More than a third of the 900 DSC staff who lost their jobs without warning when the company collapsed this week have lodged claims with Labour Department already.
DSC, a chain of 14 furniture and appliances stores, closed its doors owing tens of millions of dollars with staff reportedly unpaid for a month or more.
A spokesman for the Labour Department on Wednesday said it had so far registered more than 300 claims from affected employees seeking recovery of outstanding wages and compensation for the sudden termination of their employment.
“The LD has registered details of the items of their claims. We will also continue to assist them proactively in settling the unpaid wages and other compensations under the Employment Ordinance, including lining up conciliation meetings and making arrangements on other related claims procedures,” he said.
The spokesman emphasised the department will continue to follow up on the incident closely. “The department will continue to work hard to seek to establish contact with the employer or his representative and the director(s) via different channels to find out details of the incident and to assist the employees in settling claims through civil litigation,” the spokesman said.
Since DSC closed, the LD has rendered assistance to the affected employees through the branch offices of the Labour Relations Division of the department, including briefing them on employment benefits and assisting them to register their claims. An enquiry hotline (Tel: 2927 7008) has been set up to handle enquiries of the affected employees regarding their employment benefits. Another dedicated hotline (Tel: 2342 0486) was also set up on the same day to answer enquiries on employment services.
“Employees who have not yet registered should contact the LD as soon as possible,” he said.
Special counters have been set up at the department’s 13 Job Centres across the territory to offer employment assistance to the affected employees of DSC.
On the related procedures, the spokesman explained: “If the employer and employee fail to reach consensus over the claims of the employee, the LD will refer the claimant to the Labour Tribunal under the Judiciary for adjudication. If the employer fails to pay the sum of claims awarded by the Labour Tribunal, or if the employer is proven unable to pay his debts, the LD will assist the claimant to apply for the ex gratia payment from the Protection of Wages on Insolvency Fund (PWIF).”
As regards the procedures on the application for the ex gratia payment from PWIF, the spokesman further elaborated that, “The presentation of a winding-up or bankruptcy petition is a prerequisite for ex gratia payment from PWIF. If necessary, the LD will assist to refer employees of DSC to the Legal Aid Department in presenting petition against their insolvent employer.”
At present, the maximum amount of ex gratia payment that an employee can receive from PWIF is $289,000. The amount includes $36,000 in respect of wages for four months, $22,500 in respect of wages in lieu of one month’s notice, severance payment up to $50,000 plus 50 per cent of the remainder of the entitlement, and a payment ceiling of $10,500 in respect of the annual leave pay for the annual leave accumulated and not yet taken by the employee in the last two leave years and/or the payment for untaken statutory holidays in the last four months.
The LD pledges to arrange for granting of the ex gratia payment from PWIF to the applicants within 10 weeks upon receipt of all the information and documents required (including the awards of the Labour Tribunal). The LD will expedite the processing of the applications of DSC’s employees. The time required for processing and verifying each application will depend on whether sufficient information and evidence has been provided. The LD will grant payment as soon as possible and practicable.
The spokesman reiterated that the LD attaches great importance to combating wage offences and is very concerned about non-payment of wages.
“If there is sufficient evidence to indicate that the company concerned has defied the law wilfully, the department will commence investigation promptly and consider initiating prosecution action against the company and its director(s) or other responsible person(s),” he said.
Under the Employment Ordinance, an employer commits an offence if he wilfully and without reasonable excuse fails to pay wages within seven days from last day of the wage period or upon termination of employment, and is liable to a maximum penalty of $350,000 and three years’ imprisonment.
“The LD urges employees of DSC to come forward as prosecution witnesses against their employer if the employer is found to defy the law wilfully and commit wage offences, so that we can follow it up and commence investigation promptly. We are also keeping close contact with other law enforcement departments concerned to follow up on the incident,” the spokesman said.