Chang Ying Kwan v. Wyeth (HK) Ltd

DCEO000010/1999

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EQUAL OPPORTUNITIES ACTION NO 10 OF 1999

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Coram: HH Judge Saunders

Hearing: 20-24, 27-30 November, 1, 4,5, 18,19 December 2000

Date of Judgement: 26 February 2001

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JUDGMENT

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The claim:

1. This is a claim for damages by the plaintiff, Chang Ying-Kwan Ivy (Ms. Chang) against her former employer Wyeth (H.K.) Limited (Wyeth). Her claim is made relying upon the provisions of the Sex Discrimination Ordinance Cap 480 (SDO). Ms. Chang makes two claims, first that she was subjected to unlawful discrimination on the ground of her pregnancy, second that as a result of a complaint made by her to the Equal Opportunities Commission (EOC) of that discrimination she was victimised.

The defence:

2. The defence made by Wyeth to the claim is that all the steps taken in relation to Ms. Chang, about which she complains, were taken in order to properly monitor her work and because she did not have the appropriate competence for her position. The fact of her pregnancy, it is argued, was nothing but a mere coincidence. The acts of which Ms. Chang complains were, it is argued, simply neither discriminatory nor by way of victimisation.

3. It was conceded by Ms. Wong for Wyeth that, with one exception, an alleged exclusion from a particular meeting, the acts about which Ms. Chang complains are capable at law of constituting discrimination or victimisation in terms of the legislation. Ms. Wong accepts that the acts complained of were carried out in the course of employment with Wyeth.

4. In the course of submissions it was agreed by counsel that I should, at this stage, deal only with the issue of liability. As liability could potentially be determined on a number of bases, which in turn would have consequences as to the assessment of any damages that might flow from the findings as to liability, it was agreed that the question of damages, if any, would be reserved for further consideration following this judgement.

The documents:

5. There was sensible co-operation between the EOC representing Ms. Chang and the solicitors for Wyeth and a bundle of documents was prepared by Wyeth which was agreed and fully indexed, itemised and paginated. I shall refer to relevant documents by reference to the itemised numbers allocated to them in the bundle.

The factual background:

6. Ms. Chang was employed as a Product Manager in Wyeth's Pharmaceutical marketing Division. She commenced employment in July 1995. In September 1997 she became pregnant. Ms. Chang claims that shortly thereafter she suffered unlawful discrimination on the ground of her pregnancy. She made a complaint to the EOC which took up the matter with executives at Wyeth. She says that she then suffered discrimination by way of victimisation in respect of the complaint she had lodged with the EOC. She later took maternity leave and returned to work, but gave notice and resigned on 28 July 1999.

7. It is her case that under the wrongful pretext that her work was unsatisfactory Wyeth executives attempted to force her to resign on 23 October 1997, and after her refusal to resign and her complaint to the EOC, refused unreasonably to increase her salary and put her under unnecessary and unreasonable pressure by way of reporting and other requirements which lead to her ultimate resignation. She further contends that her complaints to management that she was being discriminated against were not properly investigated.

The Relevant Law:

The statutory scheme:

8. The relevant statutory provisions are contained in s 8(a), 9(1) and 11(2) SDO. Behaviour that constitutes acts of discrimination are set out in s 8 & s 9.

9. By s 8(a) less favourable treatment of a pregnant woman is deemed discriminatory in these terms:

"A person discriminates against a woman in any circumstances relevant for the purposes of any provision of Part III or IV if-

10. By s 9(1) SDO less favourable treatment consequent upon a complaint to the EOC is rendered discriminatory in the following terms:

"(1) A person ("the discriminator") discriminates against another person ("the person victimised") in any circumstances relevant for the purposes of any provision of this Ordinance if he treats the person victimised less favourably than in those circumstances he treats or would treat other persons, and does so by reason that the person victimised or any other person ("the third person") has-

The acts set out in ss 9(1)(a)-(d) are known as "protected acts".

11. The SDO, in Part III, s 11(2), makes acts of discrimination in the employment field unlawful in the following terms:

"It is unlawful for a person, in the case of a woman employed by him at an establishment in Hong Kong, to discriminate against her-

12. Relying upon these provisions Ms. Chang makes a number of specific claims including:

(i)	That on 23 October 1997 she was required to either resign or be downgraded;
(ii)	That from October 1997 she was subject to various forms of unfair pressure, including the imposition of reporting requirements, unfair criticisms, unreasonable workloads, and unreasonable warnings.
(iii)	That in 1998 and 1999 she was refused a salary increase;

The English Law:

13. It is clear that the Hong Kong legislation in relation to discrimination is modelled on the equivalent English legislation, which is comprised of the Sex Discrimination Act and the Race Relations Act (UK). In Ray Chen v IBM China Hong Kong Limited EO 3/2000 I set out a comparison of a number of the relevant provisions.

14. A large body of case law in relation to both the Sex Discrimination Act and Race Relations Act has arisen in England in the 15 years or so that those acts have been in force. As the terms of the legislation are so close it is plain that the courts in Hong Kong may look to the English cases for guidance on the interpretation of the Hong Kong law. They will be persuasive authorities but the courts in Hong Kong should not blindly follow the English approach which may, on occasions, not be appropriate for Hong Kong conditions.

15. However, there is no equivalent in the English legislation to the specific pregnancy provisions of s 8 SDO. Nothing turns on that for it is clear that s 8 is merely a specific example of the generic concept of discrimination and exists in the Ordinance to ensure that that specific situation is covered. Notwithstanding that there is no equivalent to s 8 SDO in England I am satisfied that the principles and interpretations applied in relation to other aspects of discrimination legislation in England should also be applied in relation to claims where s 8 SDO is raised.

The appropriate test:

16. The forms of discrimination alleged by Ms. Chang, i.e. as a consequence of pregnancy and victimisation consequent upon a complaint to the EOC, are commonly called "direct discrimination". In cases of direct discrimination the approach to determining whether there is less favourable treatment on the prohibited ground is the "but for" test enunciated by the House of Lords in R v Birmingham City Council ex parte Equal Opportunities Commission [1989] AC 1155 and James v Eastleigh Borough Council [1990] 2 AC 751. The same test is applied in cases of victimisation: see Nagarajan v London Regional Transport [1999] 1 AC 501.

17. Ms. Wong for Wyeth sensibly accepted that these are the appropriate authorities in respect of the test to be applied and that;

18. The "but for" test requires a comparator against whom the conduct applied to the plaintiff is measured. In the case of pregnancy discrimination the comparator is not another pregnant employee but a person who is a normal employee: see Chief Constable of West Yorkshire Police v Khan [2000] IRLR 324.

The burden of proof in discrimination & victimisation cases:

19. It is unusual to find direct evidence of discrimination, and discrimination usually depends upon what inferences it is proper to draw from the primary facts. Recognising this situation the SDO provides as follows:

20. Again, there is no direct equivalent to this provision in the English legislation. The English courts have met the situation by judicial interpretation. When considering the plaintiff's claim and the evidence and applying s 4, I was encouraged by Mr Poon to bear in mind the words of Neill LJ in King v G.B.-China Centre [1999] 516 at 528:

"Though there will be some cases where, for example, the normal selection of the applicant for a post or for promotion is clearly not on racial grounds, a finding of discrimination and a finding of a difference in race will often point to the possibility of racial discrimination. In such circumstances the Tribunal will look to the employer for an explanation. If no explanation is then put forward or if the Tribunal considers the explanation to be inadequate or unsatisfactory it will be legitimate for the Tribunal to infer that the discrimination was on racial grounds. This is not a matter of law, but, as May LJ put it in North West Thames Regional Health Authority v. Noone [1988] ICR 813 at 822 'almost common sense'".

21. Ms. Wong submitted that s 4 did not assist the plaintiff where the discrimination complained of was by way of victimisation. I accept that submission. The Ordinance, in s 4, does not, in terms, refer to victimisation. It may have been an oversight on the part of the draftsman, or it may have been a deliberate decision, that resulted in victimisation being omitted from s 4, but its absence must mean that in that respect the section does not apply. Ms. Wong accepted that the sole motive for a discriminatory act need not be victimisation, but she said victimisation must have been "a significant influence" in bringing about the act or omission for which complaint is made. That submission was made, relying upon two decisions.

22. The first was the decision of Slynn LJ in Seide v Gillette Industries Ltd. [1990] IRLR 427 where, in relation to the Race Relations Act (UK) he said:

"It does not seem to us to be sufficient merely to consider whether the fact that the person is of a particular racial group within the definition of the statute is any part of the background, or is (as it is said in other cases) a causa sine qua non of what happens. It seems to us that the question which has to be asked is whether the activating cause of what happens is that the employer has treated the person less favourably than others on racial grounds."

23. In the second, Nagarajan v London Regional Transport [1999] 1 AC 501 at 512H Lord Nicholls of Birkenhead expressed the issue in this way:

"Decisions are frequently reached for more than one reason. Discrimination may be on racial grounds even though it is not the sole ground for the decision. A variety of phrases, with different shades of meaning, have been used to explain how the legislation applies in such cases: discrimination requires that racial grounds were a cause, the activating cause, a substantial and effective cause, a substantial reason, an important factor. No one phrase is obviously preferable to all others, although in the application of this legislation legalistic phrases as well as subtle distinctions, are better avoided so far as is possible. If racial grounds or protected acts had a significant influence on the outcome discrimination is made out."

24. In the same case at p 518H Lord Steyn says;

"The issues arising for determination by the House are: (1) whether on a true construction of section 2(1) of the Act of 1976 the person alleging to have been victimised must establish that, in treating him less favourably than he treats or would treat another, the alleged discriminator was consciously motivated or whether it is sufficient to establish that the principal or an important cause of the less favourable treatment was the fact that the victimised person had done a protected act;"

25. His Lordship concludes a review of the authorities and a comparison of the Race Relations Act with the Sex Discrimination Act and at p 522B says:

"Common sense suggests that the tribunal should also perform its functions in a section 2(1) case by asking the equally straightforward question: Did the defendant treat the employee less favourably because of his knowledge of a protected act. Given that it is unnecessary in s 1(1)(a) cases to distinguish between conscious and subconscious motivation, there is no sensible reason for requiring it in s 2(1) cases."

26. It may be seen that the standard set by Lord Steyn is lower than that sought by Lord Nicholls or Slynn LJ. Whereas Lord Nicholls would require that there be a 'significant influence', and Slynn LJ an 'activating cause' Lord Steyn merely required that the employee must be so treated because of the employers knowledge of the protected act. The evidence required to meet either Lord Nicholls' or Slynn LJ's criteria may often be difficult if not impossible for a plaintiff to adduce. On the other hand the mere fact of knowledge of the protected circumstance, in this case Ms. Chang's complaint to the EOC, is a very heavy burden to place upon an employer. The adoption of that standard may well leave an employer thinking that he simply cannot take any steps in relation to an employee who has made any sort of complaint, for fear of a charge of victimisation. It will be only in rare cases, as exemplified by the decision in Ray Chen (supra), that an employer will be able to rely with any degree of confidence upon s 9(2).

27. I have concluded that the appropriate balance can be achieved by applying the words of Neill LJ in the exercise of determining whether there has been victimisation. It should not be necessary for a plaintiff to carry the difficult burden of establishing that any of the acts protected under s 9(1)(a)-(d) be either a significant influence or an activating cause of the treatment received by that person. At the same time, mere knowledge of the protected act on the part of an employer ought not to be the threshold to be met by a plaintiff. In my view a person who complains of discrimination by way of victimisation under s 9 SDO must establish that one at least of the four acts set out in s 9(1)(a)-(d) was within the knowledge of the defendant at the time he carried out the acts of which the plaintiff complains. Once that has been established, in the absence of an adequate or satisfactory explanation, a plaintiff will have established, on the balance of probabilities that there has been victimisation. The burden of establishing that there has been no adequate or satisfactory explanation of the conduct lies upon the plaintiff.

28. Thus, to make out her case of discrimination Ms. Chang, on whom the burden of proof on the balance of probabilities lies throughout, must establish that one of the reasons for the treatment that she received was her pregnancy. To make out her case of victimisation she must establish that the fact that she had made a complaint to the EOC was within the knowledge of Wyeth and that there has been no adequate or satisfactory explanation for that treatment.

29. Ms Wong did not contend that Wyeth should not be responsible for the actions of its employees. By s 46(1) SDO anything done by a person in the course of his employment is treated, for the purposes of the Ordinance, as done by the employer whether or not it was done with the employers knowledge. The extent of the application of this provision may be seen in the decision of Jones v Tower Boot [1997] IRLR 168.

30. In a schedule to the defence Wyeth set out 14 matters prior to 23 October upon which it based its assertion that Ms. Chang lacked appropriate competence. Also set out were a further 19 matters which occurred after 23 October which, it was argued, justified the actions of Wyeth employees after that date. I made it clear during the course of the trial that I did not propose to examine each and every one of these in minute detail, and to reach a decision on the merits of each, and that I would take a broad view of these matters. It is for that reason that, during the trial, from time to time I restricted cross-examination of both parties witnesses. That approach was accepted by Ms. Wong (Submissions, para 26) and accords with authority where the same approach is taken in unfair dismissal cases. There is a close relationship between the issues raised in a case such as this and an unfair dismissal case and I am satisfied that the same approach is appropriate.

31. In unfair dismissal cases in England the industrial tribunals are required to have regard to "equity and the substantial merits of the case" in deciding whether a dismissal is unfair. In Union of Construction and Allied Trades and Technicians v Brain [1981] IRLR 224 at 227 Donaldson LJ expressed the matter in this way:

"[the tribunal] has to look at the question in the round and without regard to a lawyer's technicalities. It has to look at it in an industrial relations context and not in the context of the Temple and Chancery Lane."

I accept Mr Poon's submission that:

"the statutory reference in England to 'equity and the substantial merits of the case' resonates with the phrase 'the need to determine the substantial merits of the case' in the District Court Ordinance s 73B(5)"

and hold that Donaldson LJ's approach is appropriate in the equal opportunities jurisdiction. I do not, in this judgement, propose to look finely at every one of the 33 incidents relied upon by Wyeth. Some incidents are incapable of resolution. Some merely reflect that two different legitimate views may be taken of a situation. Some are clear as to right and wrong. I propose to look at the evidence in the round, considering some of the detail of some of the incidents in this judgement. That I have not dealt in fine detail with an incident does not mean that I have ignored it. I have had regard to the whole of the evidence.

32. I have viewed the issues by looking at the evidence in the round, in the context of employment and human relations, and the dignity and rights accorded to a person by equal opportunities legislation.

33. In the light of this review of the relevant law I turn now to consider the facts of the case. Generally, there was little dispute about the facts, the main area of contention between the parties being the emphasis and inferences to be drawn from the facts and the conduct of the participants. Where there was a difference between Ms. Chang and Richard Kwan or Francesca Lui I did not find either Richard Kwan or Francesca Lui to be credible witnesses. They were at times evasive and, as will be seen, gave answers which were simply not consistent with known facts. That will be seen from the incidents that I have considered. The facts and circumstances as I state them are as I found them to be on the balance of probabilities.

Facts not in dispute

34. Throughout the whole of the relevant period Lawrence Woo, based in Shanghai, was the President and Managing Director of Wyeth's China and Hong Kong operations. The General Manager of Wyeth in Hong Kong was Jackson Fong. Next in the chain of management was Richard Kwan who was Manager of the Pharmaceutical Products Division (PMD). That division had four Product Managers (PM's) including Ms. Chang and Francesca Lui.

35. It was Richard Kwan's evidence that Jackson Fong did not like Ms. Chang. Jackson Fong was not called to give evidence and no reason for his attitude was given by Richard Kwan or Francesca Lui.

36. Ms. Chang held a degree of MBA from Monash University Melbourne Australia, a Graduate Diploma in Business Administration and a BSc in Chemistry from The Chinese University of Hong Kong. She had been working in the field of pharmaceutical marketing in various capacities from December 1991 until she commenced employment with Wyeth in July 1995. In January 1996 she received a salary increase of 11%.

37. In December 1996 Ms. Chang received a written warning in relation to her conduct over dealings with a Dr Calimon, a medical practitioner who gave medical advice to Wyeth. Notwithstanding that warning she received a salary increase of 10% in January 1997.

38. Ms. Chang became pregnant in September 1997 informed Wyeth's Human Resources Department in that month. On 23 October 1997, at a meeting between Ms. Chang, Richard Kwan and Iris Leung, a Wyeth Human Resources officer, Ms. Chang was presented with an ultimatum by Richard Kwan that she should either resign or be demoted to the position of Marketing Assistant. Ms. Chang refused to resign or to accept a demotion. On 27 October 1997 Ms. Chang complained to the EOC that the requirement that she resign or be demoted was discriminatory by reason of her pregnancy. On 31 October 1997 Wyeth received a letter from the EOC informing it that Ms. Chang had lodged a complaint of discrimination on the ground of her pregnancy, and was accordingly, thereafter, aware that the complaint had been made.

39. Ms. Chang was not given a salary increase in 1998, when other employees of Wyeth received salary increases. She was required after the 23 October 1997 meeting to make various reports to Richard Kwan and Francesca Lui Lui, a requirement that was not imposed, on equivalent terms, on other PM's. On 6 January 1998, after attending an antenatal examination, she was given a written warning in respect of alleged unauthorised leave, a warning that was not given to other employees in equivalent circumstances. In 1999 her salary increase was 2.3%; the other PM's received 3-3.5%. Ms. Chang resigned from Wyeth on 28 July 1999.

40. I accept, as does Mr Poon for Ms. Chang, that the case is one based solely on inference and that there is no direct evidence of deliberate, overt, plainly stated discrimination or victimisation.

The structure at Wyeth prior to May 1997:

41. Prior to May 1997 Ms. Chang was one of four PM's in the PMD of Wyeth. She was responsible for oral contraceptive, (OC) prenatal and central nervous system products. The role of a PM was to plan marketing activities and budget, with full profit and loss responsibilities, formulate and implement marketing strategies and promotion activities, attend to product registration and product package development, provide training to sales representatives and co-ordinate clinical studies. From October 1996 the Division manager was Richard Kwan. His role was to manage both the marketing and sales teams and to deliver the budget for forecast sales and profits. Another of the Product Managers was Francesca Lui. She was PM in charge of Hormonal Replacement Therapy (HRT) products. Both Ms. Chang and Francesca Lui reported to Richard Kwan.

42. In the usual way of a major corporation Wyeth conducted annual reviews of its staff's competence and annual salary reviews. Prior to the middle of 1997, other than the Calimon warning letter, there was no indication to Ms. Chang that her performance was in any way unsatisfactory. At the beginning of 1997 she received a salary increase and was told by Richard Kwan that the increase was above both the industry average and the inflation rate and that the company appreciated an employee who was performing well.

The May 1997 Restructure:

43. In May 1997 the PMD was restructured. Francesca Lui had, in January 1997. been promoted to the post of Senior Product Manager. One of the changes in the restructure was the consolidation of the OC and HRT products into a single franchise or Female Healthcare Group. Francesca Lui was to head the marketing of these products, being responsible for strategic planning and objective setting and Ms. Chang was responsible for program implementation, reporting to Francesca Lui, who in turn reported to Richard Kwan.

The 20 May 1997 discussion:

44. Unfortunately, Ms. Chang and Francesca Lui did not work particularly well together. They had quite different working styles. Notwithstanding that Ms. Chang and she worked only metres away from each other, it was Francesca Lui's practice to use e-mail extensively and to copy virtually all e-mail to her seniors, apparently to keep them informed as to her progress with her tasks. If she did not get a reply within the time she expected there would be follow up e-mails. This deluge of e-mails did not bring the desired response from Ms. Chang, who, if she was attending to another matter would not immediately respond, but wait until she was ready with a response. However Ms. Chang was not told that her manner of dealing with the e-mails was not satisfactory. Francesca Lui and Ms. Chang were both called to see Richard Kwan on 20 May 1997 and were told that they should use more verbal communication and be less reliant on the e-mail system. The action taken by Richard Kwan did not in any way signal to Ms. Chang that her performance was considered poor, in fact the action appeared to support her view that Francesca Lui relied too heavily on e-mail.

45. On 6 June 1997, 16 days after the event, Richard Kwan sent a memorandum (Doc 41) to Ms. Chang in which he purported to set out the matters that were discussed in the 20 May 1997 meeting. It was Ms. Chang's evidence that these matters had not been discussed at the meeting on 20 May 1997, but as she did not disagree with it as a statement as to her duties she did not raise any issue. Richard Kwan, in his evidence did not assert that the matters in the memorandum were raised in terms at the meeting, but confined himself to saying that matters of communication between Ms. Chang and Francesca Lui were discussed.

46. There is nothing in the memorandum from which it can be said that there was any real concern as to Ms. Chang's performance of her duties. At the meeting on 20 May 1997, other than the discussion as to the use of e-mail, nothing had been said to Ms. Chang that might have alerted her to concerns about her behaviour.

47. On 23 July 1997 Francesca Lui e-mailed Richard Kwan (Doc 43) regarding Ms. Chang's response to the 6 June 1997 memo (Doc 41) recording that assistance was being given in a timely manner, and was satisfactory. She said that Ms. Chang displayed satisfactory discipline but that initiative was not enough in some areas. She concluded:

"the real attributes of being a manager instead of a marketing assistant is not evidenced."

48. Significantly, she conceded that communication, the only matter that had been discussed with Ms. Chang, was the responsibility of both parties.

49. Neither this memorandum, nor its conclusion, were discussed with Ms. Chang. On the same day Richard Kwan forwarded the e-mail to Jackson Fong (Doc 45) with the comment that:

"My observation is that Ms. Chang has been improving in both communication with superior/colleagues and work attitude"

50. He made no reference to Francesca Lui's concluding remark.

The 10 September 1997 performance appraisal:

51. In June all staff members of the PMD were asked by Richard Kwan to conduct a half yearly performance appraisal which he thereafter discussed with them. Ms. Chang duly submitted hers, (Doc 46), which Richard Kwan discussed with her. He passed it onto Jackson Fong on 10 September 1997 without any adverse comment.

52. Surprisingly, although his evidence was that Francesca Lui was finding Ms. Chang lacking in initiative and not displaying the attributes of a product manager at that time, nothing was said to Ms. Chang, nor, with the exception of the mere forwarding of Doc 43, was any adverse written remark ever made to Jackson Fong. It was Ms. Chang's evidence, unchallenged by Richard Kwan, that her performance, in some respects, exceeded expectations and that there was no indication given to her that her performance was unsatisfactory. Had it been in any way unsatisfactory, such a half yearly appraisal would have been an appropriate place to raise matters of concern with Ms. Chang. The only thing Jackson Fong had been told was that Ms. Chang's communication. with superiors and colleagues was improving.

53. On 18 September 1997 Francesca Lui reviewed the memorandum of 6 June 1997 with Ms. Chang, telling her, according to Ms. Chang, that Gordon Yuen, Wyeth's Human Resources Director had emphasised the need for continuous appraisal at a recent workshop. Francesca Lui's evidence was that she did not recall the reason why the meeting took place. Again, and this was specifically accepted by Francesca Lui, nothing was said to Ms. Chang to indicate that either Richard Kwan or Francesca Lui considered any aspect of Ms. Chang's work to be unsatisfactory. No specific matters of concern were raised.

The notification of the pregnancy:

54. Ms. Chang became pregnant in September 1997. Her evidence, undisputed, was that on 23 September 1997 she advised Carrie Wong of the Human Resources Department of the pregnancy and gave her a certificate (Doc 12) dated 14 September 1997 confirming the fact of a positive pregnancy test on 14 September 1997 and that her last menstrual period was on 5 August 1997. She said that at about the same time also told Richard Kwan and Francesca Lui (who was herself pregnant at that time). She did not show the certificate to either Richard Kwan nor Francesca Lui. There is no evidence as to whether she told them her expected date of confinement.

55. On 7 October 1997 Ms. Chang received a memorandum (Doc 13). This was signed by Iris Leung of the Human Resources Department, and copied to Jackson Fong, Richard Kwan and Gordon Yuen. The terms of the memorandum are significant and I set it out in full in its precise terms:

56. The inference drawn by Ms. Chang from the penultimate paragraph of this memorandum was that it was a threat that if the required certificate was not promptly lodged the company reserved the right to deprive her of her maternity leave. Ms. Wong did not dispute that that was the intended inference.

57. It was the evidence of Iris Leung that she was instructed to write the memorandum by Jackson Fong. She said that he did not exactly instruct her to write it in its terms but that he asked her "to refer to company manuals and to prepare a draft for his approval". The specific terms of the memorandum were approved by Jackson Fong. When asked why she did not simply phone Ms. Chang and tell her what was required she said that she knew that Jackson Fong and Richard Kwan were not satisfied with Ms. Chang's performance and at the same time there was news that she was pregnant. She said that they were unhappy that proper documentation had not been given. She said that when they talked about the situation:

"they said 'Hey, seems she hadn't given documentation regarding her pregnancy' so the management decided to issue this memo that would require her to follow the formal procedure."

58. That conclusion was quite wrong. Written notification (Doc 12) had in fact been given to the Human Resources Division.

59. Iris Leung acknowledged that, as far as she was aware, no other case of a pregnant employee had resulted in such a memorandum being issued. She said that at one time there had been many employees who became pregnant and that there was no formal channel by which employees could give sufficient information to the company. A formal procedure was, she said, later established. In the light of the absence of "formal guidelines" which presumably would be contained in company manuals it is mystery as to what document Jackson Fong was referring to when he told her to consult "company manuals."

60. It would have been quite a simple matter, to calculate from the certificate that had been supplied, Doc 12, that her confinement would be in approximately May or June 1998, some 9 months on. It was an equally simple matter for either Jackson Fong, Richard Kwan or Francesca Lui, if they had any concern as to the effect of Ms. Chang's maternity leave on the operations of the PMD, to either calculate the approximate time of that leave from the time they were told of the pregnancy or to simply ask Ms. Chang about the issue.

61. There was no evidence at all from Wyeth that it was necessary that the precise dates should be established as early as October 1997 or why any greater documentation, other than that in Doc 12 should, at that time, be supplied. There was no explanation from Jackson Fong or Richard Kwan as to why they simply did not ask Ms. Chang when she would take maternity leave. Instead a threatening memorandum was sent to her.

62. To comply with the memorandum, on about 17 October 1997, Ms. Chang submitted a further medical certificate dated 11 October 1997 (Doc 14) confirming her expected date of confinement as 12 May 1998 (mistakenly written in the certificate as May 1988).

The ultimatum on 23 October 1997:

63. On 18 September 1997 Francesca Lui had reviewed with Ms. Chang the memorandum of 6 June 1997 (Doc 41) and had made no criticism of her conduct to her nor had she made any record of problems. There was nothing at all to indicate that within 35 days Ms. Chang would be required to resign or be demoted by reason of her poor performance.

64. On 23 October 1997 at about 5.00 p.m. Ms. Chang was required to attend a meeting with Richard Kwan and Iris Leung. At that meeting Richard Kwan told her that her performance was unsatisfactory and that Wyeth required her to resign or she would be downgraded to the post of Marketing Assistant (albeit at the same salary) effective the next day. It was Ms. Chang's evidence that she was shocked and asked Richard Kwan to state specifically the ways in which her performance was unsatisfactory. She said that he declined and repeated the demand to resign. Richard Kwan accepted that she asked him to specify aspects of unsatisfactory performance and that he declined to do so. He said that he had been instructed by Gordon Yuen that it was not necessary to do so. It was Iris Leung's evidence that throughout the meeting Ms. Chang remained controlled and polite and that Ms. Chang asked for time to consider the proposal. She too said that Ms. Chang asked for specific details of poor performance and did not contradict Richard Kwan's evidence that he did not give an explanation. Neither did she contradict Ms. Chang's assertion that she told Ms. Chang that Wyeth felt that Ms. Chang had had a performance problem since October 1996 and that she had been closely observed from that time.

65. Ms. Chang considered her position overnight and the next day spoke with Gordon Yuen and told him that she was being unfairly treated and demanded a proper evaluation. Her uncontradicted evidence was that Gordon Yuen told her that he had no idea about her performance and that the action was based on information supplied by Richard Kwan and Francesca Lui. He agreed to speak to Richard Kwan about an evaluation. Shortly thereafter Richard Kwan informed Ms. Chang that he would not agree to a further evaluation and that she must resign or be demoted. He required a decision from her by 27 October 1997. This evidence he did not dispute.

66. On 27 October 1997 Ms. Chang informed Richard Kwan that she had made a complaint to the EOC, a fact he passed onto Jackson Fong. Ms. Chang refused to resign or to accept the demotion.

67. On 28 October 1997 Francesca Lui supplied to Richard Kwan, at his request, a performance appraisal on Ms. Chang (Doc 47). Over 3 1/2 pages she enumerated a series of complaints. The Premelle and Prenatol matters, to be referred to later, were included. This appraisal, the first comprehensive documentary assessment of the situation, was copied to Jackson Fong and Gordon Yuen. Richard Kwan explained the preparation of this document as being "in the light of this development, and for the sake of good records." The "development" he referred to was the complaint to the EOC. He described it as a "consolidation" of Francesca Lui's observations from May to October 1997. All of these "observations" however had escaped previous documentation.

68. In a further discussion on 28 October 1997 Richard Kwan told Ms. Chang that she would be evaluated. Although he denied Ms. Chang's evidence that he said to her that evaluation would be difficult for her he accepted that he told her that an evaluation would not be good for her baby.

69. On 5 November 1997 Richard Kwan prepared a confidential report to Jackson Fong (Doc 48). In this report he describes Ms. Chang's reputation in the company as "bad with serious attitude and interpersonal relation problems". He said he had known this since October 1996. He said that under his direct supervision "we have started building up documentation to substantiate the performance problem."

70. On 6 November 1997, in Doc 49, Ms. Chang responded to Francesca Lui's memorandum of 28 October 1997 (Doc 47). In that reply she deals comprehensively with all matters raised by Francesca Lui and supports her views with extensive documentation. This memorandum was given to Francesca Lui who made a number of hand-written notes by way of response. However beyond those notes no action was taken and Ms. Chang was never told of the response. There was no evaluation or discussion of the matters raised by Francesca Lui and replied to by Ms. Chang. Richard Kwan explained this by saying that to discuss the matter further would be to start a useless series of accusations and denials which would achieve nothing.

71. On 10 November 1997 Ms. Chang wrote to Lawrence Woo, (Doc 223), assuring him that she had no wish to publicise the matter of her complaint to the EOC but that she wanted to resolve a situation where she felt discrimination. Lawrence Woo simply referred the matter back to Jackson Fong.

Wyeth's justification for the ultimatum:

72. The need to "build up documentation" was obvious to Richard Kwan for there was nothing in existence except Francesca Lui's e-mail to Richard Kwan dated 23 July 1997 (Doc 43) to support his position that Ms. Chang was incompetent to be a PM. The "Calimon warning", nearly ten months old, was stale and not sufficient, and subsequent events showed that the matter was well behind both Ms. Chang and Dr Calimon. I propose to refer to three specific matters in relation to the documentation relied upon by Wyeth. All came into existence after the 23 October 1997 ultimatum was given.

73. That documentation was being "built up" may first be seen by an e-mail Richard Kwan sent to Ms. Chang at 7.17 p.m. on 27 October 1997 (Doc 86). He responded to an enquiry from Ms. Chang for information by saying that she had been previously given the information on 24 October 1997, and he expected a decision from her on the matter. Ms. Chang in turn replied comprehensively on 28 October 1997 (Doc 88) demonstrating to Richard Kwan that they had simply not had time to discuss the matter. It must of course be remembered that 24 October 1997 was the day after Richard Kwan's ultimatum to Ms. Chang to resign or be demoted. There was no response by Richard Kwan to Ms. Chang's e-mail.

74. An incident regarding a memorandum from the USA head office in relation to a World Health Organisation (WHO) circular (Doc 137) provides a second example. The circular was received by Richard Kwan on 11 November 1997. The circular refers to risk issues with low-dose oral contraceptives. Richard Kwan referred it to both Francesca Lui and Ms. Chang with a simple endorsement "Pls. Note". He did not enquire further from Ms. Chang about the matter. Francesca Lui was at home on maternity leave at the time but the memorandum came to her attention. On 19 November 1997 Francesca Lui faxed Richard Kwan from her home (Doc 136) suggesting that the salesmen should be briefed on the matter. In the fax she suggested that by not briefing the salesmen Ms. Chang had demonstrated a lack of initiative.

75. On 20 November 1997 Richard Kwan, in a written memorandum (Doc 137), elevated the matter from one he required Ms. Chang to "note", and which he had not pursued for 9 days, to a situation that required him to record his "deep disappointment" at lack of initiative in failing to discuss it with him. He said that he did not understand why she did not make a move or a suggestion on giving a briefing session to the salesforce. Ms. Chang responded on 24 November 1997 (Doc 138) pointing out that the data was not new and well known. She reminded him that it had been arranged that there would be no training sessions for sales staff in November and that she planned to include it in the December training. She pointed out that there was no indication that "crisis management was required" until she received his memorandum. There was no response from Richard Kwan.

76. A perusal of the memorandum from the head office shows that the information was simply to be made available to the sales force and others who may be questioned on the issues. Ms. Chang was quite correct when she said that there was nothing to indicate that crisis management was required. The simple fact is that an urgent briefing of the sales force was not required by the information in the WHO circular.

77. Finally the exchange of e-mails in Doc 89 provides another example of Richard Kwan's attempts to "build up" a paper trail of default by Ms. Chang, as do Docs 92, 93 and 149. In each case Ms. Chang makes it clear that the position adopted by Richard Kwan is without foundation.

Particular matters of misconduct by Ms Chang:

78. Despite the alleged existence of "close observation" there was not a single document in existence, of which Ms. Chang was aware, other than the written warning about Dr. Calimon, in which any reference was made to poor behaviour on Ms. Chang's part. Indeed the only three contemporaneous documents, (Docs 41, 43 & 46) did not suggest "close observation" was either required or was to be undertaken. Of those documents, the earliest in time was dated 21 June 1997.

79. One matter relied upon at trial by Wyeth in its assertion of Ms. Chang's incompetence and lack of initiative was an exchange of e-mails between Francesca Lui and Ms. Chang concerning the establishment of a telephone hotline for OC products. On 22 May 1997 Francesca Lui e-mailed Ms. Chang asking her to start preparation of a structure and script of the hotline (Doc 37). Ms. Chang replied asking for some idea of the framework of the telephone system and technical constraints that she would need to bear in mind (Doc 38). A sensible reply, quite uncritical of the request, was given by Francesca Lui saying not to put any limitations on the script (Doc 39). The matter was not raised again with Ms. Chang. But it featured as part of Wyeth's justification at trial for the ultimatum. The incident illustrates the way in which Richard Kwan sought to turn innocent matters against Ms. Chang. The situation was one in which Ms. Chang was potentially damned whichever course she took. If she made the inquiry she would be criticised for lack of initiative. If she did not make the inquiry and the work product was useless as not fitting the constraints of the system, she would be criticised for lack of initiative in not checking the system limitations before commencing work. This incident did not form part of the detail in Francesca Lui's performance appraisal (Doc 47) prepared following the ultimatum on 23 October 1997. The inquiry made by Ms. Chang cannot be described as showing a lack of initiative, and, I am satisfied, played no role at all in the decision to give the ultimatum.

80. In cross-examination, when pressed as to what had happened between 18 September 1997 and 23 October 1997 to justify the ultimatum, Richard Kwan relied upon two incidents, one the Premelle packaging, the other the Prenatol leaflet. The Premelle packaging matter had occurred prior to 18 September 1997 and must have been in both his and Francesca Lui's minds when Francesca Lui conducted the review on 18 September. Yet it was not important enough to raise with Ms. Chang at that time. The production of the Prenatol leaflet was happening between 16 and 18 September 1997 and was a live issue on the very day that Francesca Lui held her discussion with Ms. Chang. Again it was not raised in the discussion on 18 September 1997. Neither matter warranted any written record at all.

81. Neither matter can provide a basis for Richard Kwan to say that Ms. Chang's performance had deteriorated since 18 September 1997 to the stage where dismissal was justified. Neither were mentioned by Richard Kwan in his report on the situation to Jackson Fong on 5 November 1997 (Doc 48). Richard Kwan was unable to refer to any other matters upon which he might rely. In any event his position in evidence was quite inconsistent with his assertion to Jackson Fong in Doc 48 that Ms. Chang's performance had improved since 18 September 1997.

82. The circumstances of the "Hysterectomy Advertorial" provides an example of a situation where Ms. Chang was not at fault but Wyeth attempted to turn the situation against her at trial. It was desired that there be a series of 8 advertisements which would, in a short illustrated story form, educate and inform readers by exposing an issue that may be resolved by the use of a Wyeth product. In mid April 1997 Richard Kwan and Francesca Lui began dealing with the matter. Responsibility was given to Ms. Chang in mid June. It involved Ms. Chang dealing directly with Dr Calimon. Despite the previous difference between them that had produced the warning letter the correspondence demonstrates that whatever had occurred was well behind them. They communicated sensibly and without any side at all. There was copious correspondence between Ms. Chang, Dr Calimon and an advertising agency. But continued difficulties in resolving the format meant that the project was greatly delayed. However it was not until December 1997 when the proposal was called off.

83. Calling off the project was an embarrassment and Richard Kwan asked Francesca Lui, who was on maternity leave, to review the papers in an effort to determine what went wrong. Four points were made in a report by Francesca Lui (Doc 72), none of which was a direct criticism of Ms. Chang. A reading of the papers shows that she was merely in the middle of difficulties between Dr Calimon who, sensibly, demanded a medically credible scenario, and a dilatory advertising agency, constantly changing its copywriters, who were unable to produce a scenario and script that would meet Dr Calimon's criteria. And yet when the matter came to trial the emphasis of the case for Wyeth was that the debacle lay entirely at the hands of Ms. Chang. That that was not so is demonstrated by a reading of Francesca Lui's report and the supporting correspondence.

84. In his evidence Richard Kwan said that he was particularly concerned about this matter in September 1997 and relied upon in it his justification of the 23 October 1997 ultimatum. He describes it as "a serious failure". But it is clear that the matter, while ongoing, was not a even matter of concern at that time. Ms. Chang, was, as required liasing between the advertising agency and Dr Calimon. As Francesca Lui's December report showed the problem did not lie with Ms. Chang and indeed the whole matter was not perceived as a problem in September 1997. It was not mentioned by either Richard Kwan or Francesca Lui in any of the subsequent papers they prepared in late 1997 in relation to the ultimatum. I reject Richard Kwan's contention that he had discussed it with Francesca Lui in September and that he considered it a "serious failure" on Ms. Chang's part. If he had, it would plainly have featured in Francesca Lui's 28 October 1997 appraisal of Ms. Chang, (Doc 47), and his report to Jackson Fong (Doc 48). No reference to it was made in either document.

The complaint to the EOC:

85. Ms. Chang complained to the EOC by letter on 27 October 1997 (Doc 220). On 31 October 1997 the EOC wrote to Wyeth offering them the opportunity to respond to the complaint of discrimination on the ground of pregnancy.

86. Jackson Fong, on behalf of Wyeth, responded on 19 November 1997 (Doc 225) rejecting the allegation of discrimination. Jackson Fong characterises the meeting of 23 October 1997 at which an ultimatum to resign or be demoted had been delivered to Ms. Chang as "a discussion" in which:

"it was suggested that it might be better for the company to relieve some of her workloads and re-establish work targets which she was likely to achieve."

He went on to say that:

"the meeting was intended to be an informal and two way discussion on Ms. Chang's responsibilities and performance before the company was to reach any formal decision regarding job assignments."

87. It is difficult to imagine an more misleading description of the meeting of 23 October 1997, short of a complete denial that the meeting had ever taken place and the ultimatum delivered. In his reply to the EOC Jackson Fong apparently chose to ignore completely Richard Kwan's memo of 5 November 1997 (Doc 48), which must have been in his hands when he replied to the EOC, in which Richard Kwan had said "we persuaded Ms. Chang to resign or transfer her to a different position" and that the next morning "Ms. Chang refused to resign nor to accept job transfer, and she told Gordon (Yuen) her decision directly."

The treatment after the complaint:

88. As has been noted Richard Kwan did not respond to Ms. Chang's reply to Francesca Lui's memorandum, (Doc 47) nor did he respond to Ms. Chang's reply to him on 28 October 1997 (Doc 88). Instead, despite his concerns as to Ms. Chang's ability, on 31 October 1997 (Doc 98) he instructed her that she was to take over Francesca Lui's tasks as well as her own while Francesca Lui was on maternity leave. On 21 November 1997 (Doc 99) he instructed her that he required a written report from her updating the status of her tasks and projects each Monday by 9.00 a.m. His explanation for the requirement was that it would enable him to supervise her properly and to continue to evaluate her position. Instead of "reliev(ing) her workloads" as Jackson Fong had suggested to the EOC was being done Richard Kwan added to them.

89. The reporting requirement, specific to Ms. Chang, varied over time. From 21 November 1997 there was a requirement for weekly reports. This was relaxed to bi-weekly reports from 4 February 1998 (Doc 105), then to monthly reports from 20 July 1998 (Doc 119). Despite the fact Richard Kwan's e-mail of 4 February 1998 requiring bi-weekly reports (Doc 105) was addressed to Francesca Lui and Paul Cheung (another Product Manager), the requirement for reports was never put into effect as far as Francesca Lui and Paul Cheung are concerned.

90. Ms. Chang considered the requirement for weekly, or indeed any other such written reports, to be discriminatory as the requirement was not imposed on any other Product Manager. It is fair to say that she actively resisted the requirement and only two reports were ever produced by her (Docs 101 and 108). Despite this, no real action was taken in respect of the absence of reports. In an exchange of e-mails (Docs 102, 103, & 104) between 17 December 1997 and 16 January 1998 Richard Kwan tried to explain to Ms. Chang why he wanted the reports. She rejected his explanation stating that his claims as to her performance and work attitude were not established and could therefore not be used to justify unique treatment of her. He let the matter lie there and took no further specific action.

The second antenatal examination on 2 January 1998:

91. Ms. Chang had attended her first antenatal examination on 21 November 1997. As was the practice at Wyeth at the time. she had not made a formal application for leave but had notified Richard Kwan by e-mail on 17 November 1997 (Doc 154) of the appointment and that she would be late in following the examination. She duly arrived back at work. No complaint was made of the procedure that she had followed.

92. Her second antenatal examination was due on Friday 2 January 1998. On 31 December 1997 Richard Kwan was on leave and Ms. Chang's immediate superior was Jackson Fong. She tried, but was unable to speak to him directly to tell him of the appointment for the examination. At 12:17 p.m. she sent him an e-mail (Doc 156) about the appointment and also verbally advised the PMD secretary and another PM. She attended the examination in the morning of 2 January 1998 and returned to work in the afternoon. There was apparently nothing urgent to be dealt with and no comment was made to her about the procedure that she had followed. Jackson Fong made no contact with her, either personally or by e-mail.

93. On Monday 5 January 1998 at 11.19 a.m. Jackson Fong e-mailed Ms. Chang (Doc 156) saying that he had tried to contact her "to discuss on the OC survey on Jan 2". On Tuesday 6 January 1998 she was given a formal written warning (Doc 157) by Jackson Fong for being absent without approved leave on 2 January 1998. She was given no opportunity to explain the situation and, despite the fact that no contact had been made with her on her return on that day, no discussion took place with Jackson Fong relating to the OC survey. The written warning incorrectly said that her e-mail notification "was not received until January 2 morning". Of course, as an e-mail it was received virtually immediately it had been sent at 12.17 p.m. on 31 December 1997. It was however apparently not opened and read by Jackson Fong until 2 January 1998. There is no explanation as to why, if there was an urgent matter in relation to the OC survey to discuss, he did not discuss it with her in the afternoon of 2 January 1998 or even on 5 or 6 January 1998 before issuing the written warning. There was no explanation of the precise nature of the issue arising from the OC survey that apparently needed to be dealt with as such a matter of urgency.

94. On 7 January 1998 she lodged, by e-mail to Lawrence Woo, a formal complaint (Doc 158) about the warning from Jackson Fong. In that e-mail she set out in detail complaints about unfavourable treatment being meted out to her by Jackson Fong, Richard Kwan and Francesca Lui.

The treatment after January 1998:

95. I have dealt separately with the written warning Ms. Chang received for an unauthorised absence when she attended an antenatal examination and the reporting requirements imposed on her by Richard Kwan.

96. In January and February 1998 Francesca Lui gave tasks to Ms. Chang to do, which, on examination were largely pointless. They involved three drugs, Triphasil, Harmonet and Microval. The effect of adding these tasks to her other duties was simply to increase the burden on Ms. Chang.

97. Shirley Tang had joined the Human Resources department of Wyeth on 2 January 1998 as Human Resources manager working under Gordon Yuen. Her first involvement with Ms. Chang was to prepare the written warning to Ms. Chang following her second antenatal examination (Doc 157) signed by Jackson Fong. She was asked to investigate the situation and was asked by Richard Kwan to attend bi-weekly meetings between himself and Ms. Chang, in the role of observer.

The 1998 and 1999 salary review:

98. In 1998 Ms. Chang did not receive a salary increase. In September 1997 Jackson Fong had sent to all Department heads a memorandum requesting that they submit salary recommendations for staff. The limitation on the recommendations were that average merit increase could range from 0% to 8% and individual merit increases from 0% to 16%. Richard Kwan recommended a salary increase of 8% for Francesca Lui, 7% and 5.3% for two other PM's, 8.3% for a marketing assistant and 8% for the departmental secretary. The recommendation for the other marketing assistant was 0% but that must be seen in the light of the fact that she had only commended work at Wyeth in mid June 1997. He recommended no increase for Ms. Chang, grading her performance unacceptable.

99. In September 1998 the same exercise was repeated. This time the overall merit average was not to exceed 5% but individual increase may range up to 10%. Richard Kwan recommended a merit increase for Ms. Chang of 2.3% Two other PM's received 3% and 3.5% respectively. Lower paid staff (secretary & marketing assistants) received 3% and 4%. Richard Kwan justified the lower increase for Ms. Chang on the basis of his perception of her performance being the lowest in the PMD. In the light of his comments on her performance appraisal at the same time (Doc 57) and his allocation of a performance rating of 3.5, meaning "above competent" it is difficult to see how he could justify the lesser recommendation.

Treatment after return from maternity leave:

100. Ms. Chang went on maternity leave in May 1998 and returned to work in July. Immediately Richard Kwan undertook a review of her performance. Ms. Chang's evidence was that of the seven items reviewed he agreed that her performance met expectations and that in respect to the remaining two it was simply too early to make a rating. Notwithstanding this he required her to prepare "goals and objectives" for the second half of the year and to submit "milestones for those goals. He required a progress review in one months time. Although all PM's were required to set goals and objectives no one else was required to submit milestones or to submit to monthly progress reviews.

101. In August 1998 Richard Kwan asked Ms. Chang if she had prepared a written report for a progress review. She said that she had not and that the review could be undertaken without a written report. He accepted that verbal communication had been restored but still required a monthly report with a view to a 6 monthly review. She objected to this requirement, not imposed on other PM's, by e-mail on 26 August 1998 (Doc 120).

102. In a performance appraisal of Ms. Chang in September 1998 (Doc 57) Richard Kwan accepted that she had strong analytical skills, was good in planning and strong in communication skills. That being his view, there was plainly no longer any real reason to continue reports and regular reviews of the nature he wanted from Ms. Chang but not the other PM's.

The decision to resign:

103. Life for Ms. Chang at Wyeth had been unpleasant for a long time and did not improve after her return from maternity leave. By November 1998 she found herself in the position that other PM's avoided having lunch with her. There had been no resolution of the issues as to her treatment and the threat of dismissal or demotion had not been withdrawn but allowed to remain in the background.

104. In September 1998 the EOC agreed to fund an action against Wyeth for Ms. Chang and a letter before action was sent on 5 October 1998. Thereafter negotiations began between solicitors with the hope that the proceedings may be resolved.

105. On 4 January 1999 Richard Kwan and Ms. Chang met to discuss and set objectives for the new year. Ms. Chang had prepared a memorandum of her objectives and the weight to be attached to each (Doc 211). There was a difference of opinion as to the weighting to be placed on sales volume. Richard Kwan wanted to allocate a weighting of 70%. Ms. Chang knew that other PM's had a weighting of 40%. He sought also to reduce a budget item by 75% to a level which Ms. Chang considered would make it impossible to achieve the related sales target. There was a verbal dispute between them in which accusations were traded and he accused her of making a personal attack on him. She left the meeting saying that there was no point in going on and that she would submit a revised assessment of the weighting and if they could not agree they should take it up with the Human Resources Division.

106. On 2 February 1999, nearly a month later Richard Kwan sent Ms. Chang a memorandum (Doc 212) reviewing the dispute and informing her that if she was rude to him again he would recommend appropriate action to the management. In that memorandum he said that she had accused him of "waiting to eat rice", a literal translation of an extremely deprecatory colloquial Chinese expression which means one who just sits around at work collecting pay and doing nothing.

107. Ms. Chang replied by e-mail on 8 February 1999 (Doc 214), not surprisingly asking first why he had waited nearly a month to write the memorandum. She said that the memorandum did not truthfully reflect the conversation they had together on 4 January 1999. After setting out various matters which demonstrated the difficulties he was creating for her she accused him of making a commission agreement with a wholesaler that was in breach of the authorised terms upon which commissions could be offered. She copied this e-mail to Lawrence Woo and to persons in the US head office. The accusation was serious, potentially one of criminal behaviour on Richard Kwan's part.

108. I am satisfied on the evidence that there was no basis for that accusation, but that it was made by Ms. Chang wrongly and out of frustration at the continued attempts by Richard Kwan to make life difficult for her and to leave a paper trail that did not truly reflect the events that had taken place. She was quite wrong to make that unfounded accusation. She received no reply to her e-mail Doc 214. At the same time I am satisfied that in the meeting she did not accuse him of "waiting to eat rice". Had she done so I have not the slightest doubt that Richard Kwan would have responded in writing immediately taking appropriate steps in relation to insubordination, and not waited for a month to raise what by then had become a stale issue.

109. At the end of February 1999 there was a business review meeting held in Shanghai with senior executives from Wyeth's parent company in the US. All PM's except Ms. Chang were invited to attend. A further similar review meeting took place in Shanghai on 18 June 1999. Again Ms. Chang was not invited to attend. Negotiations with Wyeth's solicitors to resolve the complaint to the EOC had by that time been proceeding for nine months with no result.

110. Ms. Chang had now reached the point where she could no longer feel able to work at Wyeth. It was plain that her career in Wyeth had effectively ended and that she could expect no further advancement. Her omission from the Shanghai Business Review meeting made it plain to her that, effectively, she was sidelined. She was working in a most unpleasant and strained atmosphere.

111. She gave notice and resigned on 28 July 1999. For some time prior to 1997, like many Hong Kong citizens who were apprehensive about the prospects for Hong Kong following China's resumption of sovereignty, Ms. Chang and her husband had been exploring the possibility of emigration. They had been granted permission to emigrate to Australia in July 1996. They landed in Australia for 9 days in October 1996, a step essential to maintaining the right to emigrate until July 2000.

112. Her evidence, which I accept, was that they did not want to go to Australia, and, had her career with Wyeth not ended as it did, she would not have emigrated. Hong Kong was her home and with no serious issues affecting a citizen's life style in Hong Kong arising after 1997 she and her husband, like many others in the same position, were happy to let such rights lapse. However she found it difficult to get other work after leaving Wyeth ultimately finding a job which required a lot of travel. This had a very detrimental effect on her family life. Eventually in July 2000 she and her family emigrated to Australia.

Evaluation of the conduct of Wyeth:

113. An evaluation of the actions of Wyeth must to be undertaken in the light of seven key facts. They are first, the fact that Jackson Fong disliked Ms. Chang; second the virtual absence of any record expressing concern as to her conduct; third, the memorandum of 7 October 1997 to Ms. Chang concerning her entitlement to maternity leave (Doc 13); fourth the imposition of the ultimatum on 23 October 1997 without any prior warning; fifth, Richard Kwan's statement on 28 October 1997 to Ms. Chang that an evaluation would be bad for her baby; sixth, Jackson Fong's deliberately misleading written response to the EOC on 19 November 1997, and seventh, Jackson Fong's response to Ms. Chang's absence at her second antenatal examination by way of written warning (Docs 156 & 157).

114. The fundamental reason for the situation faced by Ms. Chang in September 1997 may well have been best expressed by Lawrence Woo in his meeting with Ms. Chang and Shirley Tang on 13 January 1998. He told Ms. Chang that the whole matter boiled down to an issue of personal working relationships. In this respect Shirley Tang did not challenge Ms. Chang's evidence. It is clear that Jackson Fong had expressed his dislike of Ms. Chang to Richard Kwan. It is equally clear, with hindsight, that the different working styles of Ms. Chang and Francesca Lui made them unsuitable to work together in the manner anticipated by the May 1997 reorganisation of the PMD.

115. But is also equally clear that in September and October 1997 the situation was not such as to warrant, without any prior warning, the ultimatum to resign or be demoted that was given to Ms. Chang on 23 October 1997. The explanation offered by Wyeth, that the ultimatum was justified on the grounds of her performance is simply unsubstantiated by both the contemporaneous documents and the oral evidence. Only one document, Francesca Lui's e-mail to Richard Kwan existed, dated 23 July 1997 (Doc 43), which contained any real criticism of Ms. Chang. That view had never been communicated to her and in fact had not been pursued by either Jackson Fong or Richard Kwan at the time it was raised. By September 1997 it was effectively a dead letter. It is right that a number of matters, including the OC telephone hotline and the Premelle and Prenatol matters, the WHO circular and the hysterectomy advertorial, were raised by Wyeth in support of Richard Kwan and Francesca Lui's assertions of Ms. Chang's incompetence, but they can be seen to be either so minor as to not matter or not even to have been perceived as a problem at the time they occurred. The great bulk of the criticisms made of Ms. Chang, both for her actions before and after the ultimatum, can be seen as being either nit-picking, or facts being deliberately twisted by Richard Kwan to justify a criticism of Ms. Chang to support his position.

116. While the fundamental reason for the situation was a breakdown in working relationships, the position taken by Jackson Fong and Richard Kwan over Ms. Chang's maternity leave and expressed in Doc 13 was clearly a deliberate decision based upon the fact of her pregnancy. Having regard to the fact that there was at least eight months to go before she would take maternity leave, and the complete absence of an explanation as to why they needed to know there and then when she would take that leave, the terms of the memorandum and the threat it contained were quite unjustified. The conversation evidenced by Iris Leung was a conversation between two men, Jackson Fong and Richard Kwan, in respect of an employee they did not like. In that conversation they decided to take a deliberate step, based upon her pregnancy, to put pressure on her.

117. Following that, on 23 October 1997 the ultimatum was given to Ms. Chang to resign of be demoted. There was no proper justification for that ultimatum in terms of Ms. Chang's performance. Coming as it did, in the context of the attitude's of Jackson Fong and Richard Kwan, the inference plainly arises that Ms. Chang's pregnancy was a factor they were taking into account. They have given no other satisfactory explanation for their conduct. I am satisfied that the pregnancy was a factor in their decision to give Ms. Chang the ultimatum.

118. That that was so is borne out by Richard Kwan's admitted statement to Ms. Chang that an evaluation of her conduct would be "bad for her baby". The logic in the statement was not explained. It is a statement that simply makes it plain that the fact of her pregnancy was high in the minds of both Jackson Fong and Richard Kwan when they took the decision to require her to resign. It is telling evidence that they took the fact of the pregnancy into account in making the decision to require her to resign or be demoted.

119. It was Francesca Lui's evidence that the pregnancy was a factor in transferring Ms. Chang to the position of marketing assistant. She said it would relieve work pressure on Ms. Chang. Although she denied discussing that particular view with Richard Kwan she agreed that they had discussed her pregnancy in the context of asking Ms. Chang to resign. I am left with no doubt that both Richard Kwan and Jackson Fong were taking into account Ms. Chang's pregnancy in the decision to present her with the ultimatum.

120. There was nothing in the evidence upon which it could be said that the ultimatum given to Ms. Chang on 23 October 1997 was justified. Prior to 18 September 1997 nothing had been raised directly with her. In his report to Jackson Fong on 5 November 1997 (Doc 48) Richard Kwan asserted that Ms. Chang's performance had improved since the meeting with Francesca Lui on 18 September 1997. He was unable to refer to any matter between 18 September 1997 and 23 October 1997 which would justify dismissal or demotion. In the absence of any satisfactory explanation or reason the only inference that can be drawn from the whole of the circumstances is that because they did not like Ms. Chang, they choose to take advantage of her pregnancy to remove her.

121. The deliberately misleading response offered by Jackson Fong in his letter of 19 November 1997 (Doc 225) to the EOC was quite unexplained. In the absence of any explanation the only inference open is that he fully appreciated the situation and hoped that by misleading the EOC the matter would go away. It was inevitable that his concern over Wyeth's situation in relation to the complaint lead him to his future conduct in relation to Ms. Chang.

122. This was demonstrated by his response to her absence on 2 January 1998 at her second antenatal examination. In the light of the usual practice of pregnant women at Wyeth taking informal leave for an antenatal examination and the complete failure to explain what was so urgent at the time of the second antenatal examination, Jackson Fong's written warning to Ms. Chang on 6 January 1998 (Doc 157) can be seen simply as an angry reaction to her complaint to the EOC.

123. The attitude of Jackson Fong and Richard Kwan towards Ms. Chang, predicated as it was by these seven key factors, continued until her resignation. To adopt Ms. Chang's words, they continued to treat her as "a problem staff". The ultimatum was never formally withdrawn. At no stage was Ms. Chang told that she was free of the spectre of dismissal or demotion.

124. I accept that there was no company culture of prejudice against pregnant employees. Quite to the contrary, Wyeth offered additional benefits by way of cheap access to its products to pregnant employees and mothers of babies. While a joke made by Jackson Fong at the mid-year meeting at Mission Hills in July 1997 about women staff at Wyeth being pregnant was both inappropriate and offensive, I accept that it does not demonstrate a general prejudice on his behalf towards pregnant employees. I accept there were other pregnant employees at Wyeth who were not subjected to the same less favourable treatment as Ms. Chang. But no inference can be drawn from either the joke or the treatment of other pregnant employees that therefore Jackson Fong and Richard Kwan did not have, as one of their reasons for their conduct towards Ms. Chang, both the fact of her pregnancy and the fact of her complaint to the EOC.

Findings as to Liability:

125. For the foregoing reasons I am satisfied that the fact of Ms. Chang's pregnancy was a reason for the decision to require her to resign or to be demoted. Jackson Fong and Richard Kwan knew that she was pregnant and saw the pregnancy as a factor that would, in their minds, ensure that an employee who was otherwise a satisfactory employee, but one whom they did not like, would be more likely to leave the company. One of the reasons they decided to give the ultimatum they gave to Ms. Chang was that she was pregnant. I infer that they expected that, as she was pregnant, she would prefer to resign to be with her child. The ultimatum of 23 October 1997 was therefore a discriminatory act.

126. I am satisfied that the fact of Ms. Chang's pregnancy, and her subsequent complaint to the EOC were part of the reasons held by Richard Kwan and Jackson Fong for the decision to impose upon Ms. Chang reporting requirements which were not imposed on other employees. The imposition and maintenance of the reporting requirements were discriminatory acts.

127. I am satisfied they would not have treated an ordinary employee, the appropriate comparator, in the same manner. I am satisfied from Iris Leung's evidence that such an employee, if considered to be under-performing, would have been informed of the situation and proper steps put in place to allow a period for proper evaluation and rectification before dismissal or demotion action was taken. The action belatedly taken in establishing an evaluation procedure with Shirley Tang in January 1998 was flawed as it proceeded on the wrong assumption that Ms. Chang's conduct had been such as to warrant an ultimatum to resign or be demoted. The whole basis of the action to require resignation was never properly examined, and could never have been properly examined so long as Jackson Fong and Richard Kwan refused, as they did, to accept that their action may not be justified. I reject the assertion that their actions were motivated purely by reason of Ms. Chang's conduct as an employee.

128. I am further satisfied that the written warning given by Jackson Fong on 6 January 1998 to Ms. Chang following her second antenatal examination was motivated purely by the fact of her complaint to the EOC. The written warning for absence given on 6 January 1998 was an act of victimisation.

129. Having regard to the complete lack of justification as to her poor conduct, and her I am satisfied that the reason for the denial of a salary increase to Ms. Chang in 1998 was the fact of her complaint to the EOC. Richard Kwan's denial of a salary increase for Ms. Chang in 1998 was an act of victimisation. I am unable to say that the difference in salary increase for 1999 from the other PM's is such that it could be attributed to a discriminatory motive.

130. I am satisfied that the whole treatment of Ms. Chang was such as to entitle her to treat herself as being constructively dismissed and that she was accordingly entitle to resign as she did in July 2000.

131. I accordingly hold that Wyeth has unlawfully discriminated against Ms. Chang by reason of her pregnancy and unlawfully victimised her by reason of her complaint to the EOC.

132. It is now necessary to consider questions of damages, other relief and costs. I direct that the parties shall appear before me, in Court, at 9.30 a.m. on Wednesday 21 May in order to fix a date for the continuation of the hearing and to deal with any other procedural matters that might arise from this judgement.