Hong Kong

Corporate impunity continues:
Another lenient sentence for failing to provide insurance after worker dies

The employer of an electrical technician who died at work after receiving an electric shock was given a three-month suspended prison sentence for failing to buy insurance for the worker.

On 3 April, Ng Ka-wai the owner of Co-Agent Electrical Project Company was fined HKD $20,000 (US$2,557) and sentenced to a three months' prison sentence, suspended for three years, in Kowloon City Court for failing to take out an insurance policy for his employee as required by the Employees' Compensation Ordinance.

According to the Hong Kong Confederation of Trade Unions (HKCTU) it is common in Hong Kong for employers not to buy insurance for their workers and instead to ask workers to become self employed where possible. In the event of an accident, “They try to settle with workers on compensation when there are accidents and ask workers not to report any injuries to the Labour Department."

The use of minimal fines and suspended sentences for employers breaching the law in these cases has long been criticized by the HKCTU for its lack of deterrence to other employers. HKCTU spokesman reported: "The sentence in this case is just too lenient... Punishment of these employers should be toughened to scare off would-be offenders”.

However according to the Hong Kong SAR Government "This is the heaviest sentence ever imposed on an employer for breaching the requirements on work compensation insurance,” The Permanent Secretary for Economic Development and Labour Matthew Cheung Kin-chung went on to say that this was the second time in five months an employer had been given a suspended setnce for failing to get insurance.

In Hong Kong labour law, employers must buy a valid insurance policy for employees to cover liabilities under the Employees' Compensation Ordinance and under common law for work injuries.

According to statistics from the Labour Department the number of occupational injuries in all workplaces in 2004 was at 44 025, an increase of 4.8 per cent over 2003, while the injury rate per 1 000 employees increased slightly from 17.7 to 18.1, up by 2.6 per cent. The increase was largely attributed to the rebound of the local economy after the economic slump caused by the SARS crisis in 2003.Some 17,533 industrial accidents were recorded in 2004 giving a slight increase of 1.6% when comparing with the figure in 2003 but a significant drop of 21.9% when comparing with 2002. Fatal industrial accidents of all industries also decreased from 28 in 2003 to 24 in 2004, and for the construction industry alone, from 25 to 17 cases.

4 April 2006