The owner, Ocean Empire International, informed all its employees late on Wednesday in a letter that it had shut down all outlets and offices and terminated their contracts of all employees the same day.
Speaking on an RTHK radio programme, Lam Chun-sing pointed out the closure showed that the catering sector is facing a lot of challenges.
He said the owner could have made the announcement earlier.
“Indeed it seems rather irresponsible as the company issued the notice in this manner,” Lam said.
“It’s not as if it only found out it had to close at the last minute; it likely knew about it three or four months in advance.
“It should have informed the employees earlier about when the final payday would be, whether any unused annual leave would be fully compensated and then proceeded with the closure.
“Then it would have given colleagues time to prepare and start looking for other jobs earlier.”
In the letter, the management wrote that employees could turn to the Labour Department for assistance about Protection of Wages on Insolvency Fund for ex-gratia payments.
Workers can apply to the fund if a company is unable to pay back its employees after liquidation.
Lam expressed concern over whether employees would be able to get back the full amount of their wage arrears even if they applied to the fund as it has a ceiling of HK$80,000.
The Labour Department said at least 80 staff members have sought help over such issues as outstanding wages, which amount to more than HK$8 million.
The Eating Establishment Employees General Union has received more than 100 requests for assistance, including about 20 imported workers. They were owed up to HK$10 million in total.
Lam noted that some imported workers have to pay tens of thousands of dollars to work in the SAR, and they have to return home within 14 days after the termination of their employment.
He called on the government to work with mainland authorities on the issue of agency fees as those who have been terminated within a short period upon arrival will undoubtedly suffer huge losses.
The general union’s Chiu Kwun-chung said on the same show that the restaurant has neither paid wages since last month nor contributed to staff’s mandatory provident funds since January even though it had deducted the amounts from their incomes.
He said the company should offer details on the matter, instead of breaking the news in the form of a letter, which he considered as anything but ideal.
Chiu added that the owner should offer up information, such as staff’s work attendance as well as leave records, to enable them to apply for ex-gratia payments.
