporation of Wages on Insolvency Fund Board
4. Functions and powers of the Board
5. Board to be subject to directions of the Governor in Council
PART III FUND
6. Establishment of Protection of Wages on Insolvency Fund
7. Payments from the Fund
PART IV FINANCIAL PROVISIONS
8. Financial year and estimates
9. Bank account
10. Investment of moneys
11. Accounts
12. Auditors
13. Statements and reports to be laid on table of Legislative Council
14. Costs of administering the Fund
PART V PAYMENT FROM THE FUND
15. Entitlement to apply for ex gratia payment
16. Payment
17. Review by Board
18. Additional power of Commissioner
19. Verification of application
20. Decisions under this Part not to be challenged
21. Power of Commissioner to delegate
22. Payment not to affect right to legal aid
23. Proof by certificate
PART VI RECOVERY OF PAYMENTS
24. Subrogation
25. Recovery of payment made by mistake
PART VII MISCELLANEOUS
26. Offences
27. Regulations
28. Power of Governor to amend Schedule
29. Transitional
Schedule Protection of Wages on Insolvency Fund Board
To provide for the establishment of a board to administer the Protection
of Wages on Insolvency Fund, to provide for payment of monies from the
Fund to employees whose employers become insolvent; and for matters
connected therewith or incidental thereto.
[19 April 1985] L. N. 100 of 1985
PART I PRELIMINARY
1. Short title
This Ordinance may be cited as the Protection of Wages on Insolvency
Ordinance.
2. Interpretation
In this Ordinance, unless the context otherwise requires-
"applicant" means any person who would, on the winding up of a company, be
entitled to priority under section 265 (1) (b), (c), (ca) or (cc) of the
Companies Ordinance (Cap. 32) or who would, on a bankruptcy, be entitled
to priority under section 38 (1) (b), (c), (ca) or (cc) of the Bankruptcy
Ordinance (Cap. 6) other than a person whose employer is an individual and
who is a member of the family of that employer and who dwells in the same
dwelling as that employer; (Amended 48 of 1987 s. 2; 38 of 1989 s. 2)
"bankruptcy petition" means a bankruptcy petition under the Bankruptcy
Ordinance (Cap. 6);
"Board" means the Protection of Wages on Insolvency Fund Board established
by section 3;
"Commissioner" means the Commissioner for Labour;
"company" means any body which is liable to be wound up under the
Companies Ordinance (Cap. 32);
"financial year" means the financial year of the Fund fixed under section
8; "Fund" means the Protection of Wages on Insolvency Fund referred to in
section 6;
"levy" has the meaning assigned to it by section 2 of the Business
Registration Ordinance (Cap. 310);
* "severance payment" means a severance payment payable by an employer to
an employee under section 31B (1) of the Employment Ordinance (Cap. 57);
(Replaced 45 of 1991 s. 2)
* * "wages" means wages or salary in respect of
which an applicant would, on the winding up of a company, be entitled to
priority under section 265 (1) (b) or (c) of the Companies Ordinance (Cap.
32) or who would, on a bankruptcy, be entitled to priority under section
38 (1) (b) or (c) of the Bankruptcy Ordinance (Cap. 6), save that the
amount specified in section 265 (1) (b) or (c) of the Companies Ordinance
(Cap. 32) or section 38 (1) (b) or (c) of the Bankruptcy Ordinance (Cap.
6) (as the case may be) as the maximum amount in respect of which an
applicant would be entitled to priority, or any amount substituted
therefor under section 265 (1A) or (1B) of the Companies Ordinance (Cap.
32) or (as the case may be) section 38 (2), (2A) or (2B) of the Bankruptcy
Ordinance (Cap. 6), shall not apply; (Amended 15 of 1993 s. 2)
* * "wages in lieu of notice" means wages in lieu of notice in respect of
which an applicant would, on the winding up of a company, be entitled to
priority under section 265 (1) (cc) of the Companies Ordinance (Cap. 32),
or would, in a bankruptcy, be entitled to priority under section 38 (1)
(cc) of the Bankruptcy Ordinance (Cap. 6), save that the amount specified
in section 265 (1) (cc) of the Companies Ordinance (Cap. 32) or section 38
(1) (cc) of the Bankruptcy Ordinance (Cap. 6) (as the case may be) as the
maximum amount in respect of which an applicant would be entitled to
priority shall not apply; (Added 48 of 1987 s. 2. Amended 15 of 1993 s. 2)
"winding-up petition" means a winding-up petition under Part V or X of the
Companies Ordinance (Cap. 32).
PART II PROTECTION OF WAGES ON INSOLVENCY FUND BOARD
3. Establishment and incorporation of Wages on Insolvency Fund Board
(1) There is hereby established a board to be known as the Protection of
Wages on Insolvency Fund Board and in the Chinese language as which shall
be a body corporate.
(2) The Board shall consist of a Chairman appointed under the Schedule and
not more than 10 members appointed by the Governor as follows-
(a) subject to paragraph (b) not more than 4 public officers;
(b) equal numbers of persons who, in his opinion, represent employers and
persons who, in his opinion, represent employees.
(3) The Governor shall give notice of each appointment by notice in the
Gazette.
(4) The Schedule shall have effect with respect to the Board.
4. Functions and powers of the Board
(1) The Board shall have the following functions-
(a) to administer the Fund;
(b) to make recommendations to the Governor with respect to the rate of
levy; and
(c) to perform such other duties as are imposed or other powers as are
conferred on it by this Ordinance.
(2) The Board may do all such things as are necessary for, or incidental
or conducive to, the better carrying out of the functions of the Board and
may in particular, but without prejudice to the generality of the
foregoing-
(a) hold, acquire or lease all kinds of property whether movable or
immovable;
(b) sell or otherwise dispose of all kinds of property whether movable or
immovable;
(c) subject to section 10, invest its funds in such manner and to such
extent as it thinks necessary or expedient; and
(d) with the prior consent of the Financial Secretary, borrow money in
such manner and on such securities or terms as it thinks expedient.
5. Board to be subject to directions of the Governor in Council
The Governor in Council may give to the Board such directions as he thinks
fit with respect to the exercise of its functions under this Ordinance and
the Board shall comply with any such direction.
PART III FUND
6. Establishment of Protection of Wages on Insolvency Fund
The fund known as the Protection of Wages on Insolvency Fund established
under the provisions of section 21 of the Business Registration Ordinance
(Cap. 310) in force immediately before the commencement of this Ordinance
shall be deemed to be established and continue in existence under this
section, and shall consist of-
(a) moneys that are paid by the Commissioner of Inland Revenue under that
section whether paid before or after the commencement of this Ordinance;
(b) moneys recovered under Part VI;
(c) interest and other income derived from the moneys and investments
comprising the Fund; and
(d) other moneys lawfully paid into the Fund.
7. Payments from the Fund
There shall be paid from the Fund the following-
(a) payments to applicants under section 16;
(b) expenses incurred by the Board for the purposes of this Ordinance;
(c) capital, interest and charges in respect of any loan; and
(d) any other sums required or permitted to be paid by the Fund under this
Ordinance.
PART IV FINANCIAL PROVISIONS
8. Financial year and estimates
(1) The Board may, from time to time, with the prior approval of the
Governor, fix a period to be the financial year of the Fund.
(2) In each financial year, before a date to be fixed by the Governor, the
Board shall submit to the Governor, for his approval, estimates of the
income and expenditure of the Fund for the next financial year:
Provided that the estimates for the first financial year of the Fund shall
be submitted as soon as practicable after the commencement of this
Ordinance.
(3) The Governor shall consider the estimates submitted to him under
subsection (2) and may approve or reject them and, in the case of
rejection, may require the Board to resubmit the estimates modified in
such manner and within such time as the Governor may direct.
(4) The Board may, from time to time, vary the estimates approved under
subsection (3) and shall, as soon as practicable, deliver to the Governor
a statement in writing containing details of any variation.
9. Bank account
The Board shall open and maintain an account with a bank approved by the
Financial Secretary and shall pay all moneys of the Fund into that
account.
10. Investment of moneys
All moneys of the Fund that are not immediately required by the Board may
be-
(a) deposited on fixed term or call deposit or in a savings account in
any bank licensed under the Banking Ordinance (Cap. 155); or
(b) with the prior approval of the Financial Secretary, invested in such
other investments as the Board thinks fit.
11. Accounts
The Board shall-
(a) keep and maintain such accounts and records of all transactions of the
Fund as the Director of Accounting Services may require; and
(b) after the end of each financial year cause to be prepared a statement
of the accounts of the Fund which shall include an income and expenditure
account and balance sheet and shall be signed by the Chairman.
12. Auditors
(1) The Board shall at the commencement of each financial year appoint
auditors, who shall be entitled to have access to all books of account,
vouchers and other records kept by the Board and to require such
information and explanations as they may think fit.
(2) The auditors shall audit the statement of accounts prepared under
section 11 and shall report thereon to the Board.
13. Statements and reports to be laid on table of Legislative Council
(1) The Board shall, within 6 months after the end of each financial year
or such further time as the Governor may for any particular year allow,
submit to the Governor a report on the activities of the Board for that
financial year including copies of the statement of accounts prepared
under section 11 and the report made under section 12.
(2) The Governor shall cause the reports and statements received by him
under subsection
(1) to be laid on the table of the Legislative Council.
14. Costs of administering the Fund
(1) All costs and expenses incurred by the Government in administering the
Fund shall be a charge upon general revenue.
(2) The Financial Secretary may direct that a supervision fee to be
determined by him, in relation to such period as may be determined by him,
shall be charged against the income of the Fund and shall at a time
determined by him be paid to him by the Board from the Fund and paid by
him into general revenue.
PART V PAYMENT FROM THE FUND
15. Entitlement to apply for ex gratia payment
(1) Subject to this Part, an applicant to whom-
(a) wages are due and unpaid;
(b) wages in lieu of notice are due and unpaid; or
(c) the liability to be paid a severance payment has arisen and the
severance payment is unpaid, whether or not the severance payment is then
due, may apply for an ex gratia payment from the Fund in respect of the
wages, wages in lieu of notice or the severance payment, as the case may
be, or all or any of them. (Replaced 38 of 1989 s. 3)
(2) An application under subsection (1) (in this Part called an
"application" ) shall be made to the Commissioner in writing in a form
approved by him. (Amended 48 of 1987 s. 3)
(3) No applicant shall apply for payment from the Fund in respect of any
wages for services rendered before 1 April 1985.
(4) No applicant shall apply for payment from the Fund in respect of wages
in lieu of notice arising out of a contract of employment terminated
before the commencement of the Protection of Wages on Insolvency
(Amendment) Ordinance 1987 (48 of 1987). (Added 48 of 1987 s. 3)
(5) No applicant shall apply for payment from the Fund in respect of a
severance payment the liability for payment of which arose before the
commencement of the Protection of Wages on Insolvency (Amendment)
Ordinance 1989 (38 of 1989). (Added 38 of 1989 s. 3)
16. Payment
(1) Subject to subsections (1B) and (2) where it appears to the
Commissioner that an employer has failed to pay any wages, wages in lieu
of notice or severance payment, as the case may be, or all or any of them
to an applicant and that-
(a) in the case of an employer who is not a company-
(i) a bankruptcy petition has been presented against him; or
(ii) he has committed an act of bankruptcy within the meaning of section 3
of the Bankruptcy Ordinance (Cap. 6) but a petition cannot be presented
against him by reason of section 6 (1) (a) of that Ordinance; or (Replaced
41 of 1988 s. 2)
(b) in the case of an employer who is a company, a winding-uppetition has
been presented against that employer,
he may make an ex gratia payment to the applicant out of the Fund of the
amount of the wages, wages in lieu of notice or severance payment, as the
case may be, or all or any of them.
(1A) When the Commissioner makes a payment under subsection (1) (a) (ii),
he shall give notice of the payment and the reasons therefor in the
Gazette. (Added 41 of 1988 s. 2)
(1B) Where an application has been made in respect of a severance payment
which is not due at the date of the application, the Commissioner may
defer consideration of the application until the severance payment becomes
due. (Added 38 of 1989 s. 4)
(2) The Commissioner shall not make any payment under subsection (1)-
(a) to the applicant unless the applicant has verified his application by
a statutory declaration in a form approved by the Commissioner;
* (b) of an amount exceeding $18,000 in respect of wages; (Replaced 15 of
1993 s. 3)
* (c) (Repealed 15 of 1993 s. 3)
(d) in respect of wages for services rendered more than 4 months prior to
the date of application;
(e) in respect of wages in lieu of notice-
* (i) of an amount exceeding-
(A) the equivalent of 1 month's wages of the applicant; or
(B) $6,000,
whichever is the lesser; or (Amended 15 of 1993 s. 3)
(ii) subject to subsection (2A), which became due more than 4 months prior
to the date of application; or (Replaced 38 of 1989 s. 4)
(f) in respect of a severance payment-
(i) of an amount exceeding the aggregate of $8,000 and half of that part
of the applicant's entitlement to severance payment in excess of $8,000;
or (Replaced 45 of 1991 s. 3)
(ii) the liability for payment of which arose more than 4 months prior to
the date of application. (Added 38 of 1989 s. 4)
(2A) Subsection (2) (e) (ii) shall not apply to wages in lieu of notice
arising out of a contract of employment terminated before the commencement
of the Protection of Wages on Insolvency (Amendment) Ordinance 1989 (38 of
1989). (Added 38 of 1989 s. 4)
* (3) The Legislative Council may be
resolution amend the period specified in subsection (2) (e) (i) (A) or the
amount specified in subsection (2) (b), (e) (i) (B) or (f) (i). (Added 48
of 1987 s. 4. Amended 15 of 1993 s. 3)
(Amended 48 of 1987 s. 4; 38 of 1989 s. 4)
17. Review by Board
(1) Any applicant aggrieved by any decision of the Commissioner under
section 16 may in writing-
(a) request the Commissioner to give reasons for that decision; and
(b) after being given reasons under paragraph (a), request the
Commissioner to refer the application to the Board.
(2) Upon receiving a request from an applicant under subsection (1) (b),
the Commissioner shall forward all documents relating to the application
to the Chairman of the Board.
(3) The Board may confirm or vary any decision of the Commissioner on an
application referred to it under this section or may for those purposes
require the Commissioner to make further inquiries relating to the
application.
18. Additional power of Commissioner
(1) Notwithstanding that in any particular case a petition referred to in
section 16 (1) (a) (i) or (b) has not been presented against an employer,
the Commissioner may, subject to subsection (2) of that section, make an
ex gratia payment under that section in that case if in his opinion-
(Amended, 41 of 1988 s. 3)
(a) the employer employs less than 20 employees;
(b) sufficient evidence exists to support the presentation of a petition
in that case on the ground-
(i) if the employer is a company, that he is unable to pay his debts; or
(ii) if the employer is a person other than a company, that he has
committed an act of bankruptcy; and
(c) it is unreasonable or uneconomic to present a petition in that case.
(2) Where the Commissioner exercises his discretion under subsection (1)
to make payment, he shall give notice in the Gazette stating that, in his
opinion, sufficient evidence exists to support the presentation of a
petition on the ground-
(a) if the employer is a company, that he is unable to pay his debts; or
(b) if the employer is a person other than a company, that he has
committed an act of bankruptcy.
(3) Nothing in subsection (2) shall require the Commissioner to give more
than one notice in respect of each employer.
(4) No action shall lie against the Commissioner in respect of any notice
given under subsection (2).
19. Verification of application
(1) For the purpose of verifying any application under section 15, or if
so required by the Board under section 17 (3), the Commissioner may make
such inquiries as he thinks fit and may in particular, but without
limiting the generality of the foregoing and without prejudice to any
powers of the Commissioner under any other Ordinance-
(a) interview the applicant and any other employee;
(b) by notice in writing require the applicant or any other person having
possession thereof to produce to the Commissioner for his inspection any
record, book of account, or other document as may, in the opinion of the
Commissioner, be necessary to verify the application;
(c) by notice in writing require any person whom he reasonably believes to
have possession thereof to produce to the Commissioner for his inspection
any register, record or other document required to be kept by an employer
under the Employment Ordinance (Cap. 57); and
(d) by notice in writing require the employer to whom the application
relates or any servant, agent or employee of that employer to attend
before him and to answer questions put by him.
(2) Any notice served by the Commissioner imposing any requirement under
this section, shall state the time when and place where the person to whom
the notice is given shall comply with that requirement.
(3) Any notice to be served on any person under this section may be served
by post.
(4) In relation to the Commissioner's powers under subsection (1) to make
inquiries-
(a) any person required to answer questions shall have, in relation to any
answer thereto, such privileges as he would have had, had such question
been asked in a court but shall otherwise answer any such question;
(b) the Commissioner shall proceed as informal as possible and may
determine the procedure to be followed.
20. Decisions under this Part not to be challenged
No decision of the Commissioner or the Board made in exercise of any
discretion under this Part shall be challenged in any Court.
21. Power of Commissioner to delegate
(1) The Commissioner may, in writing, authorize any officer of the Labour
Department to exercise any of his powers or perform any of his duties
under this Part.
(2) In this Part but not in subsection (1)
"Commissioner" includes any person authorized by the Commissioner under
this section.
22. Payment not to affect right to legal aid
Any right of an applicant to receive legal aid under the Legal Aid
Ordinance (Cap. 91) shall not be affected by any payment made under
section 16 if the purpose of such legal aid is to assist the applicant to
recover any further amount due to him under any contract of employment or
under the Employment Ordinance (Cap. 57).
23. Proof by certificate
(1) A document purporting to be under the hand of the Commissioner stating
that-
(a) on the date specified therein the sum of money stated therein was paid
from the Fund to the person named therein; and
(b) immediately before that date the employer named therein owed to that
person the amount of wages, wages in lieu of notice or severance payment,
as the case may be, or all or any of them, specified therein in respect of
the period or periods stated therein, (Replaced 38 of 1989 s. 5)
shall be admissible in any proceedings on its production and without
further proof and, until the contrary is proved or unless it be shown that
the document was not under the hand of the Commissioner, shall be prima
facie evidence of the facts stated therein. (Replaced 48 of 1987 s. 5)
(2) In this section "proceedings" includes the lodging of a proof of debt
in any bankruptcy or winding-up.
PART VI RECOVERY OF PAYMENTS
24. Subrogation
(1) Where a payment is made under section 16 to an applicant in respect of
wages due to him, or in respect of any liability to pay him a severance
payment, whether or not the severance payment is due when that payment
under section 16 is made, all his rights and remedies with respect to
those wages or severance payment, as the case may be, existing immediately
before that payment under section 16 shall, to the extent of the amount of
that payment under section 16, be transferred to and vest in the Board for
the benefit of the Fund and the Board may take such steps as it considers
necessary to enforce those rights and remedies.
(2) The rights and remedies of an applicant in respect of a severance
payment transferred to and vested in the Board pursuant to subsection (1)
shall include the rights and remedies of the applicant in respect of so
much of that severance payment as the applicant would, on the winding up
of a company, be entitled to priority under section 265 (1) (ca) of the
Companies Ordinance (Cap. 32) or would, on a bankruptcy, be entitled to
priority under section 38 (1) (ca) of the Bankruptcy Ordinance (Cap. 6).
(Replaced 45 of 1991 s. 4)
(2A) Where-
(a) the amount of any wages due to an applicant exceeds the amount of any
payment made to him under section 16 in respect of those wages, nothing in
this section shall affect the rights or remedies of the applicant in
respect of the amount of the excess;
(b) the amount of any liability in respect of the payment to an applicant
of a severance payment exceeds the amount of any payment made to him under
section 16 in respect of the severance payment, the rights or remedies of
the applicant in respect of the amount of the excess shall be subject to
the rights and remedies of the applicant in respect of the severance
payment transferred to and vested in the Board pursuant to subsection (1).
(Added 45 of 1991 s. 4)
(3) In this section "wages" includes wages in lieu of notice. (Added 48 of
1987 s. 6) (Amended 38 of 1989 s. 6)
25. Recovery of payment made by mistake
Where-
(a) any payment is made to any person from the Fund under a mistake of law
or fact; or
(b) notwithstanding that no person has beer charged with or convicted of
an offence under section 26, any payment is made to any person, in respect
of an application that is false in any material particular,
such payment shall be recoverable by the Board from the recipient thereof
as a debt due to the Board.
PART VII MISCELLANEOUS
26. Offences
(1) Any person who-
(a) in providing information for the purposes of this Ordinance including
any inquiry thereunder, makes any statement which he knows to be false in
a material particular or recklessly makes a statement which is false in a
material particular; or
(b) for the purposes of this Ordinance including any inquiry thereunder
and with intent to deceive, produces, supplies or sends, or otherwise
makes use of, any document or record which is false in a material
particular,
commits an offence and is liable to a fine of $50,000 and to imprisonment
for 3 months.
(2) Any person who, without reasonable excuse, fails to comply with any
requirement imposed by the Commissioner under section 19 (1) or (4)
commits an offence and is liable to a fine of $ 5,000 and to imprisonment
for 1 month.
(3) Without prejudice to any Ordinance relating to the prosecution of
offences or to the powers of the Attorney General in respect of the
prosecution of criminal offences, a prosecution for any offence under this
Ordinance may be brought in the name of the Commissioner and commenced and
conducted by an officer of the Labour Department authorized in that behalf
in writing by the Commissioner.
(4) Where a complaint is made or an information laid for an offence under
this Ordinance by the Commissioner or any officer authorized under
subsection (3), the complainant or informant shall, for the purposes of
section 8 (1B) of the Magistrates Ordinance (Cap. 227), be deemed to be
acting on behalf of the Attorney General.
27. Regulations
The Governor in Council may be regulations-
(a) prescribe anything required or permitted to be prescribed under this
Ordinance;
(b) provide for the better carrying into effect of the provisions of this
Ordinance.
28. Power of Governor to amend Schedule
The Governor may by notice in the Gazette amend the Schedule.
29. Transitional
The Protection of Wages on Insolvency (Amendment) Ordinance 1987 (48 of
1987) ("the amending Ordinance") shall apply to and in relation to any
payment to be made in accordance with section 38 of the Bankruptcy
Ordinance (Cap. 6), or section 265 of the Companies Ordinance (Cap. 32),
after the Commencement of the amending Ordinance, notwithstanding that any
debt to which such payment relates was incurred before that commencement.
(Incorporated 48 of 1987 s. 9)
SCHEDULE [ss. 3 & 28] PROTECTION OF WAGES ON INSOLVENCY FUND BOARD
1. Status of Board
The Board shall not be the servant or agent of the Crown nor shall it
enjoy any status, immunity or privilege of the Crown.
2. Seal
(1) The Board shall have a common seal, the affixing of which shall be
authenticated by the signature of any 2 members.
(2) Any document purporting to be a document duly executed under the seal
of the Board shall be received in evidence and shall, unless the contrary
is proved, be deemed to be a document so executed.
3. Tenure of members
(1) A member of the Board who is not a public officer shall, unless his
appointment is terminated or otherwise ceases, hold office for such period
as the Governor may specify.
(2) On the expiry of his period of appointment or re-appointment, any
member to whom subparagraph (1) applies shall be eligible for
re-appointment for such further term as the Governor may specify.
(3) Any member to whom subparagraph (1) applies may at any time resign
from office by giving notice in writing to the Governor, and he shall
cease to be a member from the date specified in the notice or, if no date
is specified, from the date of the receipt by the Governor of the notice.
(4) If any member of the Board. other than the Chairman, is absent from
Hong Kong or is for any other reason unable to exercise the powers or
perform the duties of his office as member, the Governor may appoint
another person to be a temporary member in his place during his absence or
incapacity.
4. Chairman
(1) The Governor shall appoint a person to be Chairman of the Board and
shall give notice of such appointment by notice in the Gazette.
(2) If the Chairman is absent from Hong Kong or is for any other reason
unable to act as Chairman, the Governor may appoint another person to be
Chairman in his place during his absence or incapacity and shall give
notice of such appointment by notice in the Gazette.
(3) At any meeting of the Board the Chairman shall have a casting vote in
addition to a deliberative vote.
5. Meetings and proceedings of the Board
(1) Meetings of the Board shall be held at such times and places as the
Chairman or person acting as Chairman may appoint.
(2) The quorum for meetings of the Board shall be 5.
(3) Subject to this Schedule the Board may determine its own procedure.
6. Transaction of business by circulation of papers
The Board may transact any of its business by the circulation of papers,
and a resolution in writing which is approved by a majority of the members
shall be valid and effectual as if it had been passed at a meeting of the
Board by the votes of its members so approving the resolution.
7. Board may delegate to Commissioner
The Board may by resolution, with or without restrictions or conditions as
it thinks fit, delegate in writing to the Commissioner any of its powers
and duties other than its power under section 4 (1) (b) or 17 (3).
8. Committees
The Board may create and appoint such committees for any general or
special purposes as it thinks fit and, in relation to such committees, -
(a) the Chairman shall be appointed by the Board; and
(b) the Chairman and at least 2 out of every 3 persons appointed to a
committee shall be members of the Board.
9. Board may delegate to Committee
The Board may by resolution, with or without restrictions or conditions as
it thinks fit, delegate in writing to any committee appointed under
paragraph 8 any of its powers and duties other than its power under
section 4 (1) (b) or 17 (3).
Note: Section 4 of 15 of 1993 which amended the Protection of Wages on
Insolvency Ordinance is a transitional provision that affects this
Ordinance.
rnor a report on the activities of the Board for that
financial year including copies of the statement of accounts prepared
under section 11 and the report made under section 12.
(2) The Governor shall cause the reports and statements received by him
under subsection
(1) to be laid on the table of the Legislative Council.
14. Costs of administering the Fund
(1) All costs and expenses incurred by the Government in administering the
Fund shall be a charge upon general revenue.
(2) The Financial Secretary may direct that a supervision fee to be
determined by him, in relation to such period as may be determined by him,
shall be charged against the income of the Fund and shall at a time
determined by him be paid to him by the Board from the Fund and paid by
him into general revenue.
PART V PAYMENT FROM THE FUND
15. Entitlement to apply for ex gratia payment
(1) Subject to this Part, an applicant to whom-
(a) wages are due and unpaid;
(b) wages in lieu of notice are due and unpaid; or
(c) the liability to be paid a severance payment has arisen and the
severance payment is unpaid, whether or not the severance payment is then
due, may apply for an ex gratia payment from the Fund in respect of the
wages, wages in lieu of notice or the severance payment, as the case may
be, or all or any of them. (Replaced 38 of 1989 s. 3)
(2) An application under subsection (1) (in this Part called an
"application" ) shall be made to the Commissioner in writing in a form
approved by him. (Amended 48 of 1987 s. 3)
(3) No applicant shall apply for payment from the Fund in respect of any
wages for services rendered before 1 April 1985.
(4) No applicant shall apply for payment from the Fund in respect of wages
in lieu of notice arising out of a contract of employment terminated
before the commencement of the Protection of Wages on Insolvency
(Amendment) Ordinance 1987 (48 of 1987). (Added 48 of 1987 s. 3)
(5) No applicant shall apply for payment from the Fund in respect of a
severance payment the liability for payment of which arose before the
commencement of the Protection of Wages on Insolvency (Amendment)
Ordinance 1989 (38 of 1989). (Added 38 of 1989 s. 3)
16. Payment
(1) Subject to subsections (1B) and (2) where it appears to the
Commissioner that an employer has failed to pay any wages, wages in lieu
of notice or severance payment, as the case may be, or all or any of them
to an applicant and that-
(a) in the case of an employer who is not a company-
(i) a bankruptcy petition has been presented against him; or
(ii) he has committed an act of bankruptcy within the meaning of section 3
of the Bankruptcy Ordinance (Cap. 6) but a petition cannot be presented
against him by reason of section 6 (1) (a) of that Ordinance; or (Replaced
41 of 1988 s. 2)
(b) in the case of an employer who is a company, a winding-uppetition has
been presented against that employer,
he may make an ex gratia payment to the applicant out of the Fund of the
amount of the wages, wages in lieu of notice or severance payment, as the
case may be, or all or any of them.
(1A) When the Commissioner makes a payment under subsection (1) (a) (ii),
he shall give notice of the payment and the reasons therefor in the
Gazette. (Added 41 of 1988 s. 2)
(1B) Where an application has been made in respect of a severance payment
which is not due at the date of the application, the Commissioner may
defer consideration of the application until the severance payment becomes
due. (Added 38 of 1989 s. 4)
(2) The Commissioner shall not make any payment under subsection (1)-
(a) to the applicant unless the applicant has verified his application by
a statutory declaration in a form approved by the Commissioner;
* (b) of an amount exceeding $18,000 in respect of wages; (Replaced 15 of
1993 s. 3)
* (c) (Repealed 15 of 1993 s. 3)
(d) in respect of wages for services rendered more than 4 months prior to
the date of application;
(e) in respect of wages in lieu of notice-
* (i) of an amount exceeding-
(A) the equivalent of 1 month's wages of the applicant; or
(B) $6,000,
whichever is the lesser; or (Amended 15 of 1993 s. 3)
(ii) subject to subsection (2A), which became due more than 4 months prior
to the date of application; or (Replaced 38 of 1989 s. 4)
(f) in respect of a severance payment-
(i) of an amount exceeding the aggregate of $8,000 and half of that part
of the applicant's entitlement to severance payment in excess of $8,000;
or (Replaced 45 of 1991 s. 3)
(ii) the liability for payment of which arose more than 4 months prior to
the date of application. (Added 38 of 1989 s. 4)
(2A) Subsection (2) (e) (ii) shall not apply to wages in lieu of notice
arising out of a contract of employment terminated before the commencement
of the Protection of Wages on Insolvency (Amendment) Ordinance 1989 (38 of
1989). (Added 38 of 1989 s. 4)
* (3) The Legislative Council may be
resolution amend the period specified in subsection (2) (e) (i) (A) or the
amount specified in subsection (2) (b), (e) (i) (B) or (f) (i). (Added 48
of 1987 s. 4. Amended 15 of 1993 s. 3)
(Amended 48 of 1987 s. 4; 38 of 1989 s. 4)
17. Review by Board
(1) Any applicant aggrieved by any decision of the Commissioner under
section 16 may in writing-
(a) request the Commissioner to give reasons for that decision; and
(b) after being given reasons under paragraph (a), request the
Commissioner to refer the application to the Board.
(2) Upon receiving a request from an applicant under subsection (1) (b),
the Commissioner shall forward all documents relating to the application
to the Chairman of the Board.
(3) The Board may confirm or vary any decision of the Commissioner on an
application referred to it under this section or may for those purposes
require the Commissioner to make further inquiries relating to the
application.
18. Additional power of Commissioner
(1) Notwithstanding that in any particular case a petition referred to in
section 16 (1) (a) (i) or (b) has not been presented against an employer,
the Commissioner may, subject to subsection (2) of that section, make an
ex gratia payment under that section in that case if in his opinion-
(Amended, 41 of 1988 s. 3)
(a) the employer employs less than 20 employees;
(b) sufficient evidence exists to support the presentation of a petition
in that case on the ground-
(i) if the employer is a company, that he is unable to pay his debts; or
(ii) if the employer is a person other than a company, that he has
committed an act of bankruptcy; and
(c) it is unreasonable or uneconomic to present a petition in that case.
(2) Where the Commissioner exercises his discretion under subsection (1)
to make payment, he shall give notice in the Gazette stating that, in his
opinion, sufficient evidence exists to support the presentation of a
petition on the ground-
(a) if the employer is a company, that he is unable to pay his debts; or
(b) if the employer is a person other than a company, that he has
committed an act of bankruptcy.
(3) Nothing in subsection (2) shall require the Commissioner to give more
than one notice in respect of each employer.
(4) No action shall lie against the Commissioner in respect of any notice
given under subsection (2).
19. Verification of application
(1) For the purpose of verifying any application under section 15, or if
so required by the Board under section 17 (3), the Commissioner may make
such inquiries as he thinks fit and may in particular, but without
limiting the generality of the foregoing and without prejudice to any
powers of the Commissioner under any other Ordinance-
(a) interview the applicant and any other employee;
(b) by notice in writing require the applicant or any other person having
possession thereof to produce to the Commissioner for his inspection any
record, book of account, or other document as may, in the opinion of the
Commissioner, be necessary to verify the application;
(c) by notice in writing require any person whom he reasonably believes to
have possession thereof to produce to the Commissioner for his inspection
any register, record or other document required to be kept by an employer
under the Employment Ordinance (Cap. 57); and
(d) by notice in writing require the employer to whom the application
relates or any servant, agent or employee of that employer to attend
before him and to answer questions put by him.
(2) Any notice served by the Commissioner imposing any requirement under
this section, shall state the time when and place where the person to whom
the notice is given shall comply with that requirement.
(3) Any notice to be served on any person under this section may be served
by post.
(4) In relation to the Commissioner's powers under subsection (1) to make
inquiries-
(a) any person required to answer questions shall have, in relation to any
answer thereto, such privileges as he would have had, had such question
been asked in a court but shall otherwise answer any such question;
(b) the Commissioner shall proceed as informal as possible and may
determine the procedure to be followed.
20. Decisions under this Part not to be challenged
No decision of the Commissioner or the Board made in exercise of any
discretion under this Part shall be challenged in any Court.
21. Power of Commissioner to delegate
(1) The Commissioner may, in writing, authorize any officer of the Labour
Department to exercise any of his powers or perform any of his duties
under this Part.
(2) In this Part but not in subsection (1)
"Commissioner" includes any person authorized by the Commissioner under
this section.
22. Payment not to affect right to legal aid
Any right of an applicant to receive legal aid under the Legal Aid
Ordinance (Cap. 91) shall not be affected by any payment made under
section 16 if the purpose of such legal aid is to assist the applicant to
recover any further amount due to him under any contract of employment or
under the Employment Ordinance (Cap. 57).
23. Proof by certificate
(1) A document purporting to be under the hand of the Commissioner stating
that-
(a) on the date specified therein the sum of money stated therein was paid
from the Fund to the person named therein; and
(b) immediately before that date the employer named therein owed to that
person the amount of wages, wages in lieu of notice or severance payment,
as the case may be, or all or any of them, specified therein in respect of
the period or periods stated therein, (Replaced 38 of 1989 s. 5)
shall be admissible in any proceedings on its production and without
further proof and, until the contrary is proved or unless it be shown that
the document was not under the hand of the Commissioner, shall be prima
facie evidence of the facts stated therein. (Replaced 48 of 1987 s. 5)
(2) In this section "proceedings" includes the lodging of a proof of debt
in any bankruptcy or winding-up.
PART VI RECOVERY OF PAYMENTS
24. Subrogation
(1) Where a payment is made under section 16 to an applicant in respect of
wages due to him, or in respect of any liability to pay him a severance
payment, whether or not the severance payment is due when that payment
under section 16 is made, all his rights and remedies with respect to
those wages or severance payment, as the case may be, existing immediately
before that payment under section 16 shall, to the extent of the amount of
that payment under section 16, be transferred to and vest in the Board for
the benefit of the Fund and the Board may take such steps as it considers
necessary to enforce those rights and remedies.
(2) The rights and remedies of an applicant in respect of a severance
payment transferred to and vested in the Board pursuant to subsection (1)
shall include the rights and remedies of the applicant in respect of so
much of that severance payment as the applicant would, on the winding up
of a company, be entitled to priority under section 265 (1) (ca) of the
Companies Ordinance (Cap. 32) or would, on a bankruptcy, be entitled to
priority under section 38 (1) (ca) of the Bankruptcy Ordinance (Cap. 6).
(Replaced 45 of 1991 s. 4)
(2A) Where-
(a) the amount of any wages due to an applicant exceeds the amount of any
payment made to him under section 16 in respect of those wages, nothing in
this section shall affect the rights or remedies of the applicant in
respect of the amount of the excess;
(b) the amount of any liability in respect of the payment to an applicant
of a severance payment exceeds the amount of any payment made to him under
section 16 in respect of the severance payment, the rights or remedies of
the applicant in respect of the amount of the excess shall be subject to
the rights and remedies of the applicant in respect of the severance
payment transferred to and vested in the Board pursuant to subsection (1).
(Added 45 of 1991 s. 4)
(3) In this section "wages" includes wages in lieu of notice. (Added 48 of
1987 s. 6) (Amended 38 of 1989 s. 6)
25. Recovery of payment made by mistake
Where-
(a) any payment is made to any person from the Fund under a mistake of law
or fact; or
(b) notwithstanding that no person has beer charged with or convicted of
an offence under section 26, any payment is made to any person, in respect
of an application that is false in any material particular,
such payment shall be recoverable by the Board from the recipient thereof
as a debt due to the Board.
PART VII MISCELLANEOUS
26. Offences
(1) Any person who-
(a) in providing information for the purposes of this Ordinance including
any inquiry thereunder, makes any statement which he knows to be false in
a material particular or recklessly makes a statement which is false in a
material particular; or
(b) for the purposes of this Ordinance including any inquiry thereunder
and with intent to deceive, produces, supplies or sends, or otherwise
makes use of, any document or record which is false in a material
particular,
commits an offence and is liable to a fine of $50,000 and to imprisonment
for 3 months.
(2) Any person who, without reasonable excuse, fails to comply with any
requirement imposed by the Commissioner under section 19 (1) or (4)
commits an offence and is liable to a fine of $ 5,000 and to imprisonment
for 1 month.
(3) Without prejudice to any Ordinance relating to the prosecution of
offences or to the powers of the Attorney General in respect of the
prosecution of criminal offences, a prosecution for any offence under this
Ordinance may be brought in the name of the Commissioner and commenced and
conducted by an officer of the Labour Department authorized in that behalf
in writing by the Commissioner.
(4) Where a complaint is made or an information laid for an offence under
this Ordinance by the Commissioner or any officer authorized under
subsection (3), the complainant or informant shall, for the purposes of
section 8 (1B) of the Magistrates Ordinance (Cap. 227), be deemed to be
acting on behalf of the Attorney General.
27. Regulations
The Governor in Council may be regulations-
(a) prescribe anything required or permitted to be prescribed under this
Ordinance;
(b) provide for the better carrying into effect of the provisions of this
Ordinance.
28. Power of Governor to amend Schedule
The Governor may by notice in the Gazette amend the Schedule.
29. Transitional
The Protection of Wages on Insolvency (Amendment) Ordinance 1987 (48 of
1987) ("the amending Ordinance") shall apply to and in relation to any
payment to be made in accordance with section 38 of the Bankruptcy
Ordinance (Cap. 6), or section 265 of the Companies Ordinance (Cap. 32),
after the Commencement of the amending Ordinance, notwithstanding that any
debt to which such payment relates was incurred before that commencement.
(Incorporated 48 of 1987 s. 9)
SCHEDULE [ss. 3 & 28] PROTECTION OF WAGES ON INSOLVENCY FUND BOARD
1. Status of Board
The Board shall not be the servant or agent of the Crown nor shall it
enjoy any status, immunity or privilege of the Crown.
2. Seal
(1) The Board shall have a common seal, the affixing of which shall be
authenticated by the signature of any 2 members.
(2) Any document purporting to be a document duly executed under the seal
of the Board shall be received in evidence and shall, unless the contrary
is proved, be deemed to be a document so executed.
3. Tenure of members
(1) A member of the Board who is not a public officer shall, unless his
appointment is terminated or otherwise ceases, hold office for such period
as the Governor may specify.
(2) On the expiry of his period of appointment or re-appointment, any
member to whom subparagraph (1) applies shall be eligible for
re-appointment for such further term as the Governor may specify.
(3) Any member to whom subparagraph (1) applies may at any time resign
from office by giving notice in writing to the Governor, and he shall
cease to be a member from the date specified in the notice or, if no date
is specified, from the date of the receipt by the Governor of the notice.
(4) If any member of the Board. other than the Chairman, is absent from
Hong Kong or is for any other reason unable to exercise the powers or
perform the duties of his office as member, the Governor may appoint
another person to be a temporary member in his place during his absence or
incapacity.
4. Chairman
(1) The Governor shall appoint a person to be Chairman of the Board and
shall give notice of such appointment by notice in the Gazette.
(2) If the Chairman is absent from Hong Kong or is for any other reason
unable to act as Chairman, the Governor may appoint another person to be
Chairman in his place during his absence or incapacity and shall give
notice of such appointment by notice in the Gazette.
(3) At any meeting of the Board the Chairman shall have a casting vote in
addition to a deliberative vote.
5. Meetings and proceedings of the Board
(1) Meetings of the Board shall be held at such times and places as the
Chairman or person acting as Chairman may appoint.
(2) The quorum for meetings of the Board shall be 5.
(3) Subject to this Schedule the Board may determine its own procedure.
6. Transaction of business by circulation of papers
The Board may transact any of its business by the circulation of papers,
and a resolution in writing which is approved by a majority of the members
shall be valid and effectual as if it had been passed at a meeting of the
Board by the votes of its members so approving the resolution.
7. Board may delegate to Commissioner
The Board may by resolution, with or without restrictions or conditions as
it thinks fit, delegate in writing to the Commissioner any of its powers
and duties other than its power under section 4 (1) (b) or 17 (3).
8. Committees
The Board may create and appoint such committees for any general or
special purposes as it thinks fit and, in relation to such committees, -
(a) the Chairman shall be appointed by the Board; and
(b) the Chairman and at least 2 out of every 3 persons appointed to a
committee shall be members of the Board.
9. Board may delegate to Committee
The Board may by resolution, with or without restrictions or conditions as
it thinks fit, delegate in writing to any committee appointed under
paragraph 8 any of its powers and duties other than its power under
section 4 (1) (b) or 17 (3).
Note: Section 4 of 15 of 1993 which amended the Protection of Wages on
Insolvency Ordinance is a transitional provision that affects this
Ordinance.
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