WONG MEI LING GLORIA v. XIE EN INTERNATIONAL HOLDINGS LTD. t/a AMIS

HCLA 38/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 38 OF 2009

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO.4205 / 2009)

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REASONS FOR DECISION

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A.    Introduction

1.  This is the hearing of the application of Xie En International Holdings Ltd (the Defendant) for leave to appeal against the award (“the Award”) of the Labour Tribunal dated 6 November 2009. 

2.  The Award is in favour of the Plaintiff (Ms Wong) for her claims against Xie En for payment in-lieu-of notice and outstanding salary with interest.   The total sum awarded is some HK$71,000.00 odd.

3.  In gist, the reasons of the learned Presiding Officer in granting the Award are premised on his findings, after trial, that (a) Ms Wong was at the material time an employee of Xie En with a monthly salary of $30,000.00, and (b) Xie En was not entitled to summarily dismiss Ms Wong under s. 9 of the Employment Ordinance (Cap 57). 

4.  As a result, the Presiding Officer ruled that Xie En, in terminating Ms Wong’s employment, was liable to pay her outstanding wages from 10 March 2009 (when Ms Wong started work) to 20 April 2009, and 1 month payment in lieu under ss. 5-7 of the Employment Ordinance.

5.  After the hearing, I refused to grant leave to Xie En.  I now set out my reasons for my decision.

B.    Brief background of the claim in the Labour Tribunal

6.  Xie En carries on the business, inter alia, of providing beauty-related services in the Mainland, Hong Kong and Singapore.  Part of the business involves the wholesale and retail of beauty-related products.

7.  There is no dispute that:

(1)    Ms Wong was engaged by Xie En to become a sales director in Mach 2009, and one of her duties was to set up a sales team to promote and market the products sold by Xie En.   

(2)    Ms Wong started her duty on 10 March 2009 with Xie En. 

(3)    By an email dated 17 April 2009, a Ms Bowie Mak of Xie En forwarded to Ms Wong a letter issued by a Ms Ng of Xie En addressed to Ms Wong.  In the letter, it was stated that Xie En was giving her 1-day notice to terminate the “employment relationship” with Ms Wong with effect on 19 April 2009.  The reasons stated in the letter for termination the relationship were that her ability did not match that of the company’s business plans and that she had not brought any effective improvements to the company’s business.  Ms Wong said she only received this email on 20 April 2009, but nothing turns on this at this leave application.

(4)    Ms Wong had not received any payments by Xie En for her duties or works that had been carried out for this period, ie, from 9 March to 19 April 2009.

8.  As a result, Ms Wong brought her claims against Xie En in the Labour Tribunal for outstanding wages and payment in lieu of notice.   

9.  For the present purpose, Xie En’s defences raised in the Labour Tribunal were in principal that (a) Ms Wong was not engaged by Xie En as an employee but an independent contractor, and thus not entitled to any payment of wages or payment in lieu of notice, and (b) in any event, even if she were an employee, Xie En was entitled to summarily terminate her employment by reason of her repeated lateness in going to work. 

10.  As I mentioned above, after hearing the evidence, the Presiding Officer accepted Ms Wong’s evidence, and ruled that she was an employee of Xie En and that there was no justification to terminate her employment summarily.

C.   The application for leave

C1.  Applicable principles

11.  Mr Vincent Lung, Counsel for Xie En, rightly and fairly accepts that the following principles apply to an application for leave to appeal:

(1)    Under s 32 of the Labour Tribunal Ordinance (Cap 25), a party may only apply for leave to appeal on the ground that the award of the Tribunal is erroneous on point of law or outside its jurisdiction.

(2)    The threshold onus of an application for leave is to show that the intended appeal is arguable:  Chan Kwok Hung v Hotel Panorama Co Ltd (unrep., HCLA 30/2009, Chu J, 19 November 2009), at para13.

(3)    Findings of fact of the Tribunal are immune from challenge unless such is perverse or irrational, or where there is no evidence to support the decision or where the decision was made by reference to irrelevant factors or without regard to relevant factors:  Kei Siu Hung v CAF Securities Co Ltd (unrep., HCLA 39/2008, Deputy High Court Judge To, 27 November 2008), para 4, adopting Kwong Mile Services Ltd v Commissioner of IRD [2004] 3 HKLRD 168 (CFA), paras 31-37.

C2.  Intended grounds of appeal

12.  Mr Vincent Lung submits that the intended grounds of appeal are as follows:

(1)    The contract between Ms Wong and Xie En was not an employment contract but a contract for services.  The Tribunal erred in law in that there was insufficient evidence to support any employment relationship.

(2)    Alternatively, even if Ms Wong was Xie En’s employee, the Tribunal wrongly failed to take into account of sufficient evidence to show that Xie En was entitled to summarily dismiss Ms Wong. 

13.  I will deal with each of these grounds of appeal as follows.

C3.    Ground 1: Insufficient evidence to find an employment relationship

14.  The learned Presiding Officer dealt with his findings of an employment relationship between the parties in light of the evidence primarily at paragraphs 8 to 14 of his reasons for decision^[1] (“the Reasons”) as follows:

“8． 謝小姐在証人供詞裡面說申索人和被告公司有僱傭關係，職位是銷售經理，屬特約員工，沒有基本底薪（見謝雪容証人供詞D-2）。袁小姐在証人供詞裡面說，因為對申索人工作表現很失望，所以被告公司解僱申索人（見袁桂雲証人供詞D-3）。本席認為，由以上可見被告公司看待申索人為被告公司僱員。被告公司代表何敏兒（“何小姐”）則先在口供詞寫申索人是被告公司「沒有合約的員工」，後來將供詞改為申索人不是員工（見何敏兒証人供詞D-1）。何小姐在2009年4月27日才入職被告公司，作供時何小姐同意，她對申索人和被告公司的關係，並無親身的認識，只是從謝小姐和袁小姐得知。將謝小姐和袁小姐與何小姐上述証供相比較，本席認為前者的証供比較可信。

9．   據申索人提供的工作詳情（C6(1) - (14)）衡量，申索人按謝小姐指示替被告公司工作，可見被告公司對申索人有僱主應有的控制權；申索人親自替被告公司工作，沒有僱用幫工；申索人以被告公司員工身份和客戶應酬，為被告公司面試銷售員職位申請人，又參予被告公司會議，從事的工作涉及被告公司主要業務，應可正確地被識別為被告公司組織一份子。

10． 申索人說她每月月薪30,000元，另有佣金收入。謝小姐說申索人沒有底薪，只可能會有達標獎金和佣金收入。無論如何，申索人無需集資，也無需購置昂貴器材或工具，並沒有營商固有之風險 。

11． 以上各點都支持申索人是被告公司僱員的主張。

12． 美容產品行業常外判產品給分銷商零售，但也常僱用銷售員以僱員身份作銷售。行業的傳統結構及慣例方面考慮因素，在本案而言屬中性指標。

13． 被告公司沒有替申索人報薪俸稅或開立僱員長期服務金戶口，但申索人上班只有一個多月，也從未獲發任何工資，所以這一點考慮因素，在本案而言也是一個中性的指標。

14． 對於同類案件，雙方是否有僱傭關係的處理方法，終審法院在Poon Chau Nam v. Yim Siu Cheung [2007] HKLRD 591一案裡面已經作出明確有約束力的指引。在該案李義常任法官在判案書第18段裁定：「法庭在考慮及裁斷一名人士是僱員或自僱人士時，現行的做法是按照過往的判例所得的指標去審視納入雙方關係的所有特徵，以整體印象來裁定雙方的關係是否屬僱傭關係；在同類案件裡面，很多都涉及不同的指標和因素，有些指標和因素顯示雙方存有僱傭關係，有些則相反。法庭在考慮這些指標及因素的重要性及應予的比重時，須根據個別案件不同案情而作出，不能一概而論」。本席認為在本案而言，被告公司對於申索人應有之控制權和雙方的實際經濟關係，屬於比較重要的考慮因素。本席認為，以上種種顯示，申索人並非在經營、運作自己的生意。小心考慮全部証供以後，本席判定申索人是以僱員身份向被告公司提供服務。” (emphasis added)

15.  Mr Lung accepts that the Presiding Office applied the correct legal test as set out in the Poon Chau Nam case in his assessment of the evidence under this issue.

16.  However, he submits that the Tribunal was wrong in concluding at paragraph 9 of the Reasons that Xie En had exercised control over Ms Wong’s work.  Mr Lung submits that the evidence referred to by the learned Presiding Officer (i.e., C6(1)-(14)^[2]) did not constitute any evidence to show control.  He says the evidence, taking to the highest, can only be fairly said that Ms Wong was quite active in the participation of Xie En’s business. 

17.  I disagree.   I am satisfied that Ms Wong’s witness statement, which was accepted by the Tribunal, contained sufficient evidence to reasonably enable the Presiding Officer to conclude that there was control by Xie En over Ms Wong’s work.  One notable example is at page 9 of the said statement, where Ms Wong dealt with the facts that it was Xie En which decided in which locality she should based her work, and that she was required to prepare a written plan for business development and report and discuss the same with Ms Tse of Xie En.  She also emphasized that, as Ms Tse was “the boss”, she had to follow her instructions to do things.  She said as follows:

“二零零九年三月二十七日星期五

約applicants 在酒店裏面試,只有兩個出現，上一次檢討時，決定如有合適的人選，馬上讓他們簽約，但最後還是沒有聘請成功。謝來電跟我說，他讓我今後只留在香港工作，建立完整的銷售團隊以及來年的銷售策略，希望我在四月三日能拿這份計劃告她介紹和討論。我當時有點突然，因為她說的，和當天瞭解的工作性質不一樣，於是我問謝是否覺得我不適合這份工作，如果大家沒有誤會，她是老闆，我必定按她指引的去做。若然真不適合，她不妨直講，但她表示沒有這個意思，她是想把香港的銷售提高，還說才剛開始不會那麼容易放棄，叫我趕緊把計畫完成，待她從星加坡回來，到時向她介紹各項建議，並落實執行，掛電話後馬上開始搜集資料。” (emphasis added)

18.  In light of the above example, and reading the statement as a whole, I cannot see how it can arguably be said that it was perverse, irrational or even unreasonable for the Presiding Officer to conclude that Xie En had exercised control over Ms Wong’s works. 

19.  Mr Lung further challenges the Tribunal’s finding of an employment relationship on the fronts that some other factors considered by the Tribunal could only be neutral to the question of whether there was an employment relationship.   I can deal with these challenges quickly as follows:

(1)    It is submitted that the Tribunal erred in prematurely jumping to the conclusion that Ms Wong’s involvement in Xie En’s core business and in providing administrative or business advice “unequivocally” suggested an employment relationship.    I do not see any such “unequivocal” conclusion reached by the Tribunal in its reasoning.    As mentioned above, it is not disputed that the Tribunal rightly applied the test by looking at all the circumstances and factors in the relationship to determine the nature of the work relationship between the parties.  Insofar as these matters were concerned, the Tribunal only treated them as part of the entire circumstances to be put in the weighing process for determination.   In particular, the Presiding Officer made it clear in his finding at paragraph 14 of the Reasons that he attached more weight to the control factor and financial relationship between the parties in coming to his conclusion.   There is thus no merit in this challenge.

(2)    It is further said that the Tribunal did not have sufficient regard to the possibility that Ms Wong in fact undertook financial risk.  These submissions^[3] are premised on Xie En’s own case that Ms Wong did not have any fixed salary, and was only entitled to bonus and commissions.  In my view, the submissions cannot even get off the ground, as they assume that Xie En’s case and evidence was accepted by the Tribunal.   But the Tribunal expressly rejected Xie En’s said case and evidence^[4], and Mr Lung is not saying (and there is also nothing to show) that the Tribunal was wrong in law in rejecting Xie En’s evidence.

(3)    Mr Lung appears to also argue that the Tribunal had put too much weight on Ms Wong’s title as “sales director” and the use of the name card given to her to “unambiguously” reflect an employment relationship.   Mr Lung refers in his submission to paragraph 15 of the Reasons, which states as follows:

    “15. 申索人提交的名片，上面寫有申索人的職位為“Sales Director”，並非甚麼特約兼職銷售員。謝小姐的證供是在她公幹時，申索人叫公司麥小姐替申索人印名片，謝小姐事先並不知情。本席相信申索人在職時已經使用名片，期間申索人和謝小姐緊密接觸（詳情見C-6(1) - (14)），謝小姐不會不知。”

(4)    I see nothing in this part of the Reasons to support Mr Lung’s criticism.   This must also be read together with other parts of the Reasons as quoted above.  The Presiding Officer to me was not treating the evidence of the name card or the title of Ms Wong as anything of overwhelming weight to “unambiguously” reflect an employment relationship as now submitted by Mr Lung.

(5)    Mr Lung further contends that the Tribunal did not satisfactorily deal with Xie En’s case that all of its employees had a written contract and yet Ms Wong had none.    In my judgment, when paragraphs 21 and 25 of the Reasons are read together and properly, it is clear that The Presiding Officer dealt with this part of Xie En’s case by accepting Ms Wong’s evidence as to why she had not insisted on an employment contract. These parts of the Reasons are as follows:

“21.  被告公司又說，所有被告公司員工都有合約，若果申索人是全職僱員，並無理由申索人並無合約。申索人解釋，申索人初時與謝小姐相交，兩人十分投契，申索人亦是經由中間人好朋友區志明介紹認識謝小姐，謝小姐為人說話很有感染力，所以申索人並沒有著意執著要求一份書面僱傭合約。

…

    25． 小心考慮全部證供以後，本席認為申索人案情合乎情理，比較可信，本席小心考慮全部證供以後，本席信納申索人案情為本案事實認定，舉凡申索人證供與被告公司證人證供有相矛盾的地方，本席信納申索人證供，而並不接納被告公司證人證供。”

(6)    Nothing has been said or shown to suggest that it was wrong in law for the Tribunal to have accepted Ms Wong’s said evidence.  In the premises, Mr Lung’s contention is again unarguable.

20.  For these reasons, I am not persuaded that Xie En’s first intended ground of appeal is arguable.  No leave to appeal should be given under this ground.

C4.  Ground 2:  sufficient evidence on summary dismissal

21.  The arguments under this intended ground of appeal effectively run as follows:

(1)    It is established that if an employee is persistently and habitually late for work, it may justify a summary dismissal under s. 9 of the Employment Ordinance:  Ying Kee Safes & Furniture Ltd v Wong Yam Tak [1996] 1 HKC 307, 310E-311I per Le Pichon J (as she then was).

(2)    There was sufficient evidence to show that Ms Wong had been persistently late in returning to work. 

(3)    As such, the Tribunal erred in law in rejecting a case of summary dismissal on the basis that Ms Wong was “trying her best” to comply with Xie En’s instructions. The Tribunal was wrong because (a) there was no evidence to support that Ms Wong was trying her best, and (b) in any event, even if so, this was irrelevant to the question.

22.  I also do not think there is an arguable chance of success under this intended ground of appeal for the following reasons:

(1)    There was simply no evidence before the Tribunal to show what was the prescribed time of work that Ms Wong had to be complied with.   In fact, it was Ms Wong’s evidence that she was not told of any prescribed time to go work (whose evidence had been accepted by the Tribunal^[5]). 

(2)    Thus, Xie En’s complaint that Ms Wong had been going to work at irregular time of the day (“上班時間不穩定”) per se did not amount to any arguable case of persistent or habitual lateness to work.

(3)    Further, Mr Lung accepts that, even if an employee had been late to work, in order to justify summary dismissal, there should be prior warning given to the employee about the lateness, of which the employee continued to ignore.

(4)    Notwithstanding Mr Lung seeking to point to certain parts of the transcripts of the proceedings, I find no evidence (direct or indirect) at all before the Tribunal to show that any such warning had been given to Ms Wong.

(5)    In the premises, even if there had been evidence to show that Ms Wong had been late to work, Xie En would not have been entitled to summarily dismiss Ms Wong as submitted by Mr Lung. 

(6)    Therefore, in my opinion, Xie En does not stand any arguable chance to succeed on this intended ground of appeal to set aside part of the Award^[6].

D.   Conclusion

23.  For the above reasons, I refuse to grant leave to Xie En to appeal against the Award.

[1] Dated 22 December 2009.

[2] This is Ms Wong’s witness statement (2) filed in support of her claims in the Labour Tribunal.

[3] See paras 14 and 15 of XieEn’s skeleton submissions.

[4] See: paras 23 and 25 of the Reasons. 

[5] See para 25 of the Reasons.

[6] It should further be noted that even if leave were to be granted under this ground, it would only go to part of the Award in relation to Xie En’s liability to make 1 month payment in lieu to Ms Wong.  This would not have affected the part of the Award for outstanding wages.