FONG MUNG YAN v. ISS HONG KONG SERVICES LTD

CACV 344/2005 and CACV 406/2005

(Heard Together)

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 344 OF 2005

(ON APPEAL FROM HCLA 56 OF 2003)

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CIVIL APPEAL NO. 406 OF 2005

(ON APPEAL FROM HCLA 56 OF 2003)

______________________

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J U D G M E N T

______________________

Hon Cheung JA :

The proceedings

1. Madame Fong Mung Yan (the representative claimant in CACV 344/2005) and Madame Wong Yin Fong (the representative claimant in CACV 406/2005) together with a large group of claimants in these two appeals were former employees of the defendant.  They claimed that they were constructively dismissed by the defendant as from 1 December 2001.  They lodged claims in the Labour Tribunal against the defendant for, among other things, severance payment, annual leave pay and attendance bonus. 

2. Mr. Winston Leung, the Presiding Officer of the Labour Tribunal, dismissed their claims.  Pursuant to leave the claimants appealed to the Court of First Instance of the High Court.  Lam J dismissed their claim for severance payment but allowed their claim for attendance bonus as arrears of annual leave pay.  Pursuant to leave granted by this Court the claimants appealed against the decision of Lam J in dismissing their claim.  The defendant further obtained leave from this Court to appeal against Lam J’s decision on attendance bonus. 

Facts

3. Before the claimants became employees of the defendant they were employees of a company called Reliance Environmental Services Company Limited (‘Reliance’).  Reliance had contracts with the Mass Transit Railway Corporation (‘MTRC’) since 1979 for the cleaning of the MTR stations.  In 1998 the defendant acquired Reliance and also took over its contract with MTRC.

4. In 2001 the defendant was unable to renew the contract with MTRC which was to be terminated on 30 November 2001. 

5. The defendant, apart from having the contract with MTRC also had cleaning contracts with other entities in various locations in Hong Kong.  In November 2001 the defendant gave notice to the claimants that as from 1 December 2001 they would be redeployed to carry out cleaning work in other locations.  The claimants who had been working at the MTRC railway stations refused to accept the redeployment.  They claimed that the defendant was in repudiation of their contract of employment and that they were constructively dismissed by the defendant as from 1 December 2001.

6. The claimants not having reported for work in December 2001, the defendant informed the claimants that their employment would be terminated as from 15 December 2001. 

Constructive Dismissal

7. The claimants’ case on constructive dismissal was based entirely on their claim that their working hours were from 11 p.m. to sometime after 3:30 a.m. and that as a result of the proposed redeployment they were required to work from 11 p.m. to 7 a.m.  They claimed that the defendant was in repudiation of the contract by requiring them to work longer working hours.

8. The law on constructive dismissal is clear : If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any further performance.  If he does so, then he terminates the contract by reason of the employer’s conduct.  He is constructively dismissed : Western Excavating (E.C.C.) Ltd. v. Sharp [1978] 1 QB 761 per Lord Denning MR.

Terms of employment

9. The claimants were nightshift workers who were responsible for the cleaning of the various stations on the MTR lines.  When the claimants were first employed by Reliance they were required to sign a proforma contract of employment.  In this contract in a box marked ‘exclusive use of unit’ the location of the MTR station was specified against ‘place of work’ and the duration of 11 p.m. to 7 a.m. was also specified against ‘working hours’. 

10. The claimants’ case was that when they joined Reliance the foreman explained to them the rules and regulations and working procedures of the company.  The foreman informed them that although their contract provided that their shift ended at 7 a.m., because of their actual workload which could be completed at approximately 3 a.m., unless the station manager directed otherwise, they could leave at approximately 3:30 a.m.  But one worker had to stay behind on standby.  This practice had not changed for 15 to 20 years.  The worker who was left behind was paid an extra $300 per month.  Initially he was paid by Reliance but after the defendant took over the MTRC contract the co-workers who worked at the stations contributed this sum to the standby worker.

11. The Presiding Officer found that the working hours of the claimants were from 11 p.m. to 7 a.m.  He held that

‘

On the whole, I take the view that the message that the workers received upon joining the company was that “in normal circumstances work finishes at 3.30 a.m.”, and not “under the employment contract, work finishes at 3.30 a.m.” - the former is a statement of fact, the latter is an interpretation of the contract.’

12. This finding was upheld by Lam J.  He held that (para. 67)

‘

In my judgment, the most that one can say about the special arrangement was a special indulgence or forbearance on the part of the Defendant: so long as the Claimants were working at the MTR stations and they could complete the work accordingly with satisfactory arrangement for a standby worker in place, the Defendant could not complain if the workers went off duty from these posts around 3:30 am.  However, it would be going beyond the legitimate limit of the special arrangement to suggest that the Claimants could not be transferred to another post which required him or her to work beyond 3:30 am.  The contractual working hours remained from 11:00 pm to 7:00 am.’

The basis of the lower courts’ decision

13. Both the Presiding Officer and Lam J made their decision by reference to the terms of Reliance’s (and the defendant’s) contract with MTRC and the contribution by the claimants towards the standby worker who remained at the station until 7 a.m.

Ms Eu, S.C.’s argument

14. Ms Eu, SC who appeared together with Mr. Maurice Chan as counsel for the claimants, argued that the Presiding Officer and Lam J were wrong in holding that the working hours of the claimants were from 11 p.m. to 7 a.m.  She submitted this was because the claimants had, despite the terms of the written contract, been told that their work finished at about 3:30 a.m.

Collateral contract

15. One of Ms Eu’s arguments (although not her primary case) was collateral contract.  In J Evans & Son (Portsmouth) Ltd. v. Andrea Merzario Ltd [1976] 1 WLR 1078 Lord Denning at page 1081 stated that :

‘

When a person gives a promise or an assurance to another, intending that he should act on it by entering into a contract, and he does act on it by entering into the contract, we hold that it is binding: see Dick Bentley Productions Ltd. v. Harold Smith (Motors) Ltd. [1965] 1 W.L.R. 623.  That case was concerned with a representation of fact, but it applies also to promises as to the future.’

Construction of agreement

16. Ms Eu, SC also advanced her case by way of construction of the terms of the agreement between the claimants and their employer. 

17. Roskill LJ in J Evans & Son after referring to the contract which was partly in writing, partly oral and partly by conduct stated that

‘

In such a case the court does not require to have recourse to lawyer’s devices such as collateral oral warranty in order to seek to adduce evidence which would not otherwise be admissible.  The court is entitled to look at and should look at all the evidence from start to finish in order to see what the bargain was that was struck between the parties.’

No ground for intervention  

18. Despite the criticism in Chitty on Contracts 29^th Ed Vol 1, para 2-181 the principles set out in J Evans & Son are well recognized principles.  However, on the facts of this case the courts below were clearly entitled to take into account the two factors I have earlier stated in determining the exact terms of the agreement.  I am not prepared to say that they had taken into account irrelevant matters or had ignored some very important considerations which entitle this Court to intervene and make a fresh finding on the terms of the agreement. 

Reliance’s own contract with MTRC

19. The working hours as specified in the contract and what the workers were told by the foreman were, of course, factors to be taken into account in deciding what were the actual working hours of the claimants.  But at the same time the employer’s cleaning contract with MTRC and the fact that one worker was to stay until 7 a.m. were also clearly relevant.

20. Amongst the documents produced by the defendant was a MTRC ‘Tender General Specification for Cleaning Service Contract’.  Under Clause 5.3 it was stated that the working hours for all service personnel, i.e. supervisors, foremen and cleaners shall be divided into three shifts :

5.3.1	Early Shift	-	Hours 0700 to 1700
5.3.2	Late shift	-	Hours 1700 to 2300
5.3.3	Night Shift	-	Hours 2300 to 0700

21. The Presiding Officer held that because of this provision the defendant would not be able to satisfy its contractual obligations towards MTRC if it agreed to hire workers who only worked for three or four hours instead of the eight-hour shift.  He held that the stand taken by MTRC to allow the workers to leave early when the cleaning work was done was understandable because the station managers were unwilling to supervise a group of workers who would be loitering on the platforms with nothing to do.  He further held that MTRC however did not completely abandon the contractual right to require the workers to provide cleaning services for eight hours and that was the reason why MTRC required one worker to stay behind as a standby. 

22. Ms Eu, SC argued that there was no evidence from MTRC as to what it had actually agreed with Reliance or the defendant.  She further argued that MTRC might have waived its contractual requirement with Reliance or the defendant. 

23. The starting point is, of course, that the contract with MTRC was part of the factual matrix in which the court was to determine the duration of the working hours of the claimants.  While there might not be evidence from MTRC, the terms of the MTRC contract which specified the night shift hours and the requirement that one of the workers was to stay behind until 7 a.m. were clearly factors upon which the Presiding Officer could draw the inference that MTRC had maintained its contractual right to require the workers to provide cleaning service for eight hours.

24. At this stage of the proceedings it clearly is not permissible for us to disturb this finding and come to another finding of fact that MTRC might well have waived this contractual requirement. 

Relevance of wage

25. In criticizing the Presiding Officer’s reliance on the MTRC contract, Ms Eu, SC further relied on the failure by Reliance and the defendant in complying with the MTRC’s specification that they must ensure that the ‘fair wages’ i.e. take-home pay quoted in the tender shall be given to the claimants.  The take-home pay quoted by Reliance in the tender documents of $4,300 for the night shift workers was much higher than the actual wages received by the claimants.

26. This issue was not explored at the Labour Tribunal.  This was probably due to the fact that the claimants were not aware of the wage in the tender documents because the Presiding Officer did not release these documents to the claimants.  However, I agree with the view of Lam J that given the workers’ funding for the special arrangement, even if the deviations from minimum wage levels were taken into account the Presiding Officer’s conclusion on the effect of the statements by the foreman was plainly right.

27. As to the argument that the workers might agree to accept a lower salary in return for working a shorter shift, again this matter was not fully explored in evidence.  Although at the Labour Tribunal a representative of the labour union suggested that the workers were willing to work at a lower wage because of the shorter working hours, that was not really borne out by the evidence adduced by the claimants.

Contribution by the claimants

28. The other reason given by the Presiding Officer for rejecting the claimants’ contention was the contribution by the claimants towards the extra pay of $300 to the standby worker.  The circumstances in which the workers agreed to be responsible for this sum was also not explored in cross-examination.  Ms Eu, SC argued that this may well be because the claimants did not wish to take any kind of class action against the defendant for refusing to pay this sum.  The reason for the claimants’ contributions was not explored in the Labour Tribunal.  The larger picture is that it would be most unusual for workers who received pay for their work to make contribution to a co-worker.  From this, the lower courts were justified in finding that the shorter working hours was an indulgence and not a contractual term. 

Re-deployment of the claimants

29. In my view, even if Ms Eu, SC was correct in her construction of the terms of the agreement, it still does not mean that the claimants were entitled to succeed.  This is because the whole of the contract terms has to be considered.  In this particular case one of the most significant terms of the contract is the right of the employer to redeploy the workers. 

30. The claimants’ contract with Reliance and the defendant contained a redeployment clause, namely :

‘	1.9	Relocation: (Reliance Contract) as and when the company deems necessary, employees should accept reasonable relocations by the company, including relocations to a new work place or to a new position.  Employees who refuse to accept such relocation arrangements shall be treated as having voluntarily resigned and shall not have a claim for compensation against the company.
	1.9	Relocation: (ISS Contract) the company has the right to re-locate workers to an alternative work unit or position as actual circumstances require.  Employees who refuse to accept such relocation arrangements shall be treated as having voluntarily resigned and shall not have a claim for compensation against the company.’

31. It was not suggested that Reliance only had the MTRC contract and no other contracts for which they could redeploy the workers to other workplaces.  Certainly as far as the defendant was concerned it had other cleaning contracts and would be able to redeploy the workers from one place to the other.  Ms Eu, SC properly accepted that the defendant had the right to redeploy the workers but argued that the right of redeployment must be subject to the workers working the same hours of shift as at the MTR stations, namely only until 3:30 a.m.

32. Before Lam J it was argued by the claimants that the redeployment clause was void.  This was rejected by Lam J.  Although the question of redeployment was initially one of the grounds of appeal relied upon by the claimants it was (and in my view very properly) abandoned at this appeal. 

33. In my view once it is accepted that the defendant had the right to redeploy the claimants then their case on the shorter working hours breaks down.  The shorter working hours of the claimants although for a very substantial period of time of 15 to 20 years would (at best) only be available to them if they continued to work at the MTR stations.  It would unduly restrict the redeployment right to say that in such a situation (e.g. redeployment to a hospital) the defendant must still observe the shorter working hours.  I see no reason why the right should be so restrictive when the ambit of the redeployment right does not call for such a restriction. 

Procedural irregularity

34. While the defendant had disclosed the documents relating to the MTRC contract the Presiding Officer at the request of the defendant refused to release certain of these documents to the claimants.  This was done on the basis that these documents contained sensitive information.  The decision was clearly incorrect because except in very unusual circumstances a party should not be faced with having to deal with evidence which it is not permitted to see.  There were no such unusual circumstances in this case. 

35. Lam J rightly disagreed with the approach of the Presiding Officer.  Lam J released the withheld documents to the claimants’ legal representatives for inspection and according to the judgment of Lam J, the then senior counsel for the claimants contended that the withheld documents could assist the claimants in the following aspects of the case :

(1)	to establish that the salaries of the nightshift workers were lower than the minimum wages the Defendant promised the MTRC in the tender documents;
(2)	to establish the lack of genuine need for so many workers at the designated new posts; and
(3)	these documents might also affect the Presiding Officer’s assessment of the credibility of the Defendant’s representatives.

36. Lam J considered these grounds.  He held that,

(1)	given the workers’ funding for the special arrangement, even if the deviations from minimum wage levels were taken into account the Presiding Officer’s conclusion on the effect of the statements by the foreman was plainly right.
(2)	given the termination of the MTRC contract, the inevitable time taken for absorbing the claimants and the willingness of the defendant to pay the same salaries and travelling expenses to the claimants, whether there was an immediate genuine operational need to have so many workers at the designated new posts was not important.
(3)	given the need to redeploy the claimants as a result of the defendant losing the MTRC contract and other relevant factors, the claimants could not establish any breach of duty by the defendant to sustain a case of constructive dismissal even if they could cross-examine the defendant’s representative with the benefit of the withheld documents.

37. At the end Lam J held that there was no substantial miscarriage of justice by reason of the withholding of the documents from the claimants.  I agree with Lam J’s view.

Claimants’ appeal dismissed

38. The appeal is accordingly dismissed.  Ms Eu, SC has most persuasively advanced the case for the claimants.  I have sympathy for the claimants who for a substantial period of time were required only to work for much shorter working hours.  However at the end of the day this Court is constrained by the concurrent findings of fact by the courts below and I really cannot see any substantial error which would enable an appellate court to intervene at this late stage or to make a new set of findings.  I note that many of the claimants have since joined the new contractor who won the cleaning contract from MTRC in place of the defendant.   

Cross appeal : Attendance Bonus

39. Lam J allowed the claimants’ appeal against the Presiding Officer’s refusal to allow their claim on attendance bonus.  Although the written contract did not provide for attendance bonus, Reliance and the defendant had been paying attendance bonus to the workers since 1979 and the practice was that the bonus would be paid on the month if the worker had not been absent from work including absent on account of taking annual leave. 

40. The claimants sought reimbursement of the attendance bonus which was withheld by the defendant when they took their annual leave by seeking repayment of the amount of the wages that had been deducted on account of the attendance bonus for six years.  Lam J allowed the claim on the basis that they were arrears of annual leave pay as opposed to arrears of wages.  In my view the judge was correct to allow this claim.

Section 2(1) of the Employment Ordinance

41. Section 2(1) of the Employment Ordinance (Cap. 57) (‘the Ordinance’) defines wages as meaning all remuneration, earnings, allowance including attendance bonus ‘however designated or calculated, capable of being expressed in terms of money, payable to an employee in respect of work done or to be done under his contract of employment…..’.  (emphasis added)

42. In my view this Court is bound by its earlier decision in Wong Ping-kong and others v. Tai Hing Cotton Mill Limited [1994] 2 HKLR 107 in which the defendant company paid its employees an attendance bonus, equal to a percentage of their basic wage, if they attended at the place of work on every day of the wage period except Sundays.  The employer dismissed the employees and the question arose whether their severance pay calculation should include the attendance bonus. 

43. This Court (Mortimer JA, Keith J (as he then was) and Leonard J) held that attendance bonus comes within the meaning of wages in section 2(1) of the Ordinance.  This Court held that,

‘

If he (i.e. the employee) attended at his place of work regularly, he qualified for a higher rate of pay for the work he had done.  The higher rate of pay for the work he had done to which his regular attendance at his place of work entitled him was reflected in the attendance bonus.  His regular attendance at his place of work, in other words, was one of the factors which determined the amount of his pay for the work he had done in the wage period, and the attendance bonus was the component in his pay for the work he had done which was attributable to his regular attendance at his place of work.’

44. I entirely agree with the reasoning.  The attendance bonus was a component of the claimants’ pay.  I see no reason why this Court should depart from its earlier decision. 

Section 41C(1)

45. Further, under section 41C(1) of the Ordinance annual leave pay for workers with fixed salary is defined as a sum ‘equivalent to the wages which the employee would have earned if he had worked every day during the period of annual leave’.  If in a particular month a worker had worked during the annual leave period and had also worked for the rest of the month then he was entitled to his salary plus the attendance bonus.

46. By reason of section 41C(1) it makes no difference if in a particular month he did not actually work during his annual leave but had worked for the rest of the month because his annual leave pay would be equivalent to the wage he would have earned had he worked.  This must include the attendance bonus. 

Purpose of attendance bonus and section 42

47. Mr. Huggins SC submitted that the purpose of the attendance bonus is not to discourage the workers from taking holidays or annual leave but rather was given for the purpose of maintaining an efficient roster system by the defendant.  He submitted that by virtue of section 42 which provides that ‘where pursuant to the terms of his contract of employment or the terms of any other agreement or for any other reason, an employee is paid his ordinary wages in respect of any ….… annual leave …... the employee shall not, in addition to such ordinary wages, be entitled to be paid …... annual leave pay …....’, the claimants were not entitled to the bonus because they were paid the ordinary wages. 

48. It should be pointed out that although section 42 was deleted by Ordinance No. 7 of 2007 which came into effect on 13 July 2007 the deletion has no effect on the rights of the parties whose rights had by then accrued prior to the deletion of this section. 

49. In my view section 42 does not assist the defendant.  This section merely prevents the worker from receiving a double benefit.  It provides no answer to the question whether wages include attendance bonus.  In my view there is no distinction between the term ‘wages’ as defined by section 2(1) and ‘ordinary wages’ referred to in section 42. 

Legally impossible to award attendance bonus?

50. Mr. Huggins SC submitted that the attendance bonus arrangement which required the worker to attend throughout any given month and not take any leave in order to make that bonus payable, would be rendered legally impossible because section 41C(1) would be applied to effectively override that requirement.  In my view there is nothing inherently objectionable about this if ultimately the issue boils down to a construction of the meaning of wages and annual leave as defined by the Ordinance. 

Other provisions

51. In my view it is not necessary to go into overriding provisions in the Ordinance such as section 70 which renders any term of a contract of employment which purports to extinguish or reduce any right, benefit or protection conferred upon the employee by the Ordinance to be void or section 21 which renders any condition in such a contract which makes the payment of annual bonus, or any end of year payment or any proportion thereof subject to working on rest days granted by Part IV of the Ordinance to be void.  As I said earlier the issue is simply one of construction of the terms of the Ordinance. 

Lisbeth Enterprises Limited v. Mandy Luk

52. Wong Ping-kong and Lam J’s decision in the first instance on section 41C were referred to by the Court of Final Appeal in Lisbeth Enterprises Limited v. Mandy Luk [2006] 9 HKCFAR 132.  In my view the Court of Final Appeal not only has not disapproved of these two cases but has actually approved them. 

53. Accordingly I shall dismiss the counterclaim. 

Leave to appeal

54. The claimants obtained leave to appeal on points of law of public importance in respect of the hours of work and the employer’s right of redeployment.  It is not necessary for me to deal with the question of whether as a result of the claimants putting forward entirely new grounds of appeal in respect of the hours of work issue and abandoning the right of redeployment issue the basis upon which leave was granted was somehow affected.  The respondent did not raise any objection on the matter and the issue was only raised at a late stage of the hearing by which time the merits of the appeal have been canvassed by both parties.

Conclusion

55. Both the claimants’ appeal and the defendant’s cross appeal are dismissed.  As the time taken for the appeal was mainly concentrated on the issue of constructive dismissal I would make an order nisi that the defendant is entitled to three quarters of the costs of the appeal.  The claimants’ own costs are to be taxed in accordance with Legal Aid Regulations.

Hon Yeung JA :

56. I have the advantage of the reading the draft judgment of Cheung JA.  I agree with his conclusion and his reasons on the substantive merits of the appeal and the cross appeal.  I also agree with his costs order.  However, I have the following observations to make on the procedural aspects of the case.

57. On 28 June 2005, Lam J dismissed Madam Fong’s appeal on the issue of constructive dismissal but allowed her appeal on the issue of attendance bonus.  By another judgment dated 22 August 2005, Lam J extended his decisions to Madam Wong’s appeal, which involved identical issues.

58. On 12 October 2005 and 15 December 2005 respectively, Madams Fong and Wong obtained ex parte leave to appeal against Lam J’s decisions relating to the constructive dismissal issue on eleven identical grounds as set out in their respective Notices of Appeal.

59. Madams Fong and Wong claimed that those grounds involved a question of law of general public importance.

60. The defendant, in filing a Respondent’s Notice, purported to cross appeal Lam J’s decision on the attendance bonus issue without first seeking leave to do so and without suggesting that the cross appeal involved a question of law of general public importance.

61. By Supplemental Notices of Appeal both dated 4 June 2006, Madams Fong and Wong abandoned all their original grounds of appeal and in substitution thereof seven completely new grounds, settled by Senior Counsel, as follows: -

1.		Based on the undisputed evidence that:
	(a)	all nightshift workers were upon their engagement by the foreman representing Reliance Services Co Ltd (“Reliance”), the Defendant’s predecessor in respect of the contracts of employment, told of a “special arrangement” that all the nightshift workers could go off duty at 3:30 a.m. provided one of them in each station would stay behind until 7 a.m. and be paid an extra allowance of $300;
	(b)	the nightshift workers relied and acted upon such representation when taking up and continuing in the employment;
	(c)	the special arrangement had continued for 15 to 20 years and was the consistent course of dealings between the parties;
	the Learned Judge erred in law in failing to find that it was a term of the contract of employment that the nightshift workers could go off duty at 3:30 a.m.
2.	The Learned Judge’s findings, namely “it was quite clear that neither party regarded this (special) arrangement as contractual in nature” ... or “the special arrangement was a special indulgence or forbearance on the part of the Defendants”…were erroneous, perverse or against the weight of the evidence:
	(a)	The claimants adduced evidence to the effect that they acted on the special arrangement and it was regarded by them to be binding, hence they claimed constructive dismissal when the Defendant transferred them to other workplaces which required working till 7 a.m.;
	(b)	The Defendant did not adduce evidence to contradict the claimants’ said evidence;
	(c)	The special arrangement had lasted some 15 to 20 years;
	(d)	Apart from the nightshift workers who stayed behind on payment of extra allowance, all other nightshift workers went off duty at 3:30 a.m.;
	(e)	There was no evidence that, during the entire period of 15 to 20 years, the nightshift workers who went off duty at 3:30 a.m. were ever required to return to or to stay behind at the workplace until 7 a.m. whether on account of necessity or otherwise;
	(f)	There was no evidence that any of the nightshift workers were ever told by the foreman of Reliance or otherwise that the special arrangement was only temporary or only for such time until they were transferred to some other workplace.
3.	In making the above findings, the Learned Judge erred in placing reliance upon the terms in the contract between MTRC and the Defendant as to the working hours for the nightshift workers (which the Learned Judge regarded as part of the factual matrix)...but not the terms in the same contract as to the fair wages or the take home pay for the nightshift workers, when the length of the working hours was clearly related to the amount of fair wages.
4.	The Learned Judge erred in placing heavy reliance on the fact that the nightshift workers who went off duty at 3:30 a.m. chipped in to pay the extra allowance to the nightshift worker who stayed behind until 7 a.m. as the clearest indication that the nightshift workers did not regard the special arrangement to be contractual in nature:
	(a)	The Learned Judge failed to have regard to the fact that prior to the Defendant taking over Reliance in 1998, Reliance used to pay the extra allowance.  Thereafter, there was a unilateral variation by the Defendant which variation was acquiesced to by the nightshift workers as stated above;
	(b)	The said variation was not inconsistent with the special arrangement (as originally agreed or subsequently varied) being part of the contractual arrangement).
5.	The Learned Judge erred in placing any reliance upon the postulation as to what would happen if none of the workers agreed to stay behind...Such postulation was speculative and never put to the claimants and in any event never happened.
6.	The Learned Judge failed to have regard to the factor material to the length of the contractual working hours, namely the actual wages received by the nightshift workers, which wages was:
	(a)	Below the fair wages or take home pay as stipulated in the tender, which tender was incorporated as part of the contract between MTRC and the Defendant;
	(b)	Comparatively or proportionately less than the dayshift workers;
	(c)	Significantly less than the average wages as provided by the Census and Statistics for the material period.
7.	Whilst correctly finding that was a procedural irregularity in the Tribunal’s withholding of the contractual documents between MTRC and the Defendant...the Learned Judge erred in finding that the same was immaterial even though the withheld documents were directly relevant to the grounds as stated in paragraphs 3 and 6(a), (b) above.

62. Madams Fong and Wong did not assert that the new grounds involved a question of law, let alone one of general public importance.

63. Leave had not been sought to argue any of those new grounds, and the defendant had not raised any objection to the way in which Madams Fong and Wong conducted their appeals.

64. I have set out in detail Madams Fong and Wong’s substituted grounds of appeal to demonstrate that those grounds, in my view, could not possibly involve any question of law of general public importance.

65. Indeed, Ms Eu SC’s argument primarily rested on the suggestion that the Presiding Officer and Lam J were wrong in finding that the working hours of the claimants were from 11 p.m. to 7 a.m.; and one can hardly think of a more factually based argument.

66. Clearly the parties were treating the case as if it was just another civil appeal from the High Court and in so doing were completely oblivious to the clear provisions of the Labour Tribunal Ordinance Cap 25.

67. Because of the manner in which the parties conducted the appeal, every possible issue on facts was opened in the course of the hearing to the extent that this court was led through the transcripts of the hearing before the Presiding Officer with a view to demonstrate that facts found were not supported by evidence or by sufficient evidence.

68. On reflection and speaking personally, I am of the view that the appeal and the cross appeal should not have been conducted or allowed to be conducted in the manner as they did although leave was granted to the defendant to argue his cross-appeal in the course of the hearing.

69. It is important to bear in mind that employment disputes should be resolved quickly and inexpensively, and the Legislature has conferred exclusive jurisdiction to the Labour Tribunal to make finding of facts in accordance with the stipulated procedures. As Bokhary JA (as he then was) commented in Amie M Camacho & Another v Chung Yee-Fong, Helen CACV 215/1996 at p 5 of the judgment:

“

The Labour Tribunal was set up to provide a particularly speedy and inexpensive forum for disposing of labour disputes.  Conciliation is made an objective.  Failing that, hearing before the tribunal are conducted in an informal manner.  There is a strong inquisitorial element in how the tribunal goes about its business. Legal representation is not allowed.  And the rules of evidence do not apply.”

70. The Court of First Instance is only empowered to deal with Labour Tribunal appeals on the grounds that the decision of the Labour Tribunal is (a) erroneous in point of law; or (b) outside the jurisdiction of the tribunal (s 32 of the Labour Tribunal).  Leave to appeal must be obtained on one of those grounds and without permission, an appellant is not entitled to rely on any ground of appeal not specified in the application for leave [Rule 9 Labour Tribunal (General Rules)].

71. The Court of First Instance does not have power to make findings of fact or to reverse or vary the tribunal’s determinations of facts (s 35(2) of the Labour Tribunal Ordinance).

72. The Court of Appeal’s jurisdiction, in dealing with Labour Tribunal appeals, is even more restricted as reflected in ss 32, 35(2) and the following sections of the Labour Tribunal Ordinance Cap 25:

35A.	Appeal to Court of Appeal
	(1)	If any party is dissatisfied with a decision of the Court of First Instance on an appeal heard by leave given under section 22, such party may, within 7 days after the date of the decision, apply to the Court of Appeal for leave to appeal and, if the Court of Appeal considers that a question of law of general public importance is involved, it may grant leave...
	(2)	A refusal by the Court of Appeal to grant leave to appeal shall be final.
35B.	Powers of the Court of Appeal on appeal
	On an appeal for which it has granted leave under section 35A, the Court of Appeal may ─
	(a)	allow the appeal;
	(b)	dismiss the appeal; or
	(c)	remit the matter to the tribunal with such direction as it thinks fit, which may include a direction to the tribunal for a new hearing.

73. Ms Eu pointed out the absence in s 35A of the “otherwise” provision as in section 22 of the Hong Kong Court of Final Appeal Ordinance Cap 484 and suggested that the Court of Appeal, in dealing with Labour Tribunal appeals, has a wider discretion.

74. I do not agree with Ms Eu’s submission.  The absence of the “otherwise” provision means that the power of the Court of Appeal, in dealing with Labour Tribunal appeals, is more restricted.  It is certainly not open to the Court of Appeal to make findings of facts contrary to those made by the tribunal.  The Court of Appeal should not deal with any point of law not canvassed by the Court of First Instance.

75. The object and intention of s 35A of the Labour Tribunal Ordinance are plain and the court must give them effect. 

76. Any party dissatisfied with a decision of the Court of First Instance may apply to the Court of Appeal for leave to appeal.  The Court of Appeal can only grant leave if the appeal involves a question of law of general public importance.

77. In granting leave, the Court of Appeal should specify the question of law of general public importance involved.

78. At the appeal proper, parties are only entitled to argue the question of law of general public importance for which leave has been granted under s 35A and not otherwise.

79. Any departure from the aforesaid procedure would be repugnant to the clear wordings of s 35A of the Labour Tribunal Ordinance and contrary to good sense.

80. I would have dismissed both the appeal and the cross appeal on procedural irregularities.

81. Regrettably, this is one of those cases where the parties’ legal representatives have overlooked clear legislative provisions, leading to a waste of the court’s time and possibly public funds as Madams Fong and Wong are both legally aided.

Hon Yuen JA :

82. I have had the benefit of reading in draft the judgments of Cheung JA and Yeung JA and agree with both.  I also agree that the Respondents should have three quarters of the costs of the appeal.