[Tips for Boss] Learn about the potential claims against employer | Article – HSBC VisionGo
Employees can make claim against the employer with different reasons, even injury due to changing the water bottle. Do you know the risk well?
Employer is liable to pay compensation under the Employees’ Compensation Ordinance for the employee who is injured or died at work, irrespective of the duration of employment contract or working hours, full-time or part-time permanent or temporary staff.
As an employer, it is vital for you to know that Employees’ Compensation insurance policy is one of the statutory requirements under the Ordinance. The employer who fails to comply with the Ordinance to secure the respective cover is liable to prosecution and, upon conviction, to a maximum fine of HKD100,000 and imprisonment for 2 years!
As a start-up or SME, you must have load of works on your plate every single day. Arranging Employees’ Compensation insurance either slips to the bottom of your to-do list or has not yet been shown on your list. However, you may not be aware of the potential risks borne by the employer if you miss to insure your employees under an Employees’ Compensation Insurance policy. You may wonder if risks exist for employees who normally work in the office environment which is traditionally viewed as non-hazardous.
However, accidents do occur in office. Do you aware of the respective compensation you may be liable under the Employees' Compensation Ordinance if this does happen? Have you ever thought of changing water bottle in the office pantry can sprain your employee’s waist or the falling heavy object may hurt their back as well? These compensations under the Ordinance may become your extra burdens if you miss to arrange the Employees’ Compensation insurance policy.
Does employer liable to pay compensation for employee’s injury due to changing water bottle?
You, as the employer, may ask under what circumstances your employees are entitled to claim compensation against their employer? If an employee sustains an injury or dies as a result of an accident arising out of and in the course of his employment, his employer is in general liable to pay compensation under the Employees’ Compensation Ordinance even if the employee might have committed acts of faults or negligence when the accident occurred.
Generally speaking, when an employee is working in office during office hours at the time of accident, the compensation burden would normally rest on his employer. You can imagine some of the common injuries in office, like spraining back whilst changing the water bottle on the water cooler in office pantry or hurting the back due to heavy falling objects, would pose potential risk to the employees.
Any liability if an employee injures while joining a company arranged meal?
Generally, the employer would not be liable for the accident occurred outside the office, e.g. having lunch in restaurants and travelling to or from work. Yet, such would be the case subject to following circumstances. The employer would be liable for the employee’s injury during his participation of a business meal at the request of the employer or his customer. The employer would also be liable for the employee’s injury in his way to or from work if the transportation taken is offered or arranged by the employer, like shuttle bus. As well as his way to customer by taking any public transportations under the employer’s permission.
In addition, as long as the Red, Black Rainstorm, typhoon signal number 8 or above is issued, the employer would be liable for the accidental injury or death of the employee when he is travelling directly to or from work within 4 hours before or after the working hours under the Employees’ Compensation Ordinance.
Compensation in cases of work injury
In general, if an employee has a work injury, the employer is liable to pay the periodical payments at the rate of four-fifths of the difference between the employees’ monthly earnings at the time of accident and his monthly earnings during the period of his temporary incapacity. For permanent partial or total incapacity results from a work injury, the employer is also liable for the compensation based on the calculation method under the Employees’ Compensation Ordinance.
Other than the above, the employer is able liable for medical expenses, the costs of supplying, fitting and repairing the prostheses or surgical appliances if they are incurred by the injured employee. For fatal cases, the minimum amount of compensation is HKD440,200, while funeral and medical attendance expenses can also be reimbursed from the employer. You may not aware that there is around 200 employees died due to their employment in Hong Kong annually.
Mis-stating or under-reporting material information may invalidate your insurance contract
Other than taking out an Employees’ Compensation insurance policy, it is important for you to provide accurate information including business nature, insured employees’ occupations, number and actual earnings of your employees and ensure all employees are covered. Any discrepancy between the declared information and the actual situation may lead to repudiation of claims or reduction in the compensation to the employer and therefore the employer will have to pay any compensation out from his own pocket.
In the recent, Insurance Authority requires employers to provide relevant documents (e.g. Mandatory Provident Fund contribution statements) to facilitate the risk assessment and determination of premium by the insurance company and to ensure having proper insurance protection to meeting Employer’s potential liability. If there are any updates during the period of insurance, you are required to inform your insurer the same to ensure the continuity of the insurance cover.
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The above content is reviewed by Jamie Chambers - Head of Commercial, Property & Casualty - of AXA Hong Kong and Macau
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