Provisional Supervision and Workers' Wages: An Alternative Proposal
Philip Smart
University of Hong Kong - Faculty of Law
Charles D. Booth
Institute of Asian-Pacific Business Law, William S. Richardson School of Law, University of Hawaii at Manoa; University of Hawaii at Manoa - William S. Richardson School of Law
Hong Kong Law Journal, Vol. 31, No. 2, p. 188, 2001
Abstract:
In May 2001, the Companies (Corporate Rescue) Bill was gazetted. The Bill makes provision for a statutory corporate rescue mechanism, to be known as provisional supervision. The most controversial aspect of the Bill is the treatment of workers' wages. The Bill essentially requires that before a company may even enter into provisional supervision, it must have paid off in full all debts (and other entitlements) owing to its workers. The Bill does not, however, explain how a financially distressed company is supposed to find the cash to meet the statutory requirement. This requirement may also be criticised because it is at odds with the treatment of workers' wages in other insolvent procedures, thus leading to unfairness. This article proposes an alternative approach, one which, it is suggested, is in the interests of both financially troubled companies and their workers.
Accepted Paper Series
Date posted: August 28, 2006
; Last revised: February 12, 2010
Suggested CitationSmart, Philip and Booth, Charles D., Provisional Supervision and Workers' Wages: An Alternative Proposal. Hong Kong Law Journal, Vol. 31, No. 2, p. 188, 2001. Available at SSRN: http://ssrn.com/abstract=926659
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