CHAN MEI YING AND OTHERS v. YICK FUNG GARMENT FACTORY LTD

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J U D G M E N T

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1. This is an appeal from a decision of Mrs. G. Chan, a Presiding Officer of the Labour Tribunal. It concerns the question of whether the claimants in this matter, who are perment workers, are entitled to severance pay pursuant to section 31B of the Employment Ordinance, Chapter 57.

2. To come within that section, they must prove they have either been dismissed by reason of redundeney, which is not relevant here, or they have been "laid-off" within the meaning of section 31E of the Ordinance. That section reads:-

"Where an employee is employed under a contract on such terms and conditions that his remuneration thereunder depends on his being provided by the employer with work of the hind he is employed to do, he shall for the purposes of section 31B(1) be taken to be laid off where the employer does not provide such work for him on at least a total of 12 normal working days in any period of 4 consecutive weeks and whereby he is not entitled to any remuneration under the contract for such period.

Where is a provisio which does not concern us.

3. Clearly, and I accept Mr. Smith's submission on this, the section provides for the position of worker's paid at piece rates which of course is extremely common in the garment industry. It means that if work is not available on any 12 working days within a period of 4 consecutive weeks and he is therefore not entitled to be paid, a worker may claim to be laid-off and then claim severance pay pursuant to section 31B of the Ordinance.

4. At the hearing before the Labour Tribunal it was not in dispute that the claimants were piece-workers, and that for Me period of 12 working days within at period of 4 consecutive weeks in 1985/86 the, were not so provided with work. This appeal, however, turns entirely on evidence given by the employer that an offer mad been made to the claimants in 1980, when a similar situation arose, to pay 12 days normal earnings whether work was available or not. Such an offer, if made, would clearly be an attempt, and a perfectly legitimate attempt, to avoid the consequences of the workers being able to claim that they were 'laid-off'. It was was not disputed that an offer was made in 1980 but the workers said, was for a flat $50 a day, not for payment of norm al as claimed by the defendant.

5. The Presiding Officer found firstly that the offer was to pay a flat $50 a day and secondly that the offer, contrary to the submission made by the defendant, was not still open in 1985/86. Accordingly, the workers has been laid off within the meaning of Section 31E. There was no finding, and I fully understand the reason for that, as to whether $50 a day in 1980 was a reasonable sum because I do not think that there was any requirement for such a finding. They question is whether, in 1985 and 1986 when the resent dispute arose, because Cain there was insufficient work (for whatever reason does not concern us, although there was a finding that was due to the employer having opened a factory or factories in China), the offer made in 1980 was still open.

6. Mr. Smith for the defendant, in his succinct and careful , arguments, submitted that quite clearly the offer was made because of the presence of section 31E here was an employer making an offer in order to avoid the liability under that section and accordingly the offer must be considered to be open because the section is and was at all times in force. It was an ongoing situation.

7. Mr. Chan, for the 3rd claimant says that clearly the 1980 offer had lapsed It would be quite unreasonable to expect workers now to accept an offer made in 1980 which may or may not have been reasonable when but was rejected. That was an end to it. It could not be revived unless a new offer of the same amount was again made. Where was no such vidence. Looking at all the surrounding circumstances, the Presiding Officer was quite right to conclude that no offer was available for acceptance by the in 1985/86. Even if it was the fact remains that they did not accept it.

8. Mr. Smith says further that the court should also look at the question of causation. What was the cause of these workers not, receiving their payments? The cause, and therefore "whereby" they did not become entitle to remuneration under the contract was their refusal to accept the offer.

9. Mr. Smith accepts, as he must, that the Presiding Officer's decision as to fact can't be reversed by this Court. Section 35(2)(1) of the Labour Tribunal Ordinance, Cap. 25 provides, inter alia, that:-

"35(1)    On an appeal under Section 32 the High Court may:

(b)    make such order as to costs and expenses as it thinks fit but may not -

(1)     reverse or vary any determinations made by the tribunal on questions of fact."

10. The finding that the offer merle in 1980 was not to pay 12 normal days wages but was to pay $50 a day for 12 days is clearly finding of fact. It is argued that the finding that the offer was not still open is a finding of law and can be challenged. Looking at the whole circunstunces behind the 1980 offer, including in particular the reason for it,  the normal rule an offer once rejected lapses, did not apply. In Penn v. Simmonds⁽¹⁾, Lord Wilberforce said:-

"In my opinion, then, evidence of negotiations or of the parties intentions ........ ought not to be received and evidence should be restricted to evidence of the factual background know to the parties at or before the date of the contract, including evidence , of the 'genesis' and objectively the 'aim' of the transaction."

11. An offer can be accepted at any Lime before it is either withdrawm or the time stipulated for is acceptance has lapsed, where not such time has been shipulated it will be a reasonable time. Remsgate Victoria Hotel Co.v. Montefiore⁽²⁾, Manchester Diocesan Council for Education v. Commercial and General Investments Ltd.⁽³⁾ There must, in my view, be some particular circumstance which is very compelling indeed to enable an offeror to say that despite an initial rejection and the lapse of some 5 years his offer is still open and, in this instance, the claimants could have accepted it whenever they wished.  The Presiding Officer did not find any such circumstance and pointed cut that there was no evidence a all that in 1985/86, the attention of any of the claimants was drawn to the offer as one would expect if it was still open. I entirely agree with her reasoning and her decision. The offer was not still open in 1985.

12. I am furthermore of the opinion that even if the offer of $50 per day was still open in 1985 but had not been accepted if was not "a contract" for the purposes of Section 31E because there was no acceptance of the offer. The defendant says to that. "no matter - look at the causation - the offer could have been accepted and the refusal to do so caused the lack of entitlement to be maid." I do not accent that argument but am satisfied that there must be a contract - an accepted offer. The only one here was to pay the workers in accordance with the rates for piece work agreed from time to time. Otherwise an employer could offer his workers $10 a day and their refusal would debar them from claiming severance pay. That can't be right - the words "under the contract" In Section 31E cannot mean "under the contract or an unaccepted offer".

13. I am satisfied that this appeal must fail and is dismissed with costs to the 3rd claimant, to be taxed in accordance with the legal Aid Regulations. All claimants apart iron No. 12, 1 Har Oi Kuen are to have $160 each as expenses and loss of earnings occasioned by this appeal.

14. There will be an order for payment out of Court to the respective claimants in accordance with the amounts awarded to then by the Labour Tribunal plus interest as fixed in accordance with Section 39(4) of the Labour Tribunal Ordinance from the date of filing of the claim.

15. I would not like to leave this matter without adding that the Presiding Officer, Mrs. G. Chan, has set out the evidence in this matter and her reasons for coming to the conclusions which she has in a most clear and lucid manner which has made my task and that of counsel for both sides much simpler than it might have been.

(1) [1971] W.L.R. 1381, at 1385

(2) [1866] L.R.1 Ex. 109

(3) [1970] 1 W.L.R. 241