Employment scheme penalties set

May 23, 2020

Secretary for Labour & Welfare Dr Law Chi-kwong today reminded employers of the penalties for applicants of the Employment Support Scheme if they did not provide two undertakings or commitments.


Speaking to reporters after attending a radio programme, Dr Law said the penalties were based on the principle of there being no redundancies.


He explained that the first part of the required commitment was for the employer not to implement any redundancies in June, July and August when they receive the Government wage subsidy in the first tranche.


The other commitment was that in any particular month, if the employer failed to pay all wage subsidies received for that month to its employees, the Government would claw back the unspent balance of the subsidies. 


“For the first tranche, for the sake of providing a clear understanding of the rules and calculations, we have made it very clear that if the money that we have given to the employers has not been totally spent on salaries, the difference (unspent balance of subsidy) will be clawed back.


“If the number of paid employees in June, July and August is less than the number of employees in March, there will be a penalty based on the percentage of reduction in staff numbers and also depending on the size of the company.”


Regarding the second tranche from September to November, Dr Law said the Government had not yet decided on its eligibility and rules.


“There is a high probability that, if people cannot comply with the commitments they have made during the (first tranche) of applications, they may not have the opportunity to apply for the second tranche.


“We will wait and see how it will happen, but the rules for the first tranche have been fixed and the applications will start next Monday.”

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