The Employees Compensation Assistance Scheme
Employees injured at work or eligible family members of deceased employees (the “applicants”) may apply through the Scheme for assistance payments from the Fund, which serves as the safety net of last resort to provide for the protection of the entitlements of the applicants to employees’ compensation and/or common law damages. In other words, the Fund, through its assistance mechanism, would only offer assistance payments to those who have established liability and quantum of their claims but are unable to receive their entitlements from employers (or insurers) after exhausting all legal and financially viable means of recovery. Under the terms of the Scheme, the Board may take any legal action it considers necessary against the employer (or insurer) to recover the payments effected from the Fund upon offering assistance to the applicants.
Injured employees or eligible family members of deceased employees who fail to receive employees’ compensation and/or common law damages for which the employer is liable after exhausting all legal and financially viable means of recovery from the employer (or insurer) concerned are eligible for assistance payments from the Fund.
Types of Assistance Payments from the Fund
The following types of assistance payments are payable from the Fund:
- Unpaid employees’ compensation for work-related injuries or fatalities covered by the Employees’ Compensation Ordinance (Cap. 282) (“the ECO”) and the related interests;
- Costs incurred in legal proceedings in claiming employees’ compensation; and
- Unpaid common law damages awarded in respect of such injuries or fatalities, payable in the form of relief payments (Note).
- According to the ECAO, an injured employee or eligible family member who is awarded by the court an amount of common law damages and is successful in his application for assistance from the Fund would be granted a “relief payment” in lieu. The relief payment shall not exceed the aggregate sum of damages awarded by the court and shall not cover any interest on such damages and costs arising from proceedings in respect of damages. Where the amount of relief payment does not exceed the prescribed relief payment of $6 million, it will be paid in full in a lump sum. If it exceeds the prescribed relief payment, an initial payment of $6 million shall be paid and then followed by monthly payments calculated at the rate of the monthly earnings of the employee at the time of the accident or the prescribed monthly amount of $40,000, whichever is the higher (in the case of an employee who is suffering from paraplegia or quadriplegia and has been determined as a “severely-injured relevant eligible person” under the ECAO, an additional monthly payment of $40,000 as prescribed monthly amount (extra)), until the total amount of damages awarded by the court is paid off.
Notification of Proceedings
Under Section 25B of the ECAO, any person who commences legal proceedings for claiming compensation or damages should serve on the Board a written notice of such proceedings in a specified form not later than 30 days after the claim is filed with the court. This protects the rights of the Board to intervene in the legal proceedings timely if it considers appropriate to do so.
Upon receiving the notice of proceedings, the Board will conduct such inquiries as it considers necessary. The Board may require the parties concerned or any person connected with the claim to provide the following information or documents:
- evidence of the occurrence of the work accident;
- evidence of the injured or deceased person’s employment status and earnings at the time of the accident;
- a copy of the relevant employees’ compensation insurance policy;
- a Certificate of Compensation Assessment / Certificate of Review of Compensation Assessment, or a Certificate of Compensation Assessment for Fatal Case / Review Certificate of Compensation Assessment for Fatal Case issued under Section 16A and Section 6 of the ECO respectively;
- a Certificate of Medical Expenses issued under Section 10B of the ECO;
- a Certificate for Funeral and Medical Attendance Expenses / Review Certificate for Funeral and Medical Attendance Expenses issued under Section 6 of the ECO;
- Judgements or Orders issued by courts of Hong Kong;
- certificates of costs assessment; and
- other documents that will assist the Board in its investigations.
Joining in Litigation and Mediation as well as Negotiation for Settlement
To safeguard the interests of the Fund, the Board may intervene in the legal proceedings by applying to the court to be joined as a party to the litigation. Where appropriate, the Board may also actively participate in mediation or negotiate for a settlement with the claimant. This practice enables the claimant to receive compensation and/or damages earlier and saves the costs of legal proceedings of all parties concerned.
Claims against the Board
Injured employees (or eligible family members of deceased employees) who are unable to claim against their employer for employees’ compensation in the following circumstances are entitled to file with the court claims against the Board as if the Board were the employer in question:
- the employer cannot be identified or located; or
- the employer is insolvent; or
- the employer is dead or in the case of a company, has been dissolved, wound up or struck off the Company Register; or
- the employer cannot be served with a summons; and
- the employer fails to take out a valid employees’ compensation insurance policy.
Application for Assistance from the Fund
Injured employees (or eligible family members of deceased employees) who have failed to receive employees’ compensation and/or damages to which they are entitled to after exhausting all legal and financially viable means of recovery from the employer (or insurer) concerned (including commencing bankruptcy or winding-up proceedings against the employer (or insurer)) may apply for assistance from the Fund. Applications should be made in the form specified by the Board.
Applicants who have received assistance payments from the Board for employees’ compensation or relief payments are not entitled to make further claims against their employer (or insurer). Their rights and remedies in respect of such compensation, damages, interest and/or costs are transferred to and vested in the Board for the benefit of the Fund. The Board may take such legal actions as it sees fit to recover the payments from the employer (or insurer) in question.