Kin Man Garment Factory v. Lam Suk Ching

HCLA000058/1983

IN THE SUPREME COURT OF HONG KONG

LABOUR TRIBUNAL APPEAL NO. 58 OF 1983

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BETWEEN

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Coram: Hon. Clough, J. in Court

Date of Hearing: 1 February 1984

Date of Delivery of Judgment: 1 February 1984

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JUDGMENT

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1. The Appellant appeals with leave from the decision of a presiding officer of the Labour Tribunal given at the conclusion of her application for review on the 21st October 1983. His decision was to maintain his previous award of $1,820 in favour of the Respondent which he had duly made pursuant to s.21 of the Labour Tribunal Ordinance on the 5th September 1983 in the absence of the Appellant who had failed to turn up in time for the hearing.

2. The Respondent claimed the sum of $1,820 from the Appellant under s.8A(1) of the Employment Ordinance (Cap.57) alleging that the Appellant had wrongfully left her employment as a garment machinist of the Respondent without giving a month's notice under s.6 or payment of a month's wages in liou of notice under s.7 of the Ordinance.

3. The Appellant had worked for the Respondent from the 15th April 1981 until the 30th April 1983 when she left without notice or payment in lieu of notice. The contract of employment was an oral one without a fixed duration and her wages were paid on a piece rated basis. The Respondent's evidence was that the Appellant's actual wages were around $70-80 per day on average and he claimed the sum of $1,820 on the basis of 26 working days at $70 per day, allowing for 4 rest days in the month.

4. The Appellant when she appeared on her review application contended inter alia that the amount of $1,820 claimed was too high. She produced her bank passbook to show that her last month's wages had been $1,689 and she gave evidence, from the same source, of her actual earnings during the two months immediately preceding the last month of her employment. The Respondent accepts now that $1,689 was earned during the month of April 1983 by the Appellant.

5. No issue arises on this appeal in relation to the termination of the contract of employment. The presiding officer found it was wrongful and the Appellant has not appealed against that finding. She has appealed against the quantum of the award which she claims is excessive.

6. The presiding officer awarded the amount of $1,820 claimed by the Respondent because he found, in the light of the Appellant's own evidence of her earnings, that the figure of $70 per day used as a basis for the calculation of the Respondent's claim was a reasonable one. Moreover he considered that, since s.17(1) of the Employment Ordinance provided for one rest day in every period of 7 days, the Respondent's claim in respect of 26 days wages in the relevant month was reasonable where the contract of employment was on a piece-rate basis.

7. In her application for leave to appeal under s.32 of the Labour Tribunal Ordinance the Appellant sets out her average earnings during the last 3 months of her employment, makes various deductions which it is not here necessary to specify, and contends that the net average per month is $679 and that is the amount she should be required to pay to the Respondent.

8. On the 13th December 1983 I gave the Appellant leave to appeal against the award of $1,820 and, with her consent, gave her leave to add the additional ground of appeal that the award was excessive because it had not been calculated by reference to the Appellant's previous actual earnings pursuant to s.7(3) of the Employment Ordinance.

9. S.8A of the Employment Ordinance provides that an employee who terminates her contract of employment without notice or payment of wages in lieu of notice is obliged to pay to her employer ".... a sum equal to the amount of wages which would have accrued to the employee during the period of notice required by s.6". Here the relevant period of notice is one month.

10. The words in s.8A quantifying the sum to be paid by the employee are the same as the words appearing in s.7(1) to quantify the sum payable to the employer if the employee elects to terminate the contract of employment without notice but on payment in lieu of notice. The same words occur in s.7(3) which provides the method of calculating the quantum of the payment to be made by an employee whose remumeration has been calculated "by the piece or task".

11. The combined effect of s.6, 7, and 8A is therefore to provide that the parties to a contract of employment may terminate it by notice (s.6) or payment in lieu of notice (s.7) and that if either party terminates otherwise than in accordance with s.6 or 7, he or she is to pay a sum described in exactly the same terms as the sum payable under s.7(1) in lieu of notice.

12. Construing these provisions in accordance with s.19 of the Interpretation and General Clauses Ordinance (Cap.1), I conclude that it is necessarily to be inferred that the intention of the legislature is that the sum payable under s.8A on wrongful determination of a contract of employment is to be calculated in the same way as the sum payable in lieu of notice under s.7(1) and that there fore s.7(3) also governs the sum payable under s.8A.

13. Put another way, if a party terminates the contract of employment without notice but does not make payment in lieu of notice under s.7, then s.8A obliges that party to make the same payment as if he had elected to comply with s.7.

14. It follows, in my judgment that, in the present case where the relevant data is available, the sum payable to the Respondent by the Appellant, who was paid wages on a piece rate basis, is governed by s.7(3) of the Employment Ordinance and is the amount of wages earned by the Appellant during the period of one month (i.e. the period equivalent to the notice period) immediately prior to the wrongful termination of the contract of employment by the Appellant.

15. Therefore, however reasonable the claim of the Respondent and the award of the presiding officer may be, the award of $1,820 was made on the wrong basis and not in accordance with the requirements of the Employment Ordinance.

16. It follows that the Appellant's contention that a sum should be calculated over a 3 month period is fallacious. Furthermore, having regard to the wide terms of the definition of "wages" in s.2 of the Ordinance which is only qualified for the purposes of s.7 by s.7(4) in relation to over-time pay, none of the deductions sought to be made by the Appellant are permissible.

17. In the result the sum payable by the Appellant to the Respondent under s.8A of the Employment Ordinance calculated in accordance with s.7(3) is the sum of $1,689 being the equivalent of the actual earnings of the Appellant as a piece rated employee during the month immediately preceding the wrongful determination of the contract of employment by her.

18. Accordingly I will allow the appeal to the extent only of reducing the award from $1,820 to $1,689. As there was clearly a question of law involved I gave the Appellant leave to appeal on the additional ground upon which this appeal has in fact turned. However, the difference in the award following the appeal is so small that I consider that the fairest course is to make no order as to the costs of this appeal and to leave the presiding officer's order as to the costs before the Tribunal undisturbed.

Representation:

Appellant Lam Suk Ching - in person.

Respondent Wong Siu Mo Sole proprietor of Kin Man Garment Factory - in person.