Welfare Finishing & Dyeing Fty Ltd v. Ma Yun Wah
Read the full judgment text of DCMP 21/1979 on BabelCite. This District Court judgment.
1. The Appellant ("the employer") appeals against a decision of the Labour Tribunal holding that the Respondent ("the employee") is entitled to a severance payment under section 31B of the Employment Ordinance ("the Ordinance").
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DCMP000021/1979 IN THE DISTRICT COURT OF HONG KONG HOLDEN AT KOWLOON CIVIL JURISDICTION LABOUR TRIBUNAL APPEAL NO. 21 OF 1979 -----------------
----------------- Coram: E.C. Barnes, D.J. Date of Judgment: 11th July, 1980 ----------------- DECISION ----------------- 1. The Appellant ("the employer") appeals against a decision of the Labour Tribunal holding that the Respondent ("the employee") is entitled to a severance payment under section 31B of the Employment Ordinance ("the Ordinance"). 2. The employer carries on the business of finishing and dyeing cloth at a factory in Castle Peak Road, Tsuen Wan. The employee commenced employment there as a factory hand in 1971. In 1973 he was promoted to the position of "Supervisor, Finishing Section". He held that post until his dismissal on 30th August 1979. 3. Before the Tribunal there was an issue as to whether the employee had been dismissed. It is now conceded by the employer that he was dismissed. 4. An employer is liable to make a severance payment to an employee if the employee is dismissed by reason of redundancy [s.31B(1)]. An employee is dismissed by reason of redundancy if his dismissal is wholly or mainly attributable to any of the facts ("redundancy situations") mentioned in paragraphs (a), (b) and (c) of section 31B(2) of the Ordinance. Given proof of dismissal there is, by virtue of section 31Q of the Ordinance, a rebuttable presumption that it was by reason of redundancy, that is, a rebuttable presumption that it was wholly or mainly attributable to one or more of the redundancy situations. Thus, by the Ordinance, the employer was liable to make a severance payment to the employee unless it was proved that the employee's dismissal was not wholly or mainly attributable to any of the redundancy situations. 5. An employer can show that a dismissal was not wholly attributable to any redundancy situation either by showing that there was no such situation or, if unable to do that, by showing that even if a redundancy situation did exist it had nothing at all to do with the dismissal, the dismissal being wholly attributable to a non-redundancy fact. He can show that a dismissal was not mainly attributable to any redundancy situation by showing that although one may have existed nevertheless the dismissal was mainly attributable to a "non-redundancy" fact. Hence, although proving that no redundancy situation existed means proving non-liability, the failure to prove non-existence does not necessarily mean failure to prove non-liability. Failure to prove the non-existence of the three redundancy situations has to be linked with failure to prove that a dismissal was mainly (if not wholly) attributable to a non-redundancy fact before it can be said that there has been a failure to prove non-liability. To the extent that the reasoning supporting one finding by the Presiding Officer implies that a failure to rebut "redundancy" is co-extensive with failure to rebut "dismissal by reason of redundancy" it does not accurately follow the guidelines of the Ordinance. 6. In order to determine whether an employer is liable to make a severance payment to an employee the tribunal has to analyse the evidence with this question in mind: has it been proved that the dismissal was at least mainly attributable to a non-redundancy fact? If the answer is, "Yes", the employer is not liable; if it is, "No", the employer is liable. 7. Paraphrased to fit the circumstances of this case the three redundancy situations are described in s. 31B(2) as:-
The Presiding Officer had before him the following evidence:-
8. That evidence, analysed in accordance with the provisions of the Ordinance, would provide the answer, "Yes", to the test question formulated above insofar as redundancy situations (a) and (b) are concerned because the compelling inference is that those two situations were non-existent. But as regards redundancy situation (c) that evidence shows:-
9. There was, therefore, evidence which suggested that there was an actual diminution in requirements of the employer's finishing and dyeing business for employees to carry out supervisory work at the Tsuen Wan factory. In short, the evidence tended to prove, if anything, the existence rather than the non-existence of redundancy situation (c). The Presiding Officer would have made a finding against the weight of the evidence if he had found that the non-existence of all redundancy situations had been proved. Consequently, the only basis on which he could have found the employer not liable was if the evidence proved that the dismissal was mainly attributable to something other than a diminished requirement for supervisors. 10. The employer's evidence was that the employee's dismissal was attributable solely to the fact that the negligent performance of his duties as a supervisor adversely affected the employer's business. The Presiding officer found that the dismissal was partly attributable to that fact but he was not satisfied that it was wholly or even mainly attributable to it. The employer, therefore, failed to rebut the presumption and, as a result, failed to establish non-liability. 11. At the hearing of the appeal the employer argued that the Presiding Officer did not advert to the employee's admission that there was "no redundancy" and therefore made a finding of "redundancy" against the weight of the evidence. The employer's case before the Labour Tribunal was conducted on the basis that "redundancy" meant redundancy situation (a) only and that non-redundancy was proved by proving that "business was good". The employee seems to have held the same view. Giving the admission the construction most favourable to the employer's case it was no more than an admission that "business was good". Such an admission was consistent with the compelling inference from the other evidence set out above, namely, the inference that the factory was increasing its output at the time of the employee's dismissal. Proof that "business is good" will usually lead to a finding that redundancy situation (a) does not exist but it does not prove that there is no redundancy situation (c). A factory may exhibit such indicia of a burgeoning business as increased output, expanding work-force and enhanced profits but, at the same time, have a diminished requirement for, say, accounts clerks because the business can afford to instal a computer. Redundancy situation (c) would then co-exist with the antithesis of redundancy situation (b). The failure of the Presiding Officer to mention the admission was no more than a failure to mention a part of the evidence tending to prove the non-existence of redundancy situation (a) of which there was more cogent proof in other evidence anyway and which was of no assistance in determining whether it had been proved that the dismissal was mainly attributable to some fact other than redundancy situation (c). 12. On the evidence the Presiding Officer had to find, having regard to the provisions of sections 31B and 31Q of the Ordinance, that the employer was liable. The appeal is, therefore, dismissed. 13. Date this eleventh day of July 1980.
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