YING SHU NANG v. THE MUTUAL AID COMMITTEE OF CORAL COURT BLOCK A

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

LABOUR TRIBUNAL APPEAL NO. 11 OF 1996
(CLAIM NO. E4544/95)

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J U D G M E N T

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The appeal

1. The Appellant employee ("the employee") was employed by the Respondent employer ("the employer") as a driver. His contract of employment commenced from 1st June 1994 although the written contract was dated 6th June 1994. On 6th June 1995, his employment was terminated by the employer. He sought one month wage in lieu of notice of termination from the employer in the Labour Tribunal. His application was refused and he now appeals.

The employee's case

2. The employee's case was that since he had taken up his employment, the employer had not allowed him to take any of the statutory holidays which he was entitled to. On 2nd June 1995 he took the Tuen Ng statutory holiday leave and on 6th June, he took the rest of his statutory holidays. He was then dismissed by the employer.

Section 40A(1)

3. The employer said that notwithstanding the employee had not taken any statutory holiday, he was in fact paid wages in lieu of the holidays. It is clear from s.40A(1) of the Employment Ordinance that no payment of holiday pay shall be made in lieu of a holiday prescribed by s.39.

The Decision

4. Although the learned Presiding Officer did not expressly deal with the matter, it is apparent from the Decision that he accepted that the employee had not taken his statutory holidays. His view was that the refusal by the employer to grant statutory holidays to the employee amounted to a repudiatory breach of the contract. The employee, however, had not accepted the breach as he was entitled to, but continued with the employment.

5. The learned Presiding Officer held that the employee could not rely on the employer's refusal to grant him statutory holidays to support his contention that he was entitled to take leave despite disapproval by the employer. As the employee had taken leave without approval from the employer, the learned Presiding Officer found that the employer was entitled to dismiss him summarily.

Conclusion erred

6. In my view, the learned Presiding Officer erred in his conclusion that the employer was entitled to summarily dismiss the employee.

7. Under s.39(1), the employer shall grant the employee the statutory holidays. Under s.39(2), the employer may instead of granting an employee a holiday on a statutory holiday, grant the employee a holiday on another day if notice had been given to the employee in advance. In s.39(3) the employer and employee may agree that another day shall be substituted for the statutory holiday.

8. In the present case, the employer had not granted either the statutory holidays or the alternative holidays. There was also no agreement between the employer and the employee on alternative holidays. There is a penalty imposed under s.63(4) for an employer refusing to grant statutory holiday without reasonable excuse. If s.40A(1) says that you cannot have payment in lieu of holiday, then it cannot be said that the employee had waived his statutory holidays by carrying on work. On the contrary, the employee had requested to take the statutory holidays and in my view the employer could only succeed in its defence if it is shown that it was reasonable to refuse to let the employee take the statutory holidays which, afterall, the employee was entitled to. The burden must be with the employer. All that the evidence shown was that Mr Peter Leung of the employer had refused the employee's request. No explanation was given for the refusal. Mr Leung was not a witness at the hearing because he could not be found. The employer's representative said that the employer intended to give the employee leave in August 1995. The employee's response is at page 87 of the Appeals Bundle in which he said:

"In August 94, Peter Leung, it's annual car inspection, he requested me to take advance leave, I agreed. But after one day leave, he told me he had hired another van, asked me to work the following day, therefore I worked again after one day leave. No one told me about annual leave in August 95 when car was for annual car inspection."

9. The learned Presiding Officer did not disbelieve him. In the absence of such evidence from the employer, how could it be said that - and I paraphrase the words of Lord Evershed M.R. in Laws v. London Chronicle (Indicator Newspapers) Ltd. [1959] 1 WLR 698 - the conduct of the employee was such that he had disregarded the essential conditions of the contract of service which justified summary dismissal by the employer?

10. There was a reference in the Decision to the seven day leave taken by the employee on 6th June 1995. The learned Presiding Officer, however, did not make any finding that the leave he took was his annual leave and not the statutory holidays. In fact the hearing proceeded on the basis of the employee taking the statutory holidays and the Decision was given on that basis.

11. In the circumstances, the appeal is allowed. The employee is entitled to the sum of $6,300 and costs of this appeal.

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