Bankrupt companies were yesterday accused of trying to use a government insolvency fund, which has dropped by $120 million this year, to escape paying outstanding wages to workers. The Hong Kong and Kowloon Trade Union Council made the claim after it was revealed the Labour Department-managed Protection of Wages on Insolvency Fund stood at $810 million compared with its peak last year of $930 million. Government officials predict it will drop to $763 million by the new year. Lee Kwok-keung, chairman of the 28,000-strong trade union council, said: 'Workers - particularly in the construction and retail industries - are complaining that employers are trying to use this fund as a way to escape paying wages.' He said the council had a number of official complaints in the past two months. Many workers did not want to claim their wages through the fund because they might not be able to get as high a payout as they were entitled to from their employers, Mr Lee said. Collapsed companies might still have the cash to pay their workers outstanding wages despite having debts, he said. A Labour Department spokesman said it could not comment directly on the union's claim but was confident the fund was healthy and could meet demand. Many workers who have applied for payouts are from the restaurant, construction and garment businesses, all hard hit by the recession. The spokesman said from January to September the department had 11,249 applications from workers, compared with 10,550 for the whole of last year.
