HA WAN HUNG v. EVERLASTING HOLDINGS (HONG KONG) LTD.

HCLA 3/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 3 OF 2000

(ON APPEAL FROM LBTC 10244/1999 & 10722/1999)

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J U D G M E N T

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1. The Claimant (Respondent) was employed by the Appellant company. On 7 September 1999 the Respondent gave one month's notice of termination to terminate her contract of employment with the Appellant which was duly approved. The Respondent left her job on 14 September 1999 before the expiration of one month.

2. The Respondent in Labour Tribunal Claim No. LT10244 of 1999 claimed against the Appellant for (i) arrears of wages; (ii) annual leave payment; (iii) end of year payment. The subject matter of this appeal is in respect of the end of year payment.

3. On 9 December 1999 during the call over there was the following exchange of conversation between the Appellant's representative and the Presiding Officer:-

"Representative of the Defendant company:

It is because I do not know that according to the law of the Labour Department (sic), I should still pay the claimant the year-end double pay even though it is the claimant herself who resigned.

Presiding Officer:

(Employment Ordinance)

According to S.11(f) of this Ordinance, it is clearly stated that if an employee has worked for more than three months within a year, the defendant company should pay the claimant the part of the year-end double pay she is entitled to on a pro rata basis according to the days she has worked within a year in the event that the employer-employee relationship should come to an end. In other words, it is clearly stated in the (Employment Ordinance) that it should be paid.

Representative of the Defendant company:

Okay.

Presiding Officer:

Is the Defendant company willing to pay?

Representative of the Defendant company:

If I ...... I think that I ...... If the Defendant company should pay, I shall definitely pay.

Presiding Officer:

That means is the Defendant company willing to pay or not willing to pay?

Representative of the Defendant company:

(The Defendant company) is willing to pay."

4. It was by reason of the explanation of law which induced the Appellant to concede and consent to the Respondent's claim on "end of year payment".

5. The Appellant's ground of appeal is that the Presiding Officer misdirected the Appellant on the effect of S.11F.

6. S.11F(1)(a) of the Employment Ordinance states:-

"11F. Proportion of the end of year payment

(1) Subject to subsection (1A), where, in the case of an employee to whom this Part applies who has not been employed by the same employer for the whole of a payment period but has been so employed for a period of not less than 3 months in the payment period- (Amended 74 of 1997 s.8)

(a) the contract of employment is terminated-

(i) at any time during the payment period; or

(ii) on the expiry of the payment period,

otherwise than by the employee under section 6 or 7 or by the employer under section 9; or"

7. It is abundantly clear that this sub-section does not apply where contracts of employment are terminated under Ss.6, 7 or 9.

8. The Respondent tendered her resignation pursuant to S.6 of the Employment. Therefore S.11F(1)(a) does not apply. The explanation the Presiding Officer gave in respect of S.11F(1)(a) during the call over which led the Appellant to concede was clearly wrong in law.

9. Counsel for the Respondent has quite properly and fairly conceded this point and I therefore allow the appeal on this point.

10. However this is not the end of the matter. Judgment was entered by consent. The Presiding Officer has not heard evidence leading to the Respondent quitting her job before the expiry of the one month's notice.

11. The Respondent's case is that she suffered from irritable airway disease. After she had tendered her resignation one of the Appellant's directors started to smoke constantly in her working area and that the air cleaner in her working area was deliberately removed after she tendered her resignation. Due to the intolerable working condition, she considered she was constructively dismissed by the Appellant.

12. So there remains a finding of fact by the Presiding Officer as to whether it was a termination of contract of employment by the Respondent under S.6 or was she constructively dismissed under S.10 by the employer. If she were constructively dismissed then the acts of her employer would have superseded her notice of termination of her contract of employment and S.11F would therefore apply.

13. For reasons above I allow the appeal and set aside the award in respect of end of year payment and that the case be remitted back to the Labour Tribunal to hear evidence and to make a finding of facts as to whether the Respondent had been constructively dismissed.

14. As to costs counsel for the Respondent argued that it was the Presiding Officer who was wrong and Respondent should not be penalised in costs. However there is no evidence as to whether the Respondent had indicated she would concede the appeal on the point of law. The Appellant is obliged to come to argue and costs have been incurred. The Appellant is therefore entitled to costs of this appeal and I make the costs order in favour of the Appellant accordingly.