MAK KIN HUNG DONALD AND OTHERS v. OPG HUMAN RESOURCES LTD

HCLA22 & 23/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 22 OF 2009

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO. 1193 OF 2009)

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(Heard Together)

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DECISION

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1.  This is the defendant’s applications for leave to appeal against the awards of the Deputy Presiding Officer made on 2 July 2009 in LBTC 1193/2009 and LBTC 1327/2009.  The two actions were tried together.  By the awards, the Presiding Officer allowed the claims for wages in lieu of notice, annual leave pay and severance pay of the 1^st to 5^th claimants in LBTC 1193/2009 and the 1^st to 4^th and 6^th claimants in LBTC 1327/2009 (collectively “the Claimants”).

2.  As the Applications for Leave to Appeal on Point of Law only contain general grounds of appeal, Amended Applications containing amended grounds of appeal, that are based on the submissions of defendant’s counsel were filed subsequent to the hearing.  The amended grounds in both applications are identical.  In deciding on the applications for leave to appeal, I shall have regard to the amended grounds. 

Background facts

3.  The claimants were employed by the defendant as reporters or head reporters.  At the relevant time, they worked in the “Breaking News Section, News Agency” (新聞部突發組) of the Oriental Press Group.  The claimants were dismissed by the defendant on different dates between 28 November and 4 December 2008.  In each of the notices of dismissal, it was stated that the claimants were summarily dismissed for contravening the work rules, serious misconduct and divulging news information (違反工作守則，嚴重行為不當，對外洩露新聞資料).    

4.  The claimants brought claims in the Labour Tribunal against the defendant for wrongful dismissal, claiming, inter alia, wages in lieu of notice, annual leave pay and severance pay.  The defendant disputes their claims. 

5.  In the statements of defence filed in the two actions, the defendant says the claimants were summarily dismissed under section 9 of the Employment Ordinance and on the basis of clause 8.7 of the Staff Handbook (員工手册) (“the Handbook”).  It is evident from the statements of defence that the defendant was referring to the 23 June 2008 version of the Handbook.  In LBTC 1193/2009, the statement of defence reiterates that the claimants had divulged new information, contravened work rules and guilty of serious misconduct.  As for LBTC 1327/2009, the statement of defence adds that the claimants had contacted fellow media workers and/or made enquiry from fellow media workers about news information. 

6.  The core issue in the trial before the Presiding Officer is whether the defendant is entitled to summarily dismiss the claimants under section 9 of the Employment Ordinance.  The other issue relates to whether the claimants are entitled to severance pay.

7.  The Presiding Officer found that summary dismissal is not justified in each of the claimant’s case.  He also found a case for ordering severance pay.  Accordingly, he awarded the claimants their claims for wages in lieu of notice, annual leave pay and severance pay.

Intended grounds of appeal

8.  Under section 32(1) of the Labour Tribunal Ordinance, cap.25, leave to appeal against the award or determination of the Labour Tribunal may only be granted where the same is (a) erroneous in point of law, or (b) outside the jurisdiction of the Tribunal.  The threshold onus of the applicant is to show that the intended appeal is arguable.

9.  The intended appeal is based on five grounds.  They are:

(1)  The Presiding Officer erred in applying an overly restrictive construction of clause 8.7.1 of the Handbook in light of the evidence of the 4^th claimant in LBTC1193/2009 and the claimants’ expert witness, Miss Law (羅綺萍), which shows that the defendant has traditionally imposed strict restrictions against its reporters engaging in any form of communications with employees of other media organizations. 

(2)  Alternatively, the Presiding Officer erred in failing to discharge his statutory duty to conduct investigation into potential issues arising from the evidence on the defendant’s blanket prohibition against its reporters engaging in any form of communications with employees of other media organizations.

(3)  Had the Presiding Officer not disregarded the aforesaid evidence and had carried out the investigation, he ought properly to have found that the true effect and meaning of clause 8.7.1 is to prohibit the 1^st to 5^th claimants in LBTC1193/2009 against engaging in mere communications with employees of other media organizations since any form of communication using company mobile phone is likely to involve divulging the defendant’s information.

(4)  The Presiding Officer erred in approaching the core issue of whether the defendant is entitled to dismiss the claimants summarily by sole reference to customary standard of reporter’s conduct as stated by the claimants and their expert witnesses.  The Presiding Officer should have approached the issue from the perspective of the defendant’s entitlement as an employer to dictate the mode of operations of its businesses.  The Presiding Officer misunderstood the evidence of the defendant’s witness, Mr Kwok (郭慶榕) on the defendant’s mode of business operations and took into account irrelevant considerations such as the evidence on acceptable conduct in the trade.

(5)  The Presiding Officer ought to have found that the defendant is entitled to dismiss the claimants summarily by reason of the conduct of each of the claimant.

10.  Mr Lo confirmed at the hearing that the defendant is not advancing any separate ground to challenge the award of severance pay.  

Basic observations

11.  Before analyzing the intended grounds of appeal, it is necessary to make several observations that are essential to the understanding of the Presiding Officer’s reasons and to set the context for the consideration of the intended grounds of appeal.

12.  The first of these matters relates to the terms of the employment contracts.  The Presiding Officer found as a fact that when the claimants joined the service of the defendant, they were each given a copy of the Handbook.  The Handbook was therefore incorporated into and forms part of the claimants’ employment contracts.  Since its publication in October 1991, the Handbook had undergone six amendments.  The Presiding Officer found that not all the amendments were incorporated into and become part of the employment contracts.  Importantly, the Presiding Officer found that only in the case of the 1^st and 2^nd claimants in LBTC 1193/2009 and the 1^st claimant in LBTC 1327/2009, was the 6^th amendment incorporated into and became part of the employment contracts.

13.  The second matter relates to the contractual provision relied upon by the defendant as providing the basis for summary dismissal.  As noted above, clause 8.7 was introduced by the 6^th amendment to the Handbook made on 23 June 2008.  In the previous editions of the handbook, the relevant provisions only prohibited divulgence of news and company information to people outside the company, and did not prohibit contacts with fellow media workers (i.e. clause 8.7 under the 2^nd amendment and clause 8.8 under the 3^rd to 5^th amendments).  

14.  Under clause 8.7.1, divulgence of news and company information obtained by the employee in the course of employment is prohibited.  Further under clause 8.7.2, an employee shall not, unless with prior permission, contact fellow media workers, which includes enquiring, exchanging or verifying any news information, so as to preserve confidentiality of news before they are published or broadcasted.  The clause also provides that if an employee has relative or friend working in other media organization, he should take care not to touch upon news or company information in his contact with the relative or friend.         

15.  As a matter of construction, contrary to the case of the defendant in the trial below and in this leave application, clause 8.7.2 does not impose a blanket or total ban against any form of contact with employees of other media organizations.  The clause contemplates: (a) contact with prior permission; and (b) contact with relatives or friends who are employees of other media organizations provided that the communication should not touch on any news or company information.     

16.  The third matter relates to the defendant’s reason or ground for summary dismissal.  It is the defendant’s case that the claimants had made telephone contact with reporters of other newspapers and had divulged news information belonging to the defendant.  Except in the case of the 2^nd claimant in LBTC1327/2009, these telephone contacts all took place before 23 June 2008, the date of the 6^th amendment.  Accordingly, clause 8.7 (in particular clause 8.7.2) is not engaged as it could not be a term of their employment contracts.  It follows that the defendant cannot invoke clause 8.7 as the ground for summary dismissal of these claimants.

17.  Insofar as the defendant says that, independent of clause 8.7.1, the previous editions of the Handbook had prohibited divulgence of news information, it is important to note that the claimants (except the 3^rd claimant in LBTC1193/2009 who denied making telephone contact) had given evidence on the reasons for making the telephone contacts and the contents involved.  All claimants denied divulging news information of the defendant.  The Presiding Officer, as he was entitled to, had accepted their evidence.  It follows that notwithstanding the claimants might have made telephone contacts with reporters of other newspapers or media organizations, there is no finding that they had divulged news information in these contacts.      

Ground (1)

18.  I now turn to look at the intended grounds of appeal.  Ground (1) is directed at the Presiding Officer’s finding in paragraph 34 of the Reasons for Decision that, contrary to the evidence of the defendant’s witness, Miss Kong, there was, until the 6^th amendment, no express provision in the Handbook banning contact with employees of other media organizations.  The evidence of Miss Kong that was rejected by the Presiding Officer, is that the defendant has for many years prohibited contact with employees of other media organization. 

19.  It is a fact that before the insertion of clause 8.7.2, there was no express provision in the Handbook banning contact with employees of other media organization.  The Presiding Officer cannot be faulted for so stating.  And in making this finding, the Presiding Officer had not mis-construed clause 8.7.1.  In respect of the evidence of the 4^th claimant in LBTC 1193/2009 (paragraph 5 of his witness statement), the conversation he had with Mr Lee (李大業) that was quoted therein took place in November 2008. When he answered that he knew employees were not allowed to telephone fellow media workers, he had not specified the time frame of his knowledge.  This applies also to the evidence of the claimants’ expert, Miss Law, which was quoted in counsel’s written submission.  Their evidence does not lend support to the defendant’s case that it has always prohibited contacts with employees of other media organizations.      

20.  More fundamentally, even assuming the Presiding Officer had erred on rejecting the evidence of Miss Kong or had taken a restrictive view of clause 8.7.1, it will have no impact on the core issue of whether the defendant was entitled to summarily dismiss the claimants since the defendant’s ground for dismissal of the claimants is plainly breach of clause 8.7.2 and also having regard to the basic observations stated above.

Ground (2)

21.  As for Ground (2), it is a general assertion.  No particular has been given as to the aspects that the Presiding Officer is said to have failed to investigate.  Further, for the reasons set out in the preceding paragraphs, whether the defendant has always prohibited contacts with employees of other media organizations is immaterial since the defendant’s case for summary dismissal is an express term in the Handbook, which was only inserted on 23 June 2008.

Ground (3)

22.  Ground (3) follows from, and therefore stands or falls with, Grounds (1) and (2).  In any case, clause 8.7.1 (and its equivalent provisions in the pre-23 June 2008 editions of the Handbook), hence its construction, is not engaged given that they do not form any part of the ground for dismissal.

Ground (4)

23.  I turn next to Ground (4).  Under this ground, the defendant seems to suggest the Presiding Officer’s finding that summary dismissal is not justified is as a result of: (a) his acceptance of the claimants’ and their experts’ evidence that it is an acceptable practice for reporters to communicate, and (b) his rejection or misunderstanding of the defence evidence as to the rationale underlying the prohibition against contacting reporters of other media organizations.  But this is not the case.  It is in the context of setting out the evidence adduced at the trial that the Presiding Officer referred to the experts’ evidence that it is customary and acceptable practice for reporters to contact fellow reporters in the course of their work. In the same vein, the Presiding Officer , when dealing with the defence case and evidence, had referred to Mr Kwok’s evidence on the rationale and justification for the prohibition against contacting reporters of other newspapers.  To this extent, the Presiding Officer had not disregarded Mr Kwok’s evidence.  In paragraphs 44 to 65 of the Reasons for Decision, the Presiding Officer went on to analyze each of the claimant’s case and give specific reasons and findings on the core issue of summary dismissal.   It is clear from reading these paragraphs that the customary or acceptable practice is not a material factor in the Presiding Officer’s conclusion that the defendant has not made out a case of section 9 summary dismissal against each of the claimants. 

24.  Indeed, given that for all except one of the claimants, the prohibition in clause 8.7.2 was not part of the employment contract at the time of the alleged misconduct, whether the defendant is entitled or justified to impose the prohibition cannot bear significantly on the outcome of the case.   It should also be noted that under clause 8.7.2, a reporter may contact reporter of other media organization if he has permission to do so.   In the case of several of the claimants, the Presiding Officer found as a fact that they were instructed by their superior and/or the control room to contact reporters of other newspapers.  The Presiding Officer was therefore of the view that even if clause 8.7.2 applies, the claimants did not act in breach of it.  This is a view that the Presiding Officer is entitled to, on the basis of the evidence before him.  This finding further illustrates the immateriality of the defendant’s rationale or entitlement to impose the prohibition in clause 8.7.2 vis-à-vis the conclusion on the core issue.

Ground (5)

25.  Turning finally to Ground (5), this is in essence challenging the conclusions reached on each of the claimants’ claim. 

26.  In the case of the 1^st and 2^nd claimants in LBTC 1193/2009, Mr Lo pointed out that they had admitted contacting reporters of another newspaper on the defendant’s phones and the 1^st claimant, Mr Mak, further admitted he had in the course of these contacts, passed on news information to reporters of the other newspaper.  Mr Lo therefore argued that the defendant was entitled to summarily dismiss them.  However, the facts as found by the Presiding Officer are that they had ceased to commit these acts after they were told off in May 2008.  It is not in dispute that the defendant was aware of these contacts in May 2008.  Having decided not to terminate the employment then, the defendant could not rely on these contacts to summarily dismiss these claimants some six or seven months later.  The suggestion that the defendant did not in May 2008 appreciate the gravity of the matter does not afford a justification for summary dismissal in December 2008.

27.  In the case of the 2^nd claimant in LBTC 1327/2009, Mr Lam Po Yik, the telephone contacts he made with reporters of other newspapers took place in July, August and September 2008, after the implementation of the 6^th amendment to the Handbook.  The Presiding Officer found that the 4^th to 6^th amendments were not incorporated into and did not form part of his employment contract as he was not aware of these amendments.  Mr Lo submitted that the Presiding Officer’s approach was erroneous in that under the preamble of the Handbook, the employee agreed to pay attention to the notice board and to follow the latest announcement made by the defendant.  It is said that since the defendant had posted the amendments on the notice board, it had taken steps to bring the amendments to the claimants’ notice.  However, before the amendments can be incorporated to become part of the employment contract, Mr Lam must have notice and knowledge of the amendments.  Even though he was under a contractual obligation to pay attention to the notice board and that he had failed to observe it such that he was unaware of the amendments, it does not mean that the amendments will, without more, become part of the employment contract.

28.  Further, even if clause 8.7.2 were to apply, the Presiding Officer had found that two of the contacts were made with prior permission and the other contact was to enable him to carry out his work for the defendant.  The Presiding Officer further noted that clause 8.7.2 does not impose a total ban, but does allow contacts with friends working in other media organizations provided that such contacts do not touch upon news or company information.  It is Mr Lam’s evidence that the reporters he contacted are his friends.  It is also of significance to note that Mr Lam was not involved in breaking news.  He was a photographer at the material time.  It is the evidence of the defence witness, Mr Kwok that for non-breaking news (靜態新聞), there is no issue of exclusivity.  Taking all these into account, there is no room for arguing that the Presiding Officer’s conclusion on Mr Lam’s claim is erroneous as a matter of law.

29.  As for the 3^rd claimant in LBTC 1193/2009, Mr Wong Hok Man, the only evidence adduced by the defendant is that Mr Lee (李大業) was told by other reporter(s) that he had once contacted a reporter of another newspaper.  Mr Wong, however, denied contacting reporters of other media organization, which was accepted by the Presiding Officer.  In these circumstances, the Presiding Officer must be entitled to find that there is no evidence of Mr Wong making contact with reporter of another newspaper.  It is clearly a finding of fact is not open to challenge by way of appeal.

30.  As for the rest of the claimants, having regard to the fact that the telephone contacts they made were before the 6^th amendment, the Presiding Officer’s conclusion that the defendant has not made out a case of summary dismissal under clause 8.7.2 must be correct.  Additionally, the Presiding Officer had accepted their evidence on the reasons and contents of the telephone contacts they made with other reporters and found that the contacts did not amount to breach of clause 8.7.2, even if it were to apply.  In these circumstances, there is no arguable ground to disturb the conclusions reached by the Presiding Officer.  

Conclusion

31.  In conclusion, the defendant has not demonstrated that the intended appeals involve any arguable point of law.  The applications for leave to appeal are refused.