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Moral hazard, insolvency and employees as creditors: what governance lessons can be learned from the Hong Kong model?

journal contribution
posted on 2023-05-17, 08:58 authored by Ho, JKS, Price, R
This article argues that each of the US, the UK and Australia could take inspiration from Hong Kong's Protection of Wages on Insolvency Fund (POWIF) because it has the makings of a world-leading model for the protection of employee entitlements in circumstances of business failure. In particular, it is argued that although POWIF is open to fraud by unscrupulous employers it does not unduly increase moral hazard because its coverage provides only a modest safety net, it is funded by a mandatory private sector levy and it operates on a self-sustaining basis.

History

Publication title

The Journal of Corporate Law Studies

Volume

11

Pagination

525-550

ISSN

1473-5970

Department/School

Faculty of Law

Publisher

Hart Publishing Ltd.

Place of publication

United Kingdom

Rights statement

Copyright 2011 Hart Publishing

Repository Status

  • Restricted

Socio-economic Objectives

Justice and the law not elsewhere classified

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