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Points to Note for "Employees"
and "Self-employed Persons" 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 (ECO). According to the ECO, an injured
employee of a sub-contractor can make a claim against the principal contractor
for employees' compensation if his employer has failed to pay him his entitled
compensation. In such circumstances, the injured employee may issue a written
request to his employer for the supply of the name and address of the principal
contractor in order that he could make a claim against the principal contractor. In
employees' compensation cases, notwithstanding the production of a contract by
the "employer" indicating the worker is a self-employed sub-contractor,
the court could still make adjudication on whether there exists an "employer-employee"
relationship between the parties concerned, based on the facts of the case. Should
an "employer-employee" relationship be established between the two parties,
the employer is liable to pay compensation to the injured employee in accordance
with the ECO. A Court case
for reference:
In a civil case adjudicated by the Court of Appeal
of the High Court of the HKSAR (CACV 273/98), the family members of a scaffold
worker who died as a result of falling from height were awarded compensation under
the ECO. In the case, the employer alleged that the work was sub-contracted to
the scaffold worker who was an independent self-employed person. On a detailed
analysis of the relevant evidence and facts of the case, the Court eventually
ruled that the scaffold worker was an employee, and not an independent sub-contractor,
and the employer was obliged to pay the employees' compensation. The following
are factors considered by the Court for verifying whether there exists an employer-employee
relationship in the case: 1.
Any agreement on lump-sum remuneration for completion of the work and any confinement
on the work scope
It is to be noted that even in case of an "employer-employee"
relationship, the parties involved might sometimes agree on piece-rate for computing
the employee's wages.
2. Degree
of control over the work
Generally, the more the control the employer
has over the procedures, the pace and the manner adopted for the production, the
more the likelihood that both parties are bound by an "employer-employee"
relationship.
3. Provision of
work equipment
Generally, an employee is provided with equipment
and tools by his employer. However, it is not uncommon in some trades that the
employees would carry with them their frequently-used tools when attending work.
4. Recruitment and dismissal of other
helping hands
If the employer also hires some other employees to
assist a worker in completing his work, there is a higher likelihood that the
worker in question is just another employee of the employer.
5.
Bearing of financial risks
In general, employees do not have to
bear any financial risks, even if he is a piece-rated worker.
6.
Responsibility for investment and management
Generally, an ordinary
employee does not have to input capital for investment or assume a management
role.
7. Profit making through
effective work management
Generally, an employee does not have
such an opportunity.
8. Other
relevant factors
Such as the intention of both parties. Self-employed
person should consider taking out personal accident insurance
The
Employees' Compensation Ordinance does not cover self-employed persons. A self-employed
person should carefully assess the possible risk at work and take out a personal
accident insurance policy of appropriate amount for safeguarding the interest
of himself and his family members. It is to be noted that persons taking out personal
accident insurance policy may not necessarily be self-employed as employees could
also take out personal accident insurance policy for securing a better insurance
protection. Notes for employees
An employee should ascertain that his employer has taken out an employees' compensation
insurance policy. An insured employer (with the exception of employers of domestic
helpers) is required to display, at a conspicuous place of the work place, a notice
of a valid employees' compensation insurance policy. An employee should notify
the Labour Department immediately if he discovers that his employer has not taken
out an employees' compensation insurance policy for him (Tel:2815 2200). Enquiry
Phone number: 2717 1771
(The hotline is handled by the "1823 Call Centre")
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