The long-standing restaurant chain Ocean Empire Food Shop has closed all outlets after 33 years in business, leaving around 80 employees owed more than HK$8 million in wages and compensation. The company’s management has reportedly told staff to seek payments from the government’s Protection of Wages on Insolvency Fund (PWIF).
The closure adds to a growing wave of business failures as Hong Kong’s economy struggles to recover. Official figures show the catering industry has topped PWIF claims for three consecutive years. In 2023, the fund paid out HK$45.5 million to restaurant workers — a 30% jump from the year before, and more than double the amount disbursed in 2022.
The surge in claims is putting serious strain on the fund’s finances. As of February, the PWIF recorded a deficit of HK$24.1 million in the last financial year. The government now forecasts that the shortfall will grow more than threefold to HK$113.1 million in 2025–26, citing the deteriorating economic outlook.
The PWIF, widely regarded as a barometer of Hong Kong’s labour market, provides default wages, severance payments, and other compensation to workers left unpaid by insolvent employers. In recent years, a surge in claims has pushed both the number of applications and total payouts to record highs.
Catering and construction remain the hardest-hit sectors. Ex gratia payments to restaurant workers surged from HK$14.8 million in 2022 to HK$45.5 million last year. Construction workers received HK$43.6 million in 2024, up from HK$15.1 million two years earlier — a rise of nearly 190%. The year-on-year increase alone was 91%.
The situation has been compounded by the government’s relaxation of restrictions on imported labour. Critics say the move has further squeezed opportunities for local workers already facing layoffs due to business closures.
As of March 2023, the fund still held a healthy surplus of HK$7.3 billion. But that buffer is now shrinking. And while the PWIF sets compensation caps on claims, affected workers are often unable to recover their full wages or severance pay. With more closures expected in the months ahead,many more workers could soon be left out in the cold.