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Annex
Facts on the package agreed by the Protection of Wages on Insolvency Fund Board and the Labour Advisory Board on the coverage of arrears of wages and wages in lieu of notice under the Protection of Wages on Insolvency Ordinance (PWIO)
Nature of Fund
provides prompt relief in the form of ex-gratia payments
not a substitute for insolvent employers to effect full compensations to employees
Coverage of the Fund
maximum payments covered were reviewed periodically
the Fund Board, which comprises employers and employees representatives, has proposed to increase the maximum payment of:
End
(1)
Arrears of Wages (AW) from $18,000 to $32,000
[Median wage ($8,000) x 4 (4 months coverage period under the PWIO)]
(2)
Wages in lieu of notice (WILON) from $6,000 to $10,000 [Median wage ($8,000) plus safety margin for higher-paid applicants]
(3)
No change to Severance Payment (SP) [the level was increased in July 1995 from $8,000 plus 50% balance entitlement to $24,000 plus 50% balance entitlement]
Over 90% of applicants will have AW and WILON entitlement fully covered for next 2 years.