LUI TIN LUNG v. SUN PO YUEN NOODLE SHOP & CAFé

HCA 9302/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 9302 OF 1999

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REASONS FOR JUDGMENT

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1. The Plaintiff is the former employee of the Defendant, Mr Law Shu Fai trading as Sun Po Yuen Noodle Shop & Café in Yuen Long. In April 1999, the Plaintiff lodged a claim in the Labour Tribunal claiming various sums due to him under his contract of employment which was terminated summarily on 14 February 1999. In May 1999, the Presiding Officer of the Labour Tribunal transferred the Plaintiff's case to the High Court because some of the items claimed by the Plaintiff related to amounts due more than 12 months before the claim was lodged, and the Labour Tribunal did not have jurisdiction at that time to entertain such claims under Section 9 of the Labour Tribunal Ordinance, Cap. 25, which provision has since been repealed. The Plaintiff has been acting in person in these proceedings in the High Court whereas the Defendant is legally represented.

2. The Plaintiff's claim consists of the following items:

(1)	wages in lieu of notice
	The amount claimed is HK$7,466.60, being the wages for 14 days from 15 February 1999 to 28 February 1999.
(2)	arrears of wages
	The amount claimed is HK$8,000.00, being the wages owing for the first half of February 1999.
(3)	annual leave pay
	The amount claimed is HK$7,627.30, being the annual leave pay owing for the period of September 1996 to 14 February 1999.
(4)	end of year payment
	The amount claimed is HK$15,430.10 and this related to the period from January 1998 to February 1999.
(5)	rest day
	The Plaintiff claims that his wages were deducted for 106 rest days during September 1994 to January 1999. The amount he claimed initially was HK$56,533.20 which has been revised to HK$39,733.20, after taking into account the changes in the wages he had received over this 5 year period.
(6)	statutory holiday pay
	The amount claimed is HK$6,899.90 and this related to the amounts owing in 1995, 1996 and 1997.
(7)	terminal payments under Section 32O of the Employment Ordinance, Cap. 57
	The amount claimed is HK$47,547.00 for long service pay.

3. The Defendant admits liability of items (2), (3), (4) and (6). The Defendant does not dispute the calculation of the remaining 3 items but disputes liability to pay them for the following reasons. It is alleged by the Defendant that there was justification in terminating the Plaintiff's employment summarily on 14 February 1999, hence the Defendant is not liable to pay wages in lieu of notice by virtue of Section 9 of Cap. 57 and the Plaintiff is not entitled to terminal payment under Section 32O by reason of Sections 32M and 32K. As for the claim in respect of the rest day, the Defendant's case is that under the terms of the employment agreement, the Plaintiff was not entitled to 4 rest days with pay in a month but was only entitled 2 rest days with pay and 2 rest days without pay during a month. It is denied that the Plaintiff's wages were deducted on account of his taking time off on a rest day.

4. There are thus 2 issues I have to resolve. The first is whether there was justification for the summary dismissal of the Plaintiff on 14 February 1999. The second is the question of the Plaintiff's rest day entitlement under his contract. The background facts may be summarised as follows.

5. The Plaintiff was employed by the Defendant as a cook in the Defendant's noodle shop as from 1 September 1994. He was interviewed by the Defendant that day and was hired right away. There was no written contract. He was the only cook in the shop. The Plaintiff completed a probation period of 3 months and continued to work for the Defendant until the circumstances described below when his employment was summarily terminated.

6. Prior to 1998, the Defendant did not keep a record of the days in a month that his employees went on leave. He started keeping a record sometime in 1998 after he was prosecuted by the Labour Department for failing to give statutory holidays to his employees in 1997. On 17 January 1999, the Plaintiff went to see a doctor at the Tuen Mun Hospital as he was feeling unwell because he had inhaled unclean air at his place of work. He was referred by the doctor to the medical social worker for counselling because he was unhappy about his employment. After receiving advice from the social worker and thinking the matter over for a week, on 26 January 1999, the Plaintiff sent a notice to the Defendant by recorded delivery stating that he was giving 1 month's notice to terminate his employment and that he would work until 28 February 1999. On receiving the Plaintiff's notice, the Defendant sent a notice to the Plaintiff also by recorded delivery on 28 January 1999 acknowledging receipt of it and accepting the Plaintiff's resignation. In the Defendant's notice, it is further stated that the Defendant's company was prepared to give special accommodation to the Plaintiff and he was allowed to terminate his employment early by 15 February 1999 5:30 pm, at which time he would be paid his year end payment and his wages from 1 to 15 February 1999. It was against this background that the incident on 14 February 1999 arose which led to the summary termination of the Plaintiff's employment.

The witnesses

7. Only the Plaintiff and the Defendant gave evidence. Having had the opportunity of observing them and having considered carefully what was said by each of them, I have come to the view that the Plaintiff is a truthful witness. He has struck me as a stubborn character and he would persist in doing things his own way and at times he was quite unable to see the other party's point of view. He could be trying on occasions but I do not think he was evasive in his evidence as submitted by the Defendant's counsel, Mr Dickson Li, when he was cross-examined and pressed for an explanation as to why he had chosen to do certain things in a particular way. As I find, the Plaintiff has a dogged personality. It may be difficult for him to explain why he should persist in doing certain things in a particular manner. I certainly do not attribute any ulterior motive to the way the Plaintiff had acted after he tendered his resignation on 26 January 1999 up to his dismissal on 14 February 1999. I am of the view that he is a simple character. Contrary to the submission of the Defendant's counsel, I think it is a hallmark of the Plaintiff's truthfulness when he said in his cross-examination that he had no recollection of certain things allegedly said by the Defendant to him on 14 February 1999. The Plaintiff accepted that the words put to him might have been said by the Defendant on that day, even though it would be against his interest to admit that the Defendant might have said certain things.

8. I am not able to form a favourable view of the Defendant having heard his evidence. There were various inconsistencies between his testimony in court and the Defence and witness statement filed on his behalf. Also, he had contradicted himself a few times in his evidence. He strikes me as a cleverer person compared to the Plaintiff.

Was the summary dismissal justifiable

9. According to the Plaintiff, after he had received the Defendant's notice on 28 January 1999, he had told the Defendant immediately that he would not accept the Defendant's accommodation of early termination of his employment on 15 February 1999 and he said he would work until 28 February 1999. The Defendant told the Plaintiff he would have to consult his board of directors and he would not be able to give an answer to the Plaintiff right away. Thereafter, up to the day when the Plaintiff was dismissed, the Plaintiff had asked the Defendant everyday for an answer whether he could work up to 28 February 1999.

10. It is pleaded in the Defence that the Plaintiff had made no response to the Defendant's notice whether he would accept the Defendant's accommodation of early termination on 15 February 1999. In the Defendant's witness statement, it is stated that the Defendant was taken by surprise when the Plaintiff spoke to him about this on 14 February 1999. Under cross-examination, the Defendant contradicted his case in his Defence and witness statement and admitted that after receiving the Defendant's notice on 28 January 1999, the Plaintiff had raised it with him "occasionally" if he would be allowed to work up to 28 February 1999.

11. I have no hesitation in rejecting the Defendant's evidence on this and I find that the Plaintiff had, after receiving the Defendant's notice on 28 January 1999, asked the Defendant everyday if he could work up to 28 February 1999 and the Defendant had stalled for an answer. That took matters to a head on 14 February 1999, which was the second last day before the Chinese New Year holidays and the day before 15 February which was the date of early termination as proposed by the Defendant.

12. According to the Plaintiff, he came back from his lunch break on 14 February 1999 and spoke to the Defendant who had taken up the Plaintiff's place in the cooking area and was cooking noodles as someone had to take the Plaintiff's place when the Plaintiff was off for lunch. The cooking area was 3 feet by 6 feet and could only accommodate 1 worker. The Plaintiff asked the Defendant if he could return to work on the fourth day of the Lunar Year and work until 28 February 1999. The Defendant told the Plaintiff he had to wait for the decision of the board of directors and everything would be dealt with in accordance with the Defendant's notice on 28 January 1999. When the Plaintiff persisted in asking the Defendant for an answer if he would be allowed to work up to 28 February 1999, the Defendant became very upset and blew his top. He scolded the Plaintiff and challenged him to a fight. The Defendant next summoned the police and when the police arrived, he told the police that he would not allow the Plaintiff to work there any more. The Plaintiff left the shop and on the advice of the police, he went to consult the Labour Department.

13. On the Defendant's evidence, the Plaintiff picked a busy time in the shop when customers were coming in for lunch to raise the matter if he could work up to 28 February 1999. The Defendant told the Plaintiff the matter should be brought up at close of business that day. The Plaintiff insisted on a reply and when one was not forthcoming from the Defendant, the Plaintiff fetched an order form and wrote on it that his employment was terminated immediately and asked the Defendant to sign the document. The Defendant refused to do so and again said he would discuss the matter with the Plaintiff at the close of business and that he would give the Plaintiff the money due to him on the following day. The Plaintiff said if the Defendant was unable to pay him what was due right away, he would not resume his duty and he refused to go back to work. In those circumstances, the Defendant called the police and in the presence of the police, the Defendant informed the Plaintiff that he would not require the Plaintiff to work there because he was afraid of confrontation with the Plaintiff.

14. It is alleged by the Defendant that the Defendant had made a lawful and reasonable request to the Plaintiff to go back to work and the Plaintiff's refusal to do so amounted to wilful disobedience of a lawful and reasonable order so that the Defendant was entitled to dismiss the Plaintiff summarily under Section 9 of Cap. 57.

15. I do not accept the Defendant's evidence on this. I do not believe that the Plaintiff had picked on an inconvenient time to raise the matter so as to disrupt the business and to exert pressure on the Defendant. That does not accord with my view on the Plaintiff's character and personality. The Defendant had also departed from his witness statement in a material respect. In the witness statement, he said he had told the Plaintiff there and then that even if the Plaintiff was to work until 15 February 1999, the Defendant would pay the Plaintiff wages in lieu of notice for the period between 16 and 28 February 1999. This important matter was not mentioned by the Defendant in his testimony. The Defendant had also contradicted himself in his evidence. In his examination in chief, he said that he did not say words to the effect to terminate the employment with the Plaintiff on 14 February 1999. Under cross-examination, he admitted that after the police had arrived, he had told the Plaintiff that he would not require the Plaintiff to work for him any more in view of what had happened.

16. I accept the Plaintiff's evidence on the incident that day save and except that I do not believe that the Plaintiff had stayed calm throughout and did not raise his voice during the incident as alleged by him. I find what happened that day was that the Plaintiff had asked the Defendant if he could work up to 28 February 1999 and the Defendant answered that everything would be dealt with in accordance with his notice on 28 January. Notwithstanding that the Defendant had answered the Plaintiff's question and the Plaintiff ought to have realised that the Defendant would only allow him to work up to 15 February, the Plaintiff somehow refused to take that for an answer and persisted in asking the Defendant to give him a reply if he could work up to 28 February. I find that it was this dogged attitude of the Plaintiff that had caused the Defendant to lose his temper and that he had challenged the Plaintiff to a fight. When the Plaintiff refused to leave, the Defendant summoned the police. It was in those circumstances that the Plaintiff's employment was terminated, not because the Plaintiff had refused to obey a lawful and reasonable order of the Defendant as alleged.

17. As I find against the Defendant that there was any justification to dismiss the Plaintiff summarily, the Defendant is liable to pay the Plaintiff wages in lieu of notice and the terminal payment under Section 32O of Cap. 57.

The entitlement to rest day

18. Under Section 17 of Cap. 7, it is provided that every employee who has been employed by the same employer under a continuous contract shall be granted not less than 1 rest day in every period of 7 days. In the Plaintiff's case, he should be granted 4 rest days a month. Section 20(2) provides that an employee may, at the request of his employer, work for his employer on a rest day.

19. It is the Plaintiff's case that when he was first employed by the Defendant, it was agreed that he would be entitled to the benefits in accordance with the Employment Ordinance and that he would have 4 rest days a month. His salary would be paid on a monthly basis, with payment to be made on the last day of each month and his salary when he first joined was about HK$7,000.00 a month. His monthly salary at the time of the last increase was HK$16,000.00.

20. However, after the Plaintiff was employed, he was only given 2 rest days a month. He raised the matter with the Defendant in about February 1995. The Defendant told the Plaintiff that as the Plaintiff was the only cook, the Defendant would have to hire a substitute worker if the Plaintiff went on leave. The Defendant promised he would make it up for the Plaintiff at a later stage. He did not explain in what way he was to make it up but the Plaintiff had expected the Defendant to give him compensation in money for the 2 rest days a month that the Plaintiff was asked not to take.

21. The Defendant did not give the Plaintiff any money compensation or allow the Plaintiff to take more than 2 rest days a month. On the occasions that the Plaintiff did take more than 2 rest days a month, the Defendant deducted 2 days' wages from his monthly salary. For the sake of keeping his job, the Plaintiff felt that he had no alternative but to tolerate the situation.

22. In about April 1998, the Plaintiff raised the matter with the Defendant and said he would like to have 4 rest days a month. The Defendant's reply was that the Plaintiff should not make so much trouble, either he was to continue to work there on the Defendant's terms or the Plaintiff could resign from the job. Again, for the sake of keeping his job, the Plaintiff tolerated the situation.

23. After the Defendant was prosecuted in 1998 for failing to give statutory holidays to his employees in 1997, the Defendant began to keep a record of the days on which his employees went on leave and the records relating to the Plaintiff from April 1998 were produced. It is clear from those records that in none of the months from April 1998 to January 1999 was the Plaintiff ever paid a salary of HK$16,000.00. A deduction in the amount of HK$533.30 (i.e. HK$16,000.00÷30) was made in respect of each day that the Plaintiff went on leave if he should take more than 2 rest days in a month, apart from statutory holidays.

24. According to the Defendant, what he had agreed with the Plaintiff at the outset was that the Plaintiff would be given 2 rest days with pay and 2 rest days without pay during a month. He alleged that the Plaintiff's wages were calculated on a daily basis, not on a monthly basis, and that payment would be made at the end of the month. There was no deduction from the Plaintiff's wages as the Plaintiff was not entitled to be paid HK$16,000.00 a month if he should be taking the third and fourth rest days in a month because these 2 rest days were without pay. The Plaintiff would only receive HK$16,000.00 a month if he should work on the third and fourth rest days of a month. The Defendant pointed to the work records from April 1998 onwards to show that the Plaintiff had worked "voluntarily" on the third and fourth rest days in accordance with Section 20(2) of Cap. 57 as the Plaintiff had signed these work records.

25. I do not accept the Defendant's evidence.

26. Firstly, his evidence was inconsistent with his statement to the Labour Tribunal in which he stated that the Plaintiff's wages for the last working month were HK$16,000.00 and that the Plaintiff was entitled to 2 rest days a month, not that he was entitled to 2 rest days with pay and 2 rest days without pay.

27. Secondly, the Defendant gave contradictory evidence regarding the alleged daily wages of the Plaintiff. Initially, he said that the daily wages were HK$500.00 at the time of the last increase and that it was not fixed with reference to the global figure of HK$16,000.00 divided by 30 days. When he was confronted with the wage records from April 1998 which showed that daily wages were calculated at HK$533.30, he changed his evidence.

28. Thirdly, the Defendant admitted in evidence that deductions were made from the Plaintiff's wages of HK$16,000.00 a month if the Plaintiff should take the third and fourth rest days off in a month. I do not think he could have said otherwise as this was clearly shown in the wage records.

29. Fourthly, I do not accept that the Plaintiff's wages were calculated on a daily basis. If this was really the case, it would be very odd for daily wages to be fixed at HK$533.30, instead of at a round figure like HK$500.00 as the Defendant had initially alleged. I find that the Plaintiff's wages were fixed on a monthly basis and that it was at HK$16,000.00.

30. For the above reasons, I find in favour of the Plaintiff that his contractual entitlement was 4 rest days with pay in a month and that the Defendant had acted in breach of contract in not giving him the third and fourth rest days in a month and in deducting his wages if he should go on leave for the third and fourth rest days.

Conclusion

31. I give judgment for the Plaintiff as claimed save that the amount claimed in respect of rest day is revised to HK$39,733.20. The total amount of the 7 items of claim is HK$132,704.10 with interest thereon at the prevailing judgment rate from 28 April 1999, which was the date on which the Plaintiff lodged his claim in the Labour Tribunal. I make an order that the amount of HK$50,000.00 with accrued interest being the amount paid into court by the Defendant on 14 September 1999 be paid out to the Plaintiff in part satisfaction of the judgment debt. I order that the Plaintiff is to have costs of this action which I have assessed at HK$10,000.00 on a gross sum basis in place of taxed costs.