Ceiling for severance pay could be as high as HK$200k

The government has proposed that employees who lose their jobs after their companies go bankrupt can get as much as HK$200,000 of severance pay - double the current ceiling. They will also get half of any more money owed to them. The ex-gratia payments, that are made by the government's Protection of Wages on Insolvency Fund (PWIF), also cover unpaid wages, pay for untaken annual leave and statutory holidays, as well as payment in lieu of notice. In a paper submitted to the Legislative Council, the Labour and Welfare Bureau said it expects the move to allow 86 percent of the applicants to obtain their severance payment in full. “With an average of some 3,000 applications received annually and an accumulated surplus of over HK$7.2 billion as at December 2023, PWIF was financially sound enough to cope with the possible increase in applications,” it reads. Speaking on a RTHK radio programme on Thursday, Lam Chun-sing, chairman of the Legislative Council's manpower panel said he welcomed the proposal. "If no-one abuses the fund, I think the number of applications will remain similar at around 3,000 cases each year," he said. "Even when the economy is poor, I think there will be only 4,000 to 5,000 cases. To a fund that has more than HK$7 billion, it's financially sound in the long run." Members of the Legco panel on manpower are set to discuss the matter on Monday.

Ceiling for severance pay could be as high as HK$200k

Ceiling for severance pay could be as high as HK$200k

Ceiling for severance pay could be as high as HK$200k

Ceiling for severance pay could be as high as HK$200k

Ceiling for severance pay could be as high as HK$200k