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Employers' failure to take out insurance for their employees


Date of Meeting: 30 May 2001

Asked by : Hon Andrew CHENG

Replied by : SEM

Question :

Under the Employees' Compensation Ordinance (Cap. 282), employers are required to take out insurance to ensure that in case employees are injured or die in the course of their employment, the insurance companies concerned will undertake the liability for compensation. In this connection, will the Government inform this Council of the respective numbers of employers warned and prosecuted by the Labour Department for failing to take out valid insurance for their employees, the number of convicted cases and the average penalties imposed by the courts in each of the past three years?


Madam President,

The numbers of warnings given and prosecution instituted by Labour Department in the past three years against employers' failure to take out employees' compensation insurance as required under the Employees' Compensation Ordinance are as follows -

  1998 1999 2000
No. of prosecutions 990 923 1042
No. of convictions 928 861 981
Total fine $2,662,605 $2,336,740 $2,642,670
Highest fine recorded in a single case $15,000 $10,000 $12,000
Average fine $2,869 $2,714 $2,694
Written warnings* 4 6 7

* The prosecution policy of the Labour Department is to prosecute all employers who fail to take out valid employees' compensation insurance as required under the law. Nevertheless, the Labour Department will consult Department of Justice in special circumstances, for example, when the employment relationship between the employee and the employer cannot be clearly established. If it is considered that there is insufficient evidence to support successful prosecution, the Labour Department will issue warning letters instead of instituting prosecution.

Last revision date: 30 May 2001
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