CHAN CHOI YIN JANICE v. TOPPAN FORMS (HONG KONG) LTD

DCEO 6/2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EQUAL OPPORTUNITIES ACTION NO. 6 OF 2002

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JUDGMENT

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1.  The Defendant is a company incorporated in Hong Kong supplying printing services and printing materials and stationery to corporate clients.

2.  The Plaintiff was an employee of the Defendant (“Toppan”) between 2 June 1997 and 25 October 2000.  She was employed as an Account Manger in the Defendant's Data Management Services Sales Department (DMS) and assigned to work in team R at a basic monthly salary of HK$11,000. She was further paid a monthly travelling allowance of $300 and share in the sales commission and shipment bonus based on the performance of team R. On 1 January 1998, her basic monthly salary was increased to $11,350. 

3.  In this action, the Plaintiff claims she was unlawfully discriminated and victimised due to her pregnancy.  She seeks damages under Section 76(3A)(b) & (f) of the Sex Discrimination Ordinance (SDO) for injury to feelings and loss of income and punitive or exemplary damages. She also asks for a written apology from the Defendant for the discriminatory acts against her and the injury to her feelings caused.  She further seeks a truthful reference letter of her satisfactory performance while working at the Defendant's company.

4.  The Plaintiff claims that the Defendant committed the following unlawful acts causing her to suffer loss and damage.

(a) Unlawful pregnancy discrimination under Section 8A and Section 11(2)(c) of the Sex Discrimination Ordinance and/or

(b) Unlawful discrimination by way of victimization under Section 9(1)(c) and (d) and Section 11(2)(c) of the SDO.

The Relevant Provisions of the Legislation

5.  The relevant provisions of the SDO are as follows:

“8.     Discrimination against pregnant women in employment field

A person discriminates against a woman in any circumstances relevant for the purpose of any provision of Part III or IV if –

(a)   on the ground of her pregnancy he treats her less favourably than he treats or would treat a person who is not pregnant;

(b)   he applied to her a requirement or condition which he applied or would apply to a person who is not pregnant but-

(i)  which is such that the proportion of persons who are pregnant who can comply with it is considerably smaller than the proportion of persons who are not pregnant who can comply with it;

(ii)  which he cannot show to be justifiable irrespective of whether or not the person to whom it is applied is pregnant; and

(iii)  which is to her detriment because she cannot comply with it.

9.  Discrimination by way of victimisation

(1)  A person (“the discriminator”) discriminates against another person (“the person victimised”) in any circumstances relevant for the purposes of any provision of this Ordinance if he treats the person victimised less favourably than in those circumstances he treats or would treat other persons, and does so by reason that the person victimised or any other person (“the third person”) has – 

(a)  brought proceedings against the discriminator or other person under this Ordinance;

(b)  given evidence or information in connection with proceedings brought by any person against the discriminator or any other person under this Ordinance;

(c)  otherwise done anything under or by reference to this Ordinance in relation to the discriminator or any other person; or

(d)  alleged that the discriminator or any other person has committed an act which (whether or not the allegation so states) would amount to a contravention of this Ordinance,or by reason that the discriminator knows the person victimised or the third person, as the case may be, intends to do any of those things, or suspects the person victimised or the third person, as the case may be, has done, or intends to do, any of them.

(2)  Subsection (1) shall not apply to treatment of a person by reason of any allegation made by him

if the allegation was false and not made in good faith.

11.     Discrimination against applicants and employees

(2)  It is unlawful for a person, in the case of a woman employed by him at an establishment in Hong Kong, to discriminate against her – 

(a)  in the way he affords her access to opportunities for promotion, transfer or training, or to any other benefits, facilities or services, or by refusing or deliberately omitting to afford her access to them;

(b)  in the terms of employment he affords her; or

(c)  by dismissing her, or subjecting her to any other detriment.”

6.  In order to prove pregnancy discrimination, the Plaintiff has to show she was treated less favourably by being dismissed because of her pregnancy when compared to an employee who is not pregnant.  For discrimination by way of victimization, the Plaintiff has to show that she was treated less favourably and was dismissed by reason that the Plaintiff alleged that the Defendant had committed an unlawful act which would contravene the SDO.  The law and the appropriate test to be applied under the law will be dealt with below.

The Plaintiff's Case

7.  The Plaintiff, Ms. Janice Chan, was employed on 2 June 1997 as an Account Manager at team R of the Defendant's Data Management Services Sales Department (‘DMS').  Her monthly salary during probation was $10,000. She was entitled to a guarantee monthly commission of $4,000 or sales commission/bonus whichever was higher.  She passed her probation after 4 months on 2 October 1997.  Her monthly salary was increased to $11,000 with a travelling allowance of $300.  Instead of a guarantee commission/bonus, she became eligible for a share of the sale commission and shipment bonus, her share percentage was subject to the agreement between Toppan and the staff.  She claimed that this bonus was a major part of her income and was directly linked to the monthly sales and shipment volume i.e. value of goods delivered to clients of the whole team.   Each team was assigned a list of clients to serve, a monthly sales and shipment budget and actual sales would be prepared by the team and the team's commission and bonus would be based on the actual sales and shipment by Toppan attributed to each team.  

8.  While at team R, Ms. Chan worked under the supervision of the senior Account Manager Mr Alan Mok who worked under Mr Caric Lee, the Sales Manager of DMS.  DMS was headed by the General Manager, Mr Johnson Chiu (‘Mr Chiu').  

9.  It is Ms Chan's case that Toppan had assigned to team R a number of important corporate clients with whom it had a well-established business relationship with high annual business turnover such as Aeon Credit Services (Asia) Co. Ltd., Citibank, Kumon Hong Kong Co. Ltd. (“Kumon”), and Crocodile Garments Ltd. (“Crocodile”).  Ms Chan was recruited by the Defendant to look after the accounts of these valued customers and to follow up their orders.  It was part of her duties to liaise with these clients and with Toppan's own production department to facilitate and process clients' orders.

10.  Ms Chan claimed that at team R she supervised and was assisted by account executives in the handling of small accounts and minor office routine.  Ms Chan insisted that the account executives were responsible for making cold calls and visits to explore new business opportunities with potential clients and such were not the duties of the Account Managers.

11.  Ms. Chan claimed that her performance as an account manager at team R was good. At the end of 1997, she was selected as a member of Toppan's Achievement Club that gave her an opportunity to visit Japan and Toppan's parent company in April 1998. She was selected to be the master of ceremony at a function to celebrate Toppan's 25^th anniversary in Hong Kong in 1998.

12.  Ms. Chan claimed that after she became pregnant, Toppan's management staff began an orchestrated course of conduct making the work environment difficult and unfavourable for her, that the unfavourable treatment constituted unlawful discrimination and/or victimization on the ground of her pregnancy.  Such course of conduct is revealed by the following facts.

First Pregnancy

13.  In May 1998, she became pregnant and informed Mr Caric Lee (“Mr Lee”) in mid-May of the pregnancy.   Mr Lee began to pick on her for meeting clients before coming to the office in the morning. She claimed that this was a common practice in the DMS and that she had never been criticised for it before she told Mr Lee of her pregnancy.  She also claimed at that time, other employees of DMS were not picked on in the same way.

14.  Ms Chan had a difficult pregnancy, she was admitted into hospital for pregnancy complications between 12 and 18 May 1998.  At the end of May, she had a miscarriage and underwent an operation in the hospital for which she was put on sick leave from 25 May to 6 June 1998.

15.  Upon her return to work, Mr Johnson Chiu made a remark to her to the effect that “since childbearing was so difficult, she should spend her time on working hard instead of wasting time on it”.  She was hurt and upset by the remark. 

Second Pregnancy

16.  At the end of November 1998, she became pregnant again. She duly notified Mr Caric Lee of her pregnancy in the latter part of November 1998 and took her annual leave between 30 November and 2 December 1998 on the advice of the Chinese herbalist.    She informed Lee in late December that it was not suitable for her due to her pregnancy to participate in physically demanding work at a trade fair Toppan would be taking part in early January 1999.  Consequently, certain unfavourable remarks appeared in her appraisal report in late December 1998, she attributed her two pregnancies as the reason for the unfavourable remarks in appraisal.

Transfer to Team U

17.  At the end of December 1998 and beginning of 1999, she was told by the DMS Senor Account Manager of team Q, Mr Terrence Man (“Mr Man”) that she would be transferred to team Q.  In January, however, he was told she would be joining a newly formed team, team U, also headed by Mr Man.  She was reluctant to accept the transfer and waited for the official written notification which never came.

18.  She complained that no official notice or documents explaining the reasons for the transfer were sent to her nor did she receive any official notice or document explaining the reason why a new team was formed consisting only of herself and Terrence Man who remained, at the same time, the head of team Q.   She was told the creation of this new team was Mr Johnson Chiu's idea.  As she was not explained the impact the transfer would have on her job or income, she was concerned particularly when it came at a time she had become pregnant.

Reduction of Income

19.  Ms Chan was initially told by Mr Man that her share of commission and bonus at the new team would be 80% and he would get the remaining 20%.  However, she was not given any written confirmation of her sales commission share percentage after the transfer in January 1999, neither was she given access to the sales commission records of team U that were hitherto available to her at team R.  It came as a surprise to her when Mr Man informed her in March 1999 her commission share percentage at team U was 60% only.  She also complained that she was assigned at team U the inactive clients, and clients that were known to be low income generating in 1999 from team R.  Clients who were good income generators previously handled by her such as Aeon Credit Card and Citibank were removed from her account and remained in team R.

20.  Ms Chan further complained that she was not given the usual 4 months guarantee commission/bonus when she was transferred to team U in the first 4 months of 1999. 

Direction to Work During Sick Leave

21.  Ms Chan was put on sick leave by her gynaecologist to ensure she would rest in bed to avoid a miscarriage from 18 to 30 January and for much of February of 1999.  She submitted the doctor's medical certificate in support of her sick leave on vaginal bleeding and threatened abortion ground.   She claimed she was told to return to the office to attend to a client on 23 January 1999.  On 26 January 1999, while still on sick leave she was told to accompany the customer and Mr Man to visit Toppan's factory in Yuen Long and Tsuen Wan.  At the visit, she felt unwell and asked to be excused but was told to stay until later on when she found her bleeding had persisted and had to leave to seek medical attention.

22.  Ms Chan claimed Mr Man instructed her to liaise with Toppan's inactive client Top Glory Insurance (Bermuda) Ltd. while she was on sick leave in February 1999.  She did so with favourable results but was prevented from following up with the client upon her return from sick leave. She was told the client had been wrongly assigned to team R.  She considered the action was deliberate to deprive her the fruits of her labour and to demoralize her.

23.  Ms Chan considered that Toppan through Mr Man had deliberately put pressure on her to create a difficult working environment to force her to leave her employment.

Disparaging and Derogatory Remarks from the Management Staff

24.  On 22 February 1999, Ms Chan claimed that Mr Man directed her to unpack her belongings that had been taken to a desk at team U when she returned to work from sick leave.   He humiliated her by telling her in front of colleagues that she should get her husband to unpack for her when she told him she could not do so due to her pregnancy. 

25.  Since her return from sick leave in March 1999, she felt members of the senior management had discriminated and isolated her because of her pregnancy.  She claimed that Mr Man and Ms. Pepeanna Lau (‘Ms Lau'), the new sales manager, were in the habit of picking on her and scolded her at morning meetings in front of other colleagues.  Ms Lau had on a number of occasions made derogatory remarks about her troubled pregnancy and sick leave and suggested to her she should pack up and go home.   While Mr Man had also made other sarcastic remarks about her pregnant condition.

Difficult Working Conditions

26.  She claimed that she was not given any assistance at team U for no account executives had been assigned at team U and she had to preformed the duties previously done by account executives at team R, such as visits and travelling and cold calls etc.  At the same time, promotion awards such as dining vouchers to clients placing orders over $50,000 were not extended to cold call clients recruited by her.  Furthermore, she was not given any support from senior management when a cold call client recruited by her, Carltex, requested to meet with senior management to discuss business development, both Mr Man and Ms. Lau failed to meet the client.

27.  Ms Chan complained that in July 1999, she was made to travel to Kwun Tong when she was heavily pregnant to pick up a film that she had already inspected and approved and to deliver it to the printer in Tsuen Wan.  On another occasion in July, while she was on sick leave, she requested Mr Man to follow up the details of an order handled by her, he failed to follow up the details and had changed the printing firm without telling her upon her return from sick leave.  She was then told to wait at the office for his call to tell her of the designation of the new printing firm.  She was then instructed to visit the printing factory at 11pm at night to supervise the printing process.  It was a simple job that did not require an on–site inspection.

Cancellation of Black-Storm Warning Leave Approval

28.  On the mornings of 23 and 24 August 1999, black-storm warnings were hoisted, Ms Chan claimed that the staff's annual leave would not be deducted if prior approval had been obtained from his/her supervisor when the black-storm signal was hoisted.   She duly obtained approval from Mr Man on the mornings of 23 and 24 of August to be excused from coming back to the office in the morning, and annual leave was granted to her for the afternoon of 23 August.  Six months later, she discovered that Terrence Man had subsequently filed a leave application on her behalf without her knowledge or consent for the mornings of 23 and 24 August 1999, contrary to the approval he had given to her at the time.

29.  She believed the unfair manner she was treated was because Mr Man had wanted to pick on her and made life difficult for her during the last stages of her pregnancy so that she would leave her employment voluntarily. 

Post-Maternity Leave UnfavourableTreatment

30.  Upon her return from maternity leave and annual leave on 22 November 1999, she found a memo from Ms Lau to her issued on 10 November 1999 referring to a formal complaint by a client and accused her of unprofessional and unacceptable performance. Ms Chan found the accusations unjustified.  She relied on a letter of 28 December 1999 from the said client Kumon International solicited by Ms Lau that supported Ms Chan's claim that the client was satisfied with her performance attributing the poor quality of the production referred by Ms Lau to the printing team.

31.  Mrs Chan denied the allegations of poor productivity and record maintenance in another of Ms Lau's memo of the same date.  In a third memo dated 29 November 1999, Ms Lau informed Ms Chan that Kumon had been removed from her clients list. Ms Lau further imposed strict work procedures and requirements based on Ms Chan's allegedly poor performance and informed her she would be trained as a junior sales staff. 

Accusation of Inflated Sales

32.  On 1 December 1999, Ms Lau accused Ms Chan of making up non-existent orders from clients and duplicating documents to give an impression of high sales volume. Ms Lau suggested to Ms Chan that she should resign.  Ms Chan felt she was wrongly accused, defamed and treated unfairly because of her pregnancy, she told the Toppan Human Resources manager and Mr Chiu that she would be making a report to the Equal Opportunities Commission (‘EOC').   Mr Chiu promised her he would look into the complaints of duplication of client's orders and the accusation of falsified sale order and her alleged unfair treatment, but full investigation of her complaints never took place.

Transfer to the China Business Sales Division

33.  Ms Chan claimed she was transferred against her will to the China Business Sales Division (‘CBS') in January 2000.  She was demoted to the position of Senior Sales Executive working under the Account Manager in CBS. She was told CBS required someone with her language skills in English, Putonghua and Cantonese to develop the Mainland China and Taiwan market.  She claimed this later turned out to be untrue for CBS was eventually closed down.  She claimed the transfer was a demotion and her monthly basic salary was reduced from $11,350 to $9,000.  At CBS, she was entitled to a travelling allowance of $2,000 and a guarantee commission of $5,200 each month.  She claimed as she was only allowed the $5,200 monthly guarantee commission, this resulted in a further reduction of income in 2000 compared to the previous year. She further found that contrary to what was promised, Toppan had no plans to develop the Mainland China market. That in spite her efforts in trying to develop the Macau, Taiwan and Mainland China markets, none of her business proposals were seriously taken up nor was she given any support. Business in Macau developed by her was taken away from her after she laid a complaint to the EOC in May 2000.  Information requested by a potential client in Taiwan was not supplied.

Complaints to the Labour Department and the EOC

34.  Ms Chan complained to the Labour Department and filed a claim against Toppan in May 2000 because she had refused to accept her transfer to CBS officially.  And because Toppan had at the Labour Tribunal hearing used the daily activities reports filed by her at the CBS as evidence of her acceptance of the transfer, she had since the hearing in July refused to file any further official daily activities reports.  However, she claimed she had made verbal reports and recorded notes on Mr Fritz Lieu's desk planner instead.  She claimed this practice had been accepted by the senior accounts manager Mr Fritz Lieu and account manager Mr Chet Yim of CBS. 

35.  On 19 September 2000, she received a warning on her failure to file daily activities reports since January 2000.  She denied the allegation and supported her claim by forwarding copies of the daily activities reports between January and July 2000 to her superior at the latter part of September 2000.

The Dismissal

36.  On the day of the warning letter of 19 September 2000, she met with Mr Kato, the Managing Director of Toppan.  She was informed that due to the closing of the CBS, she would be made redundant.  She was further told to withdraw her complaint at the EOC or she would be dismissed.

37.  She claimed that at the end of September and early October 2000, Mr Lieu had refused her application for compassion leave on the death of her father because she was not able to present a death certificate at the time of application although she had a police report proving the death.  She had to obtain leave approval from Human Resources division directly.

38.  On 24 October 2000, she received a warning letter from Mr Yim but she refused to acknowledge it. On 25 October 2000, she was given a formal letter of dismissal from Toppan.

39.  Ms Chan claims damages for injury to feelings and loss of income.  She claimed that she was not able to find another job without a fair reference of her work experience.  Furthermore, the incident had caused her to lose confidence in future job seeking.

The Defence Case

40.  It is the Defendant's case that as an account manager, Ms Chan's job description included dealing with Toppan's existing customers, developing new business with existing customers and locating new customers.  The Defendant admitted that each sale team consisted of a team leader and 2-3 members.

41.  The Defendant denied that Ms Chan's salary package was reduced after the transfer to team U, for she received 60% of the team's sales at team U instead of the 25% at team R.  She should have concentrated on developing new accounts and improving sales that would have a positive effect on her income.  Toppan denied that team U was newly established in 1999 and claimed the transfer of Ms Chan to this team was a usual management decision, the 1998 records of sales and sale percentages of staff was exhibited as evidence in support.

42.  The Defendant claimed Ms Chan's performance in 1999 was below the average standard even after allowances were given to her leave of absence due to pregnancy.  This became a matter of concern and in August 1999, the sales manager Ms Lau requested for a letter of warning to be issued to Ms Chan, but the Manager of Human Resources and Administration (‘HR dept.'), Ms Ewaidy Lo, considered such action to be unsuitable at the time because of Ms Chan's pregnancy.

43.  Ms Lau alleged that Ms Chan's performance continued to be unsatisfactory and on 10 November 1999, she issued two warning memoranda to Ms Chan about certain poorly executed work with the client Kumon and the poor sales returned by her.   A further memo was sent to her on 29 November 1999 notifying her of the areas of her shortcomings, giving her guidelines to follow and requesting her to take up training as a junior sales person.  On 1 December 1999, Ms Lau issued a memorandum on the matter of Ms Chan allegedly placing a duplicated sales order on 1 December 1999 to Mr Chiu. Ms Chan disagreed with Ms Lau's observations and accusations.

44.  Meetings were held between Ms Chan and Ms Lau and between Ms Chan and Ms Lo, the manager of Human Resources in late November and early December 1999 to resolve the concerns and accusations raised by Ms Lau.  Ms Lau recommended Ms Chan's transfer to China Business Sales Division (‘CBS').  

45.  In response to the complaints by Ms Chan of the unfair treatments and accusations by Mr Man and Ms Lau to Mr Chiu and Mr Kato, Toppan conducted an investigation of the allegation of duplication and false order raised by Ms Lau.  Toppan found no documentary basis to support Ms Lau's suspicion and Ms Lau was directed to apologise to Ms Chan in March 2000.

46.  Toppan claimed that Ms Chan had assured the management she was able to handle a larger number of clients, therefore, she should have been able to achieve her sales budget in 1999.  Further, Ms Chan did not complain about being discriminated during her pregnancy or soon after the birth.

47.  It is Toppan's case that Ms Chan maintained a hostile attitude at CBS and therefore the relationship with her colleagues was poor. She regarded her transfer to CBS as a demotion which was denied by Toppan.  It claimed that Ms Chan continued to ignore the requirements of reporting to the office in the morning before visiting clients and submitting daily activities reports in spite of the memoranda from Mr Yim to all staff at CBS on 10 July 2000 and from Mr Chiu to all sales-persons on 18 September 2000.  Mr Lieu and Mr Yim issued a warning letter to Ms Chan on 19 September 2000 regarding her failure to file daily activities reports.  Ms Chan claimed she did file daily reports but she was only able to produce copies of 7 daily activities reports between January and July 2000.  Toppan further claimed her performance continued to be poor and her attitude hostile.  Consequently, her employment was terminated on 25 October 2000. The Defendant claimed that her termination was not connected with her pregnancy for it took place over 1 year after she had given birth.

48.  It is the Defendant's case that Ms Chan's first pregnancy had come to it's notice only after she submitted a medical report in support of her application for sick leave after her miscarriage in June 1998.  That it had only received notice of Ms Chan's second pregnancy after she returned from her sick leave on 1 February 1999.

49.  Mr Man denied the incidents of compelled attendance at work.  He claimed Ms Chan had raised no objections to the invitations for the client was Kumon, a major client handled by Ms Chan. Furthermore, it is the Defendant's case that sales-persons are sometimes required to work irregular hours. 

50.  The Defendant denied any of its staff had ever made any derogatory remarks on Ms Chan's pregnancy.  That Ms Lau's comments to Ms Chan made in 1999 was purely based on her performance and ability.  Further, Ms Chan's transfer in January 2000 took place after she had given birth and it was made at her request to be transferred from team U because of her poor relationship with her supervisors at team U.

51.  The defendant denied it had discriminated and victimized Ms Chan on account of her pregnancy.

The Law

52.  Section 8 of the Sex Discrimination Ordinance provides that:

“A person discriminates against a woman in any circumstances relevant for the purposes of any provision of Part III or IV if –

(a)  on the ground of her pregnancy he treats her less favourably than he treats or would treat a person who is not pregnant; or

(c)  on the ground of her pregnancy he treats her less favourably than he treats or would treat a person who is not pregnant but-

(i)  which is such that the proportion of persons who are pregnant who can comply with it is considerably smaller that the proportion of persons who are not pregnant who can comply with it;

(ii)  which he cannot show to be justifiable irrespective of whether or not the person to whom it is applied is pregnant,

(iii)  which is to her detriment because she cannot comply with it.”

There are two local decided cases on pregnancy discrimination under S.8 SDO, the case of Chang Ying Kwan v Wyeth (HK) Ltd. [2001] 2 HKC 129 and the case of Yuen Wai Han v South Elderly Affairs Limited [2002] 3 HKLRD 621.  Both cases referred to the “but for” test which was the test applied by the courts in similar cases in other jurisdictions such as the English House of Lords case of R v Birmingham City Council ex p Equal Opportunities Commission [1989] AC 1155 and James v Eastleigh Borough Council [1990] AC 751.  The Chang Ying Kwan case further referred to the test applied in cases of victimization cited in cases such as Nagarajan v London Regional Transport [2000] 1 AC 501 and Chief Constable of West Yorkshire Police v Khan [2000] ICR 1065 where the courts held that the “but for” test required the comparator in the case of pregnancy discrimination to be not another pregnant employee but a normal employee.  In the Hong Kong legislation, S. 8(c) of SDO set out the same requirement.

53.  Section 4 of the SDO further provides that:

“If-

(a)  An act is done for two or more reasons; and

(b)  One of the reasons is the sex, marital status or pregnancy of a person (whether or not it is the dominant or a substantial reason for doing the act),

then, for the purposes of this Ordinance, the act shall be taken to be done for the reason specified in paragraph (b).”

Application of English Law

54.  The Hong Kong legislation in relation to discrimination is similar to the Sex Discrimination Act and the Race Relations Act in the U.K.  A large body of case law had been formed since the passing of these acts in the U.K.  Because of the similarities of the English and the Hong Kong legislations, Hong Kong courts have looked to the English decisions for guidance on the interpretation of the Hong Kong legislation.  They remained to be persuasive authorities in appropriate cases.  In the case of Chang Ying Kwan, Judge Saunders set out the basis and extent of the application of the English authorities on the cases in Hong Kong under the SDO and the interpretation of the English Courts of equivalent legislation in the UK.

55.  On Page 134 of the report he said:

 “The Appropriate Text

The forms of discrimination alleged by Miss Chang, i.e. as a consequence of pregnancy and victimization consequent upon a complaint to the EOC, are commonly called direct discrimination.  In cases of direct discrimination, the approach to determining whether there is a less favourable treatment on the prohibited ground is the “but for” test denounced by the House of Lords in R v Birmingham City Council ex p Equal Opportunities Commission [1989] AC1155 and James v Eastleigh Borough Council [1990] 2 AC 751.  The same test is applied in cases of victimization:  see Nagarajan v London Regional Transport [2000] 1 AC 501.”

56.  The ‘less favourable treatment' test is applied both in the discrimination and victimization claims.  In the case of Aziz v. Trinity Street Taxis Ltd. [1988] ICR 534, Slade L J held that by expelling Mr Aziz the association had treated him less favourably than other members.  But, to constitute victimization, according to Slade J., the motive which caused the alleged discrimination to treat the complainant less favourably than others must be a motive consciously connected with the race relation legislation.  Lord Nicholls of Birkenhead in the case of Chief Constable of West Yorkshire Police v. Khan said at p. 1071 para. 23 – 28 “The statute is to be regarded as calling for a simple comparison between the treatment afforded to the complainant who has done a protected act and the treatment which was or would be afforded to other employees who have not done the protected act.”

57.  In the English Court Appeal Case of King v. GB - China Centre [1992] ICR 516 at p. 528 F to H Neill L.J. held:

“From these several authorities it is possible, I think, to extract the following principles and guidance.  (1) It is for the applicant who complains of racial discrimination to make out his or her case.  Thus if the Applicant does not prove the case on the balance of probabilities he or she will fail.  (2) It is important to bear in mind that it is unusual to find direct evidence of racial discrimination.  Few employers will be prepared to admit such discrimination even to themselves.  In some cases discrimination will not be ill-intentioned but merely based on an assumption that “he or she would not have fitted in”.  (3) The outcome of the case will therefore usually depend in what inferences it is proper to draw from the primary facts found by the Tribunal.  These inferences can include, in appropriate cases, any inferences that it is just and equitable to draw in accordance with section 65 (2b) of the Act of 1976 from an evasion of equivocal reply to a questionnaire.  (4) Though there will be some cases where, for example, the non-selection of the applicant for a post or for promotion is clearly not on racial grounds, a finding of discrimination and a finding of difference in race were often point to the possibility of racial discrimination.  In such circumstances, the Tribunal would look to the employer for an explanation.  If no explanation is then put forward or if the Tribunal considers the explanation to be inadequate or unsatisfactory it will be legitimate for the Tribunal to infer that this discrimination was on racial grounds.  This is not a matter of law but, as May L.J. put it in North West Thames Regional Health Authority v Noone [1988] 1 ICR 813, 822; “almost common sense.”  (5) It is unnecessary and unhelpful to introduce the concept of a shifting evidential burden of proof.  At the conclusion of all the evidence the Tribunal should make findings as to the primary fact and draw such inferences as they consider proper from those facts.  They should then reach conclusion on the balance of probabilities, bearing in mind both the difficulties which face a person who complains of unlawful discrimination and the fact that it is for the complainant to prove his or her case.”

58.  In the case of Yuen Wai Han v. South Elderly Affairs Limited [2002] 3 HKLRD 621, Judge Wong found in favour of the plaintiff for the reason that the defendant in that case was in breach of Section 8(a) of the SDO on the ground of the plaintiff's pregnancy that she was treated less favourably than a person who was not pregnant.  The plaintiff in that case applied for the post of part time social worker on Sundays for the defendant.  When interviewed for the part time position she told the defendant she was 4 months' pregnant.  After working in the part time position for two weeks she was asked if she was interested in the post of supervisor with the defendant.  She was told at an interview for the position of supervisor that her qualification as a social worker would bring a professional image to the Defendant.  She resigned from her current position and signed the contract for the post of supervisor with the defendant but the defendant terminated the contract before the plaintiff reported for duty.  Judge Wong at paragraph 21 of his judgment referred to the case R v Birmingham City Council ex p Equal Opportunities Commission (No. 1) [1985] AC1155 at 1194 where Lord Goff held:

“There is discrimination under the statute if there is less favourable treatment on the ground of sex, in other words, if the relevant girl or girls would have received the same treatment as the boys but for their sex.  The intention or motive of the defendant to discriminate, though it may be relevant so far as remedies are concerned, is not a necessary condition of liability; it is perfectly possible to envisage cases where the defendant had no such motive and yet did in fact discriminate on the ground of sex.”

59.  The “but for” and “less favourable treatment” test was applied by the Hong Kong Court of Final Appeal in S J & Others v Chan Wah & Others [2000] 3 HKLRD 641.  In King v Great Britain – China Centre [1992] ICR 516 at p.528 G to H, Neill L J held:

“3.     The outcome of a case will therefore usually depend on what inferences it is proper to draw from the primary facts found by the tribunal.  These inferences can include, in appropriate cases, any inferences that it is just and equitable to draw from an evasive or equivocal reply to a questionnaire.”

60. Mr Lui, counsel for the Defendant, relied on the case of Berresford v. Woodard School (Midlands Division) Ltd. [1991] ICR 564 and the case of Dixon v. Rees [1994] ICR 39.  Mr Leung, counsel for the Plaintiff, submitted that the ratio of Webb v. Emo Air Cargo (UK) Ltd. [1990] ICR 442 on which the cases of Berresford and Dixon were decided had been reversed after the matter was referred to the European Court of Justice by the House of Lords for a ruling on consistency with the European Council Directive.

61. The background of the Webb case can be found in the question referred by the House of Lords to the ECJ, which is as follows:

“Is it discrimination on grounds of sex contrary to Directive (76/207/E.E.C.) for an employer to dismiss a female employee (‘the applicant') (a) whom he engaged for the specific purpose of replacing (after training) another female employee during the latter's forthcoming maternity leave, (b) when, very shortly after her appointment, the employer discovers that the applicant herself will be absent on maternity leave during that period, (c) had the employer known of the pregnancy of the applicant at the date of the appointment, she would not have been appointed, and (d) the employer would similarly have been dismissed a male employee engaged for this purpose who required leave of absence at the relevant time for medical or other reasons?” 

62. The EEC Directive 76/207 is as follows:

“For the purposes of the following provisions, the principal of equal treatment shall mean that there shall be no discrimination whatsoever on ground of sex either directly or indirectly by reference in particular to marital or family status.”

63. The ECJ ruled that (see [1994] ICJ 770) the dismissal of a female worker on account of pregnancy constitutes direct discrimination on ground of sex.  It held:

“24. First, in the response to the House of Lord's inquiry, there can be no question of comparing the situation of a women who finds herself incapable, by reason of pregnancy discovered very shortly after the conclusion of an employment contract, of performing the task for which she was recruited with that of a man similarly incapable for medical or other reasons.   …

“26. Furthermore, contrary to the submission of the United Kingdom, dismissal of a pregnant woman recruited for an indefinite period cannot be justified on grounds relating to her inability to fulfil a fundamental condition of her employment contract. The availability of an employee is necessarily, for the employer, a precondition for the proper performance of the employment contract.    However, the protection afforded by Community law to woman during pregnancy and after childbirth cannot be dependant on whether her presence at work during maternity is essential to the proper functioning of the undertaking in which she was employed.  Any contrary interpretation would render ineffective the provision of the Directive.”

64. The House of Lords in Webb v. Emo Air Cargo Ltd. (No.2 ) [1995] ICR 1021) allowed the appeal of the applicant after the ruling of the ECJ on the question referred to it by the House of Lords and remitted the case back to the Industrial Tribunal for assessment of compensation.

65. Mr Leung further referred to Toohey J.'s judgment in IW v. City of Perth (1997) 191 CLR 1 at page 33 where he held:

“It would fatally frustrate the purposes of the Act if the matters which it expressly identifies as constituting unacceptable bases for differential treatment ...could be seized upon as rendering the overall circumstances materially different with the result that the treatment could never be discriminatory within the meaning of the Act.”

66. The effect on the law brought about by the decision in Webb (No 2) means that should the Court be satisfied that the treatment of the applicant was based on her pregnancy, it is not an adequate explanation for the employer to claim that it would have treated a comparator in the applicant's circumstances in the same way. 

67. In Hong Kong, the Court is assisted by the provision under Section 4 of the SDO.  Section 4 in the context of the present case provides that if the act is done for two or more reasons and one of which is pregnancy, then “the act shall be taken to be done” for the reason of pregnancy.  It follows that if in the present case Ms Chan was found to have been treated unfavourably due to her pregnancy, even if there was a second reason for her treatment, the acts (under s.4) shall be taken to be done because of her pregnancy.

Findings

68.  The burden is on Ms. Chan to show there was discrimination under the SDO on a balance of probabilities.  Once the Court is satisfied that Ms. Chan has shown from the primary facts that inferences can be drawn that disclosed a possibility of discrimination, the Court will look to the employer for an explanation.  If there is no reasonable or satisfactory explanation put forward, the Court will draw an inference of discrimination as a matter of common sense.  This was the conclusion of Neill L.J. in King v. GB - China Centre after he considered the relevant authorities and the dictum of May L.J. in North West Thames Regional Health Authority v. Noone [1988] ICR 813. Neill L.J. referred to the following passage in May L.J.'s judgment at p.528 B-D:

“In these cases of alleged racial discrimination it is always for the complainant to make out his or her case.  It is not often that there is direct evidence of racial discrimination, and these complainants more often than not have to be dealt with on the basis of what are the proper inferences to be drawn from the primary facts.  For myself I would have thought that it was almost common sense that, if there is a finding of discrimination and of difference of races and then an adequate or unsatisfactory explanation by the employer for the discrimination usually legitimate inference will be that the discrimination was on racial grounds.”

69. Applying the same test to the present case, the Court will look at the primary facts raised by Ms Chan to determine whether she had established a case of discrimination based on her pregnancy.  Ms Chan has established the following against the Defendant:

(a)  evidence of good performance, good relationship with clients and previous good sales record;

(b)  changes in management attitude and treatment after she became pregnant, had a miscarriage and took pregnancy related sick leave and maternity leave before and after childbirth between 1998 and 2000;

(c)  derogatory and insulting remarks made by senior management staff during her pregnancy;

(d)  evidence of repeated demands by the supervisor during her pregnancy compelling her to return to work and attend to clients during sick leave and black-storm warnings while other employees were treated differently;

(e)  transfers to a one person team in DMS in 1999 and CBS division in 2000 without prior consultation or consent after the employer discovered she was pregnant and after she gave birth;

(f)  reduction of income after transfer with unfair appraisals and humiliating requirements for re-training imposed;

(g)  demotion after the second transfer with further reduction of income;

(h)  appraisals and repeated warnings based on unsupported allegations of poor and sub-standard  performance and groundless accusation of fraudulent behaviour;

(i)  failure to conduct investigation on fully justified complaints lodged by her to senior management.

70. Both Mr Leung and Mr Lui accepted and relied on the approach adopted by the Court in the case of Chang Ying Kwan in considering the evidence in the round in the context of employment and human relations, and the dignity and rights accorded to a person by the equal opportunities legislation.  I have adopted this approach in my consideration of the evidence adduced in this case.  As the incidences referred to by the Plaintiff were many, I shall only refer to some of them in my findings.  Suffice it to say, I have weighed the evidence of all the witnesses and taken into consideration all the documents exhibited. 

71. I find Ms Chan to be an honest witness, her evidence is consistent with the memoranda issued and letters exchanged.  I am satisfied on a balance of probabilities that Ms Chan has established the primary facts on her claim based on discrimination under the SDO.  The Defendant is required to give a satisfactory explanation of it's treatment of Ms Chan and her eventual dismissal.  My findings are based on the principle and guidance set out in Neill L J's judgment in King v. GB-China Centre.

Ms Chan's Performance

72. The Defendant claimed that Ms Chan's performance in 1999 fell below standards.  This was Mr Man and Ms Lau's reason for criticizing Ms Chan's performance at team U and their poor appraisals of her work and her attitude in 1999.  Ms Chan, however, was able to show that she was praised for her high achievements both in 1997 and 1998, she was made a member of Toppan's Achievement Club in 1997 and awarded a free trip to Japan.  She was popular amongst her colleagues at the time, this is supported by the fact that was invited to be the master of ceremony at Toppan's 25^th anniversary party in 1998.  It is not disputed that in spite of comments about her ‘strong will' her 1998 appraisal report was a satisfactory one. 

73. Toppan claimed that Ms Chan was given most of the clients she was handling in team R when she was transferred to team U but she failed to develop new customers and market new products to existing clients. Ms Chan, On the other hand, claimed that she was not allowed to bring some of her clients such as Aeon Credit Card and Citibank with her to team U other than Kumon and Crocodile.  She claimed that she is a trained graphic designer and her previous experience was not in sales.  Furthermore, at the time she was employed, it was made clear that she would not be required to make cold calls and actively recruit new customers.  At team R, work such as routine follow up and cold calls were performed by sales executives. After she was transferred to team U, there were no sales executives to assist her, yet she was criticised for failing to recruit new clients to improve sales in team U in spite of the lack of support.

74. Ms Chan was further criticized for not reporting to work before making early morning visits to clients' offices.  Ms Chan's explanation was that the early morning visits were known to be a preferred practice of her major client Kumon and she was not picked on before she notified her superior that she was pregnant. At the same time, other staff members were not criticized for the same practice.  From the Defendant's swipe card records exhibited, it is evident that Ms Chan was not the only staff making early morning visits and these visits were also reported and recorded each time.  The record showed it was a prevalent practice of the Defendant's staff to make early morning visits.

75. Ms Lau admitted that after her transfer to DMS as the senior sales manager, she felt it was her duty to improve sales and was anxiously urging managers working under her to perform better.  While it is understandable that she should be anxious to show that she was capable of achieving better sales, it is a different matter if in order to do so, she had deliberately put particular pressure on a particular member of staff because she was pregnant and had been put on sick leave and maternity leave due to her pregnancy compared to a member of staff who had not been pregnant.  Ms Lau, in her evidence, repeatedly compared Ms Chan's sales figures in 1999 with another staff Monique Wong who was not pregnant.  She pointed out that Ms Chan had due to her pregnancy taken 127.5 days of sick leave and maternity leave in 1999, this clearly showed that she was anxious that the sick leave and maternity leave taken by Ms Chan would affect the annual sale of the teams supervised by her.  Instead of taking the pregnant employee's condition into consideration, Ms Lau concluded that Ms Chan had performed poorly because she was pregnant and always on sick leave and therefore had failed to achieve the same or a higher level of sales compared to the previous year.  This can be seen from the comments she made to Ms Chan after she became pregnant in early 1999 and the August 1999 memorandum to Ms Ewaidy Lo requesting for a warning letter to be issued to Ms Chan.  While she may not have intentionally discriminated Ms Chan because of her pregnancy, her actions amounted to acts of discrimination.

76. While Ms Chan was on maternity leave, Ms Lau issued 2 memoranda on 10 November 1999 accusing Ms Chan of fraudulent conduct and poor performance.  Ms Chan, however, was able to show that the incident of printing error was caused by the printing team and the letter solicited by Ms Lau from Kumon supported Ms Chan's claim that Kumon was satisfied with her performance.  As to the allegation of false sales report, an investigation conducted by Mr. Chiu resulted in Ms Lau withdrawing her complaint against Ms Chan.  Ms Lau's readiness in levelling unverified and unsubstantiated accusations of errors and fraudulent conduct at Ms Chan demonstrated her bias opinion of Ms Chan.

Requirement to Work During Sick Leave

77. Mr Man, Ms Chan's supervisor at team U, claimed that it was up to Ms Chan to refuse his requests to return to work to handle Kumon's account during her sick leave.  He claimed that in the end, he did allow her to leave the factory early after Ms Chan complained repeatedly that she was unwell and her bleeding had persisted during the visit. These insensitive responses fully reflected the attitude of the Defendant's management staff that either the employees' welfare was not its concern or Ms Chan was singled out because of her pregnancy.  It was clearly unreasonable for him to insist Ms Chan to return to work on the Saturday during her sick leave because it was her long week.

78. If, in total disregard of the pregnancy and the health of the employee, the employer required the employee to report for duty during her sick leave due to threatened abortion; compelled her to work late hours when she was 8 months pregnant where there was no real need to stay in the office until 11 pm; cancelled her previously approved leave during black–storm signals without prior warning or notification, when no other employee was treated in the same way, the only reasonable inference to be drawn is that the employer wanted the employee to experience particular pressure because of her pregnancy.  It is also unlawful under S.8(a) & (b) of the Ordinance.  In the present case, there was no evidence adduced by the Defendant to show that it had demanded other employees on sick leave to return to work in the same way it had required Ms Chan to do.  On the other hand, Ms Chan has successfully shown from documents exhibited that other employees were granted leave on the two mornings of black-storm warnings and they did not have their annual leave deducted, while her annual leave was deducted because Mr Man had filed a leave application on her behalf without her knowledge or consent.  The Defendant failed to explain the difference in treatment.

Transfer to Team U

79. Ms Chan objected to the transfer to team U claiming that it was without good cause and against her wish.  Mr Alan Mok, supervisor at team R, persuaded her to accept the transfer, she was promised 80% share of the commission. The promised 80% commission did not materialise, in March 1999 she was told she would get only 60%, no explanations for the reduction were given.  The person who benefited from the commission at team U was her supervisor Mr Man who also headed team Q.  Ms Chan claimed that the reason for the transfer or the commission percentage was never put in writing contrary to company policy, and she was never consulted.  The Defendant explained the transfer was the company's usual arrangement. 

80. I am satisfied Ms Chan was reluctant to move to team U and no reason for the transfer had been given in writing.  I am also satisfied that she was entitled to be consulted for it obviously had an effect on her income and her work.  It is not disputed that she received no support at team U and a new account (Top Glory Insurance) successfully solicited by her was immediately transferred out of team U.  The Defendant claimed at the trial that it was more appropriate for other staff to handle the account, but failed to explain why Ms Chan was told at the time the removal was an inadvertent mistake.   Clearly, Ms Chan had been denied the fruits of her labour.  This is another example of her unfair treatment by the Defendant.

81. Ms Chan claimed that during a sales promotion in February and March 1999, dining vouchers were given to clients placing an order of over $50,000.  These, however, were not given to Ms Chan's clients.  The Defendant failed to given an explanation for the disparity of treatment.  While the Defendant claimed Ms Chan's transfer was a usual company move, the same answer was given for the arrangement for Ms Chan to be the only member in team U when all other DMS teams have 2-4 members.   Neither did the Defendant explain why Ms Chan was not given any follow up support from senior management for a newly solicited client (Carltex) at DMS who had requested for a meeting with Ms Chan's supervisors concerning further business with Toppan.

82. Ms Chan believed she was not allowed to remain in team R because she would share the commission earned by the whole team, and when she was transferred to a new team with fewer clients than before, it would have a negative effect on her income.  The Defendant claimed team U had been in existence and in operation in 1998, that it was not a new team; however, in a letter dated 17 July 2000 to the EOC in response to Ms Chan's EOC complaint, the Defendant's reply in paragraph 4 (i) (p.128 of the bundle) was ‘Ms Chan was chosen to handle the new team U because of her experience'.  While the Defendant claimed it would be more efficient to have 4 teams in DMS to handle different products and customers, it failed to explain why Ms Chan was the only person in team U when the other 3 teams had 2-4 members.  It is clearly not a satisfactory explanation when Ms Chan would only be allowed to keep two of her clients from team R at the new team U and doing exactly the same type of work as before but without the support of other team members or account executives.  The circumstances and conditions of the transfer constituted acts of deliberately omitting to afford her access to benefits, facilities or services in contravention of s.11 (2) (a) of SDO.

83. Furthermore, Ms Chan claimed she took annual leave on 18 November and 30 November to 2 December 1998 because she was advised to rest in bed due to her 2^nd pregnancy.  She told Mr Caric Lee, the then Senior Manager, in December 1998 that she would not be able to take part at the Defendant's exhibition/trade fair in early 1999 to avoid complications with her pregnancy.  The Defendant denied it was told of her pregnancy before Ms Chan's transfer to team U in January 1999; furthermore, the Defendant argued that Ms Chan's confinement was in mid September 1999, her pregnancy therefore could not have commenced in November 1998.  Ms Chan's leave records at tab 160 (p.421-426) showed that Ms Chan did take advance annual leave on 18 November and 30 November to 2 December 1998. No medical certificates accompanied the two applications.  Whereas the 18 January to 30 January, February and March 1999 sick leave applications were supported by medical certificates testifying that she was suffering from threatened abortion.  Such evidence is not inconsistent with her becoming pregnant in late November or early December.  I accept Ms Chan's evidence that she had made it plain to Mr Caric Lee and Mr Chiu that she intended to raise a family in spite of her miscarriage in May 1998 and in late November or early December 1998 she indeed became pregnant again and had informed Mr. Lee of it in December.  Her confinement in September 1999 does not remove the possibility that her pregnancy was diagnosed in December 1998.  It is unlikely that it was diagnosed in November given that a normal term of pregnancy is between 38 to 42 weeks.

84. Based on the aforesaid, there is evidence in support of the claim that the transfer was made because the Defendant or its management staff knew Ms Chan was pregnant and she would be taking maternity leave in 1999.  Her leave taking would obviously affect team R or team Q's annual earnings, therefore she was sent to team U in January 1999.  It is foreseeable when Ms Chan was transferred to a team with her as the only member, her sales volume and earnings would not affect anyone but herself.  It should be clear to her supervisors that while she had no support from account executives or other team members and she was required to develop a new customer base at a time when she was pregnant, her performance in sales was bound to suffer.  Ms Chan's transfer as the only member of team U, without the support previously available to her and working with only 2 of her team R clients made her job a more difficult one.  Her resistance to the transfer was the cause of her constant disagreement with her new supervisors Mr Man and Ms Lau and Ms Lau's complaints of her attitude.  All in all, the transfer was clearly detrimental to Ms Chan in many respects. 

Transfer to CBS

85. Ms Chan resisted the transfer to CBS in early 2000.  She considered it a demotion because she was re-located to CBS as an account executive, a position which she claimed was a rank below her previous account manger position.  This claim of ranking difference is supported by the Defendant's DMS structure table.  Further, the transfer came also after Ms Lau issued a memorandum on 1 December 1999 to Ms Chan accusing her of dishonesty for duplicating a sales report purportedly submitted by Mr Man on her behalf during her maternity leave.  Her refusal to accept the transfer and demotion was justified for the accusation of falsifying sales report was later withdrawn by Ms Lau after Ms Chan appealed to the general manager Mr Chiu.

86. Ms Chan's claim of demotion is further supported by her subsequent discovery that the CBS division was intended to be axed by the Defendant.  The Defendant did not deny that CBS was eventually closed down.  It claimed that Ms Chan had accepted the transfer because the alternative was to dismiss her.  This may well have been the intention of the senior staff at Toppan, but there is no documentary evidence or otherwise to show that Ms Chan was told of this decision. On the contrary, Ms Chan was told at the time that it was not a demotion and the transfer was the result of her request for transfer.  Ms Chan admitted that she had requested for a transfer back to her old team, team R in DMS, not a transfer out of DMS.

87. The Defendant admitted that they had considered the dismissal of Ms Chan, but decided to transfer her to CBS as an alternative.  Given this was the motive behind the transfer of Ms Chan to CBS, the move would have given Toppan the means to declare Ms Chan redundant upon the closure of CBS.  It lends further credence to Ms Chan's claim that she was given no support from her supervisors at CBS, the rejection of her market expansion proposals for mainland China, Macau and Taiwan and the Defendant's failure to follow up upon her recruitment of a new client in Taiwan.

88. Mr Leung in his submission suggested that the Defendant had intended to create an unfavourable working environment for Ms Chan in the hope that she may voluntarily resign from her employment at Toppan.  Based on the evidence adduced by Ms Chan, this is a highly credible motive behind the Defendant's treatment of Ms Chan during and after her pregnancy.

89. Ms Lau rated Ms Chan's performance in 1999 to be below-standard based on the budget sales figures set by Ms Lau.   According to the ECJ ruling adopted by the House of Lords in Webb (no. 2), the protection to the employee is afforded to her ‘during her pregnancy and after childbirth notwithstanding her presence at work during maternity is essential to the proper functioning of the undertaking in which she was employed'.  The facts in this case revealed that because Ms Chan was pregnant and had taken sick and maternity leave, she was criticised for under performing.  Because of the rated sub-standard performance, she received a poor appraisal report in 1999, based on which Ms Lau recommended for Ms Chan's transfer, to be re-trained as a junior sales person and demotion to CBS (see memo of 29 November 1999).  

90. I find the reasons given by the Defendant for Ms Chan's transfer to team U from team R in 1999 and her demotion to CBS in January 2000 to be inadequate and unsatisfactory.  It was natural for Ms Chan to feel humiliated and degraded because of the actions of Mr Man and Ms Lau.  I am satisfied based on the aforesaid, the two transfers and demotion were discriminatory and unlawful treatment under Section 11(2)(a) of SDO.   

91. From the documents exhibited, in particular, the correspondences and memoranda exchanged, I am satisfied on a balance of probabilities that Ms Chan was discriminated on ground of her pregnancy; from the reasons given and, in many instances, the lack of satisfactory explanations by the Defendant in response to Ms Chan's claim of unfair treatment, and base on the evidence in the round, a legitimate inference can be drawn that Ms Chan had been discriminated because of her pregnancy.

Victimisation

92. It has been shown that Toppan had put further pressure on Ms Chan after she told senior Human Resources staff that she would be making a complaint to the EOC in December 1999.   When Ms Chan complained to Ms Lo about the transfer to CBS against her will, she was advised to go to the Labour Tribunal, she did so in May 2000.  She also laid a complaint at the EOC in the same month.  I accept that because the filing of daily activities reports was used as evidence of her acceptance of the transfer to CBS at the Labour Tribunal, Ms Chan had stopped filing these reports in writing formally and made reports orally and informally. She claimed this was later used as one of the reasons for her dismissal in October 2000.  Unfair pressure was placed on Ms Chan after she told the Defendant she was going to complain to the EOC.  Clearly, it was the cause of her unfair treatment in mid-2000 leading to her dismissal in October 2000.  This amounted to victimization under Section 9 (1) (d) of the SDO.

93. Based on the facts referred to by Ms Chan and the failure of satisfactory explanations from the Defendant, I am satisfied that Ms Chan was transferred to team U in 1999 and to CBS in 2000 against her wish. Furthermore, the transfer to CBS was a demotion on the basis that she had taken sick leave and maternity leave of 127.5 days in 1999 and had performed poorly in sales compared to other staff members who had not been pregnant or taken the same number of days of leave.  Ms Lau had at an early stage labelled Ms Chan a trouble-maker, there was no explanation as to why she was so labelled other than her poor attitude towards Ms Lau and Mr Man.  Due to the pressure Ms Lau and Mr Man had put on Ms Chan, it is to be expected that Ms Chan would feel aggrieved and angry at Mr Man and Ms Lau.  It is evident from Ms Lau's August 1999 memorandum to Ms Lo that she could not work with Ms Chan.  She therefore recommended dismissing Ms Chan or transferring her out of team U.   Because of Ms Chan's pregnancy at the time, it would obviously be unlawful for the Defendant to do so.  Clearly, the transfer to CBS was adopted as a step before her dismissal.  There was a clear loss of trust and goodwill due to the Defendant's unfair treatment of Ms Chan in 1999.

94. Ms Chan was dismissed in October 2000 purportedly because she had under performed in sales, adopted a poor attitude to her supervisors, resisted the transfer to team U and demotion at CBS and failed to file official daily activities reports after she commenced the Labour Tribunal proceedings.  And because she had informed the Defendant's senior management that she would be filing a complaint to the Equal Opportunities Commission and the Labour Tribunal she was shunned by her colleagues and was taken off certain accounts and duties, the working environment at Toppan had became even more difficult for her.  The evidence showed that Ms Chan was victimized because she made or had threatened to make a report to the EOC contrary to S. 9 of the SDO.

95. Based on the aforesaid, I am satisfied the Plaintiff has successfully shown that the Defendant had discriminated and victimized Ms Chan due to her pregnancy and the Defendant has failed to give reasonable and adequate explanations that its treatment of Ms Chan was justified. The Defendant is therefore liable under s. 8 and S. 9 of the SDO.

Damages

96. Damages for the statutory tort of discrimination under S. 76 of the SDO are recoverable if the Defendant is found to be in breach of Part III of SDO.  Ms Chan claims damages under the heads of loss of earnings, loss of earning capacity and injury to feelings.  She accepts that credit will be given to the compensation she may receive in the Labour Tribunal proceedings.

Loss of Earnings

97. Ms Chan claims a loss of earnings after she was transferred to team U in 1999 and a further reduction of her over-all income in 2000. She claimed that if she had not been transferred to team U in 1999 and CBS in 2000 her income would not have suffered.  As there was no change to her basic salary in 1998 and 1999, the difference in income was the reduced income from commission.  There was a reduction in Ms Chan's monthly basic salary at CBS from $11,350 to $9,000, she received instead a $2,000 monthly travelling allowance.  There is also a marked reduction in her income from commission at CBS.

98. So far as the commissions earned in 1999 were concerned, each account manager's monthly and annual sales from his/her accounts have been set out in a table and his/her earning percentage within the team would be tabulated (see p.553-554 of the bundle of documents).  Each account manager's performance in the year can be traced on this table of monthly and annual sales.  Based further on the Defendant's evidence and documents, about 88% of Ms Chan's commission in team R in 1998 had came from the Kumon and Crocodile accounts.  Since she took these two accounts with her to team U, had the sale of products to these clients been maintained, her income from commission would not have been much affected.  As to her claim that sales to these clients were known to be reducing in value in 1999, it would have happened even if Ms Chan and her two clients had remained in team R.  She would have to seek new clients in order to improve the volume of her sales in any event.  To a certain extent, she did so, but had the new client removed from her in the case of Top Glory.  As the Defendant failed to disclose the DMS sales to Top Glory at the relevant date, it is not possible for the Court to make any assessment on Ms Chan's loss caused by the loss of this account.  On the basis that any reduction in sales from the Kumon and Crocodile accounts could have been compensated by the improvement of sales of new products and recruitment of new clients, and at the same time it is a relevant concern that Ms Chan had taken 127.5 days of leave in 1999.  The leave taken by her must have an impact on her income from commission based on sales.  It is conceivable that her leave taking would have reduced the time she spent on recruitment of new clients and marketing of new products. 

99. Based on Ms Chan's 1998 earnings, about 50% of her annual income came from her share of the team's commission, it follows that the fall in Ms Chan's sales volume in 1999 meant that her income must suffer accordingly.   I find Ms Chan's reduced earnings in 1999 was caused directly by the fall in sales in team U.  Even though the reduction of sales may have partly been contributed by the removal of some of Ms Chan's clients at team R, it remained doubtful if Ms Chan could still have achieved her 1998 sales volume in 1999 had she remained in team R after she had taken 127.5 days of leave out of 286 work days in 1999 (365 – 65 – 14 annual leave).  Based on an analysis of her 1999 commission, out of the 300 work days of the year less 14 days annual leave, she put in (127.5- 14) / (300-14) = 39.68% less of her colleagues' work days in 1999.  The $82,426.90 commission she earned in 1999 represented 39.59% of the $208,151.90 earned by her in 1998.

100. Consequently, the figures showed while the transfer from team R to team U may have affected her morale, it would not have affected the commission earned by her in 1999 unless she was sharing the commissions earned by other colleagues in team R to supplement her own income. 

101. It is a different case with the transfer to CBS in 2000.  Ms Chan's basic monthly salary was reduced to $9,000 in 2000.  She received $2,000 travelling allowance monthly and was guaranteed 4 months commission of $5,200 per month.  The combined monthly income fell far short of her 1998 and 1999 income.  This transfer to CBS was based on the recommendation of Ms Lau and supervisor Mr Man.  The transfer had clearly caused Ms Chan a loss of income in 2000. The loss was due directly to the demotion with a reduction of basic salary at the CBS and she was deprived of the client accounts previously handled by her such as Kumon and Crocodile. 

102. Adopting Mr Leung's calculations on loss of income, on the basis that Ms Chan did work full time up to 25 October 2000 (there was no evidence to the contrary), based on the Defendant's basis for calculation of commission from 1 April to 31 March of the following year, Ms Chan's commission at DMS in the 12 months prior to her transfer to team U, i.e. 1 April 1998 to 31 March 1999, was $208,151.90.  The total income including salary, travelling allowance, CNY bonus and commission in 1998 was $359,301.90 (136,200+208151.90+3600+11350).  Her income including severance pay in 2000 was $194,796.70 (81,000+55,900+18,000+7,372.60+13,500+19,024.10), Ms Chan's loss in 2000 was $(359,301.90 – 194,796.70) = $164,505.20.

Further Loss of Earnings

103. Ms Chan has a duty to mitigate her loss by actively seeking alternative employment.  She claimed she had found a job at a printing firm which paid her a monthly salary of $ 32,000 after she left Toppan, but during her employment, the proprietor was embarrassed by the knowledge of Ms Chan's dispute with Toppan and she lost her job in May 2001.  She claimed she has lost confidence in seeking similar employment subsequently.  She exhibited a few letters of job applications in support.  She asks for 12 months earnings at the level of her earnings in 1998 at Toppan as compensation under this head.

104. On the issue of loss of future earnings, Judge Christie in his judgment in the case of K & Others v. Secretary for Justice [2000] 3 HKLRD 777 at p. 817J – 818B said:

“In support I am referred to the following passage in Discrimination: Remedies and Quantum at p.73, para.3.1.3  ‘Future Losses:

In the vast majority of cases the court or tribunal will approach its tasks as in an unfair dismissal claim, assessing the period of loss primarily as being limited to the time in which the applicant might reasonably be expected to find other employment. As a result, periods of future loss may be limited to 12 –24 months, or even less.' …

…I do not think the learned authors of Discrimination: Remedies and Quantum meant that there is a cap to claims for future losses in discrimination cases. They were, it seems, assuming assessments in cases where the plaintiffs had yet to find alternative work. In such cases assessments of two years or less as the time it would take to find employment are understandable. This must depend, however, on the facts of each case. In discrimination claims in England, there is no cap on future loss, as the concluding passage of the judgment of the EAT (Morrison J) in Minister of Defence v. Cannock [1994] IRC 918 at p. 955G makes clear:

‘In our guidance, we respectfully suggest that industrial tribunals need to keep a due sense of proportion when assessing compensation. Some of the applicants have received awards more appropriate for a person who has lost a career due to some kind of continuing disability. All of these applicants who were entitled to any award of compensation of loss of earnings are assumed to have been ready willing and able to resume their career in the services six months after their first child was born and, therefore, ready willing and able to undertake reasonably suitable alternative employment. To this extent, their compensation for loss of  earnings is not likely to be different from the thousands of cases of unfair dismissal with which the industrial tribunals are having to deal with each year, albeit, that there is no cap on the award.' “             

105. Following the ratio in the case of Ministry of Defence v. Cannock, I am satisfied that with Ms Chan's work experience and training in design, she should be able to find employment commensurate with her experience within a reasonable period of time.  She in fact did so soon after, but for the circumstances of her dismissal at Toppan, she would have been gainfully employed.  Unlike the Cannock case & the case of K. & Ors. v. Secretary for Justice, Ms Chan is looking for a job in the private sector, not in the disciplinary forces.  She should be able to find alternative employment within 6 months.  I allow damages equivalent to 6 months of her earnings in 1998 in the sum of $(359,301.9/12) x 6 = $179,650.95.

Injury to Feelings

106. Ms Lau clearly held a biased opinion of Ms Chan, this is evident from her memoranda to senior management accusing her of fraud and mistakes in 1999 and 2000.  Mr Man demonstrated his prejudice against Ms Chan during her pregnancy by requiring Ms Chan to report for duty during sick leave, work late hours unnecessarily and cancelled her black storm warnings leave approval.

107. Judge Wong in the case of Yuen Wai Han v. South Elderly Affairs Ltd. [2002] 3 HKLRD 621 referred to the guidelines set out in the English case of Vento v. Chief Constable of West Yorkshire Police [2003] 1CR 318.  The award of $62,500 was upheld by the Court of Appeal, it held that general awards in this type of cases should not be less than $50,000 based on the guideline in Vento.  The Vento guidelines in a similar category were between £5,000 and £15,000.

108. Mummery L J held in his judgment in the English Court of Appeal case of Vento para. 46 – 47 at p. 330-331:

“46  This is the first time for many years that the Court of Appeal has had the opportunity to consider the appropriate level of compensation for injury to feelings in discrimination cases.  Some decisions in the employment tribunal and in the appeal tribunal have resulted in awards of substantial sums for injury to feelings, sometimes supplemented by compensation for psychiatric damage and aggravated damages…” 

“47  Compensation of the magnitude of £125,000 for non-pecuniary damage creates concern as to whether some recent tribunal awards in discrimination cases are in line with general levels of compensation recovered in other cases of non-pecuniary loss, such as general damages for personal injuries, malicious prosecution and defamation.  In the interest of justice (social and individual), and of predictability of outcome and consistency of treatment of like cases (an important ingredient of justice), this court should indicate to employment tribunals and practitioners general guidance on the proper level of award for injury to feelings and other forms of non-pecuniary damage.  (See paragraphs 65 – 68 below.)”

“53        In Prison Service v Johnson [1997] ICR 275 Smith J reviewed the authorities on compensation for non-pecuniary loss and made a valuable summary of the general principles gathered from them.  We would gratefully adopt that summary.  Employment tribunals should have it in mind when carrying out this challenging exercise.  In her judgment on behalf of the appeal tribunal Smith J said, at p 283: 

“(i)   Awards for injury to feelings are compensatory.  They should be just to both parties.  They should compensate fully without punishing the tortfeasor.  Feelings of indignation at the tortfeasor's conduct should not be allowed to inflate the award.  (ii) Awards should not be too low, as that would diminish respect for the policy of the anti-discrimination legislation.  Society has condemned discrimination and awards must ensure that it is seen to be wrong.  On the other hand, awards should be restrained, as excessive awards could, to use the phrase of Sir Thomas Bingham MR [in John v MGN Ltd [1997] QB 586, 611], be seen as the way to ‘untaxed riches'.  (iii) Awards should bear some broad general similarity to the range of awards in personal injury cases.  We do not think that this should be done by reference to any particular type of personal injury award, rather to the whole range of such awards.  (iv) In exercising that discretion in assessing a sum, tribunals should remind themselves of the value in everyday life of the sum they have in mind.  This may be done by reference to purchasing power or by reference to earnings.  (v) Finally, tribunals should bear in mind Sir Thomas Bingham's reference to the need for public respect for the level of awards made.”

109. At para. 65 he gave a guidance in this type of cases:-

           “Guidance

65          Employment tribunals and those who practise in them might find it helpful if this court were to identify three broad bands of compensation for injury to feelings, as distinct from compensation for psychiatric or similar personal injury.  (i) The top band should normally be between £15,000 and £25,000.  Sums in this range should be awarded in the most serious cases, such as where there has been a lengthy campaign of discriminatory harassment on the ground of sex or race.  This case falls within that band.  Only in the most exceptional case should an award of compensation for injury to feelings exceed £25,000.  (ii) The middle band of between £5,000 and £15,000 should be used for serious cases, which do not merit an award in the highest band.  (iii) Awards of between £500 and £5,000 are appropriate for less serious cases, such as where the act of discrimination is an isolated or one off occurrence.  In general, awards of less than £500 are to be avoided altogether, as they risk being regarded as so low as not to be a proper recognition of injury to feelings.

66          There is, of course, within each band considerable flexibility, allowing tribunals to fix what is considered to be fair, reasonable and just compensation in the particular circumstances of the case.

67          The decision whether or not to award aggravated damages and, if so, in what amount must depend on the particular circumstances of the discrimination and on the way in which the complaint of discrimination has been handled.

68             Common sense requires that regard should also be had to the overall magnitude of the sum total of the awards of compensation for non-pecuniary loss made under the various headings of injury to feelings, psychiatric damage and aggravated damage.  In particular, double recovery should be avoided by taking appropriate account of the overlap between the individual heads of damage.  The extent of overlap will depend on the facts of each particular case.”

110. In K. & Ors. v. Secretary for Justice, Judge Christie awarded between $100,000 to $150,000 to the plaintiffs who after having been offered the jobs were rejected after their families' medical histories were revealed. 

111. Ms Chan was discriminated and treated unfavourably due to her pregnancy.  She was demoted after her maternity leave in 2000 based on the poor appraisal of her work during her pregnancy in 1999, and because she had resisted her transfers to team U in DMS in 1999 and demotion in 2000 and because she had lodged a complaint to the EOC in May 2000, she was victimized and she was deliberately marginalised and isolated, resulting in her being shunned by her colleagues.  She was justifiably aggrieved; she felt depressed and humiliated.  She was further deprived of a favourable reference for the 3¼ years she was employed at Toppan. The unfair treatment until her dismissal in late October 2000 lasted about 2 years.  Bearing in mind the Vento guidelines and applying them to the present case, damages under this head in the high end of the middle band would be an appropriate award, I award the sum of $200,000 under this head accordingly.

Written Apology and Reference letter

112.  The aforesaid assessment was made on the basis that an apology would be forthcoming from the Defendant and would provide Ms. Chan with a reference letter.  Based on the Plaintiff's case, she is entitled to be given an appropriate reference letter which reflected her abilities and experience so that she may seek alternative employment.

113.  In the Court of Final Appeal case of Ma Bik Yung v. Ko Chuen [2002] 2 HKLRD 1, Li C.J. held in paragraph 34:-

“Order for apology on the assumption that the defendant is willing to apologise

34. To apologise is simply to say sorry.  An apology is a regretful acknowledgement of a wrong done.  It can be made privately or publicly.  The making of an apology will usually redress, at least to some extent, the loss or damage, particularly injury to feelings, suffered by the plaintiff as a result of the defendant's unlawful conduct under the Ordinance……

35. Where the defendant contests liability but the court after trial makes a finding of liability against the defendant, the court may then consider the question whether it would be appropriate to order an apology.  In many cases, the court may well decide that an apology would be appropriate.  An apology, even at this late stage after a finding of liability, could have the effect of redressing at least to some extent the plaintiff's loss and damage.  So long as the making of the apology is a reasonable act for the defendant to perform, the court may order an apology.”

114.  Li C.J. further set out the appropriate procedure for the remedy of an order for an apology in his judgment.  At the hearing of the trial, the Defendant's Counsel Mr. Lui did not address the Court on this issue or indicate to the Court if the Defendant would apologise to Ms Chan should it be found to be liable under the SDO.  I shall give the parties an opportunity to make representation on the issues of the reference letter and apology at a date to be fixed.

Summary of Damages

115. The following damages in pursuant to S. 76 of the SDO are awarded:

(a) Loss of earnings	$164,505.20
(b) Loss of future earnings	$179,650.95
(c) Injury to feelings	$200,000.00
Total:	$544,156.15

116. Interests on loss of earnings from the date of dismissal to date of judgment at half judgment rate and thereafter at judgment rate. Interests on damages for injury to feelings at 2% p.a. from the date of writ to the date of judgment thereafter at judgment rate until full payment.

117. At the request of counsel, a date will be fixed for submissions on costs.