Chan Siu Ming and Others v. Kwok Chung Motor Car Ltd

[English Translation – 英譯本]
HCLA 37/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 37 OF 2006

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO. 899 OF 2006)

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Before: Hon Yam J in Court

Date of Hearing: 19 November 2007

Date of Judgment: 19 November 2007

Date of Reasons for Judgment: 11 January 2008

REASONS FOR JUDGMENT

1.Whether a worker is an employee or a self-employed worker is a frequently argued legal issue.  An employee enjoys protection under the Employment Ordinance (Cap. 57 of the Laws of Hong Kong) and, if he is injured at work, is entitled to all the benefits conferred by the Employees’ Compensation Ordinance (Cap. 282 of the Laws of Hong Kong).

2.The Privy Council elaborated on the above issue in Lee Ting Sang v. Chung Chi Keung [1990] 2 AC 374.  In Hong Kong, the Court of Final Appeal dealt with the same issue in its landmark judgment in Poon Chau Nam v. Yim Siu Cheung [2007] 1 HKLRD 951.

3.The present appeal involves all the claimants, who were held by the Labour Tribunal to be self-employed persons rather than employees.  The 2^nd, 5^th, 8^th and 10^th claimants, who have been granted legal aid, are represented by Mr Ng of Counsel in the present appeal.  The grounds of appeal and submissions made by Mr Ng are no doubt also applicable to the other appellants/claimants.

BACKGROUND

4.The appellants/claimants were drivers of green minibuses of a franchised route.  They claimed to have been employed by the respondent Kwok Chung Motor Car Limited (“the Company”).  They claimed against the Company for annual leave pay and statutory holiday pay on the ground that they were employees rather than self-employed independent contractors.  The 1^st, 3^rd, 5^th, 6^th, 9^th and 10^th claimants also claimed severance pay, or alternatively, long service payment, as they had been working for the Company for more than 5 years.

5.The Company, on the other hand, contended that all the claimants were self-employed persons.

6.Mr George Own, Deputy Adjudicator of the Labour Tribunal (as he then was), held on 31 July 2006 that all the claimants were self-employed persons rather than employees, and hence dismissed their claims.

7.It must first be noted that the Adjudicator based his ruling on the Court of Appeal’s judgment in Poon Chau Nam, which was, however, subsequently overturned by the Court of Final Appeal on 13 March 2007.  The Deputy Adjudicator did not have the benefit of the Court of Final Appeal’s judgment when he made his ruling.

BACKGROUND

8.The following undisputed facts can be gathered from the collective testimony of the appellants:

(1)   (a)   The various claimants joined Kwok Chung Motor Car Limited between 1995 and 2003, working as night-shift minibus drivers and serving the franchised route 805S which plied between Mongkok and Ma On Shan;

(b)   They all signed a number of “vehicle rental agreements” with the Company, driving the minibuses as self-employed persons;

(c)   In December 2005, they signed “employment contracts” with the Company instead and continued to drive in a different capacity, namely as employed drivers.  The arrangement came into effect on 3 January 2006; and

(d)   During the material period, they never mentioned to or raised the issue with the company that they were in fact employees.  Nor did they claim any employee’s benefits;

(2)        Between 10:30 p.m. and 11:30 p.m. every night, pursuant to the instructions of the Company, the claimants had to collect their minibuses at Lee On Estate, Hin King Estate and Kwong Yuen Estate and then drive the minibuses to the Mongkok terminus where they would line up and wait for passengers;

(3)        The claimants’ remuneration was calculated as follows: If the fare income for the night was $200 or less, the remuneration would be the fare income minus $144; if the fare income exceeded $200, the remuneration would be 28% of the fare income (but all the claimants said that the fare income had never been less than $200 per night because the income from one single trip already exceeded $200); and

(4)        The claimants were paid their remuneration by the Company twice a month, i.e. on the 5th and 20th day of each month.

LEGAL PRINCIPLES

9.In Lee Ting Sang, Lord Griffiths had this to say (382D-G):

[The Lordships] agree with the Court of Appeal when they said that the matter had never been better put than by Cooke J. in Market Investigations Ltd. v. Minister of Social Security [1969] 2 Q.B. 173:

…The fundamental test to be applied is this: ‘Is the person who has engaged himself to perform these services performing them as a person in business on his own account?  If the answer to that question is ‘yes’, then the contract is a contract for service.  If the answer is ‘no’, then the contract is a contract of service.  No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of the considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases.  The most that can be said is that control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors which may be of importance are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task.

10.The above case sets out six factors to be considered:

(1)        control;

(2)        equipment;

(3)        freedom to hire his own helpers;

(4)        financial risk;

(5)        degree of responsibility for investment and management; and

(6)        opportunity of profiting from sound management.

11.In Poon Chau Nam, Ribeiro PJ observed (at 959-960, paragraphs 15-17) that the two English decisions were very influential to the question of establishing the existence (or otherwise) of an employer-employee relationship. And in paragraphs 17-18, Ribeiro PJ said (citing Market Investigations Ltd v. Minister of Social Security [1969] 2 QB 173):

[Market Investigations Ltd] earned the Privy Council’s accolade in Lee Ting Sang v. Chung Chi Keung & Another, where Lord Griffiths stated that their Lordships ‘agree with the Court of Appeal when they said that the matter had never been better put by Cooke J. in’ that case …

The modern approach to the question whether one person is another’s employee is therefore to examine all the features of their relationship against the background of the indicia developed in the abovementioned case-law with a view to deciding whether, as a matter of overall impression, the relationship is one of employment, bearing in mind the purpose for which the question is asked … (Emphasis provided)

APPLICATION OF THE ABOVE LEGAL PRINCIPLES TO THE FACTS OF THE PRESENT CASE

12.For the reasons to be set out below, I accept the submission of the appellants/claimants that they have clearly established on the undisputed facts that they were employees of the Company rather than independent contractors:

(i)      Control

13.On this issue, the control of the company over its employees is always an important factor.  As Cooke J said, “control will no doubt always have to be considered.”

14.In this respect, the claimants said this in their collective testimony:

Control: The Company exercised a very high degree of control over us.  Applications for leave must be submitted at least three days in advance. The drivers’ weekly restdays were also arranged by the Company after theysubmitted their applications; in addition, the time and placefor collecting vehicles were designated by the Company.  Furthermore, the so-called ‘vehicle rental agreement’ we signed some years ago expressly provided that drivers must absolutely abide by the Company’s instructions on the route, scheduleand travelling time, and that the drivers could not allow any other person to drive the minibuses without the consent of the owner.  The Company had even drawn up a ‘Code of Practice for Professional Minibus Drivers’ and required the drivers to abide by the eight requirements laid down in the Code.  The above facts clearly show that the Company exercised a very high degree of control over us. (Emphasis provided)

15.The Adjudicator held in his Reasons for Ruling that the guidelines on “control” were “not applicable to the business of the green franchised minibuses” (see paragraph 22).  His reasons are set out as follows:

…. as the ‘route operators’ or ‘licensees’ in this business have to operate in accordance with the requirements and provisions laid down by the Transport Department when it granted the franchise, there is no question of their exercising control over the drivers on such matters as routes and schedules.  If this guideline is applied to the green franchised minibus business in considering whether an employment relationship may exist between the operators and the drivers, it will constitute unfairness and a departure from the objective facts. …

16.I agree with the claimants’ submission that the Adjudicator’s reason for not taking into account the factor of control is far-fetched.

17.It is widely known that “route operators” or “licensees” in the green franchised minibus business have to operate in accordance with the requirements and provisions laid down by the Transport Department when it granted the franchise.  The consequence is that a “route operator” or “licensee” who engages drivers who are independent contractors to drive on the routes operated by the “route operator” will have to require the drivers to strictly abide by the requirements.  However, this does not mean that there is no need to consider the issue of control over the drivers by the “licensee”.  Otherwise, as the claimants have submitted, all the franchised buses such as Kowloon Motor Bus, Citybus and New World First Bus (commonly called the “big buses”) would not have to consider the issue of control in assessing whether their drivers were employees simply because they must operate in accordance with the routes and schedules specified by the Transport Department when it granted the licence (I should point out here that I find it difficult to imagine how drivers of big buses can also operate as self-employed persons).  I agree with the claimants’ submission that the Adjudicator’s reasoning was putting the cart before the horse.  For this very reason, perhaps as a result of stringent statutory requirements that govern certain industries, the licensee will in turn impose stringent requirements on the operator, which will then render it difficult for the operator to operate as a self-employed person.    

18.Furthermore, the following undisputed facts indicate that the Company did exercise a very high degree of control over the claimants’ work:

(1) The drivers’ weekly restdays were arranged by the Company after they submitted their applications.

(2) The drivers had to submit their leave applications to the Company at least three days in advance.

(3) The time and place at which the drivers collected their vehicles were designated by the Company.

(4) The Company required the drivers to comply with the eight requirements set out in the Code of Practice.

19.In addition, it was not the case, as Mr Wu for the Company submitted, that:

… the ‘rental agreement’ did not stipulate the number of days for which a driver must rent a vehicle in a month, [hence] a driver could decide for himself the number of days per month for which he would rent a vehicle.

On the contrary, the evidence reveals that, apart from their weekly restdays, the drivers were basically not allowed to take leave (see pages 131I-K, 133P, 134O-S and 135D-L of the transcript of the audio recording of the hearing, where the 1^st claimant gave evidence in response to the Adjudicator’s questions).  If the drivers fell sick, they had to inform the station captains who would then make all necessary arrangements (see page 155G-P of the transcript of the audio recording of the hearing, where the 2^nd claimant was cross-examined by Counsel for the Company).

20.As for the Company’s allegations that “the drivers of the rented vehicles were not completely controlled by the station captains” and that “they decided for themselves when to have meal breaks”, they are merely evidence given by witnesses for the Company, and the Adjudicator has not made any findings of fact in that respect.  On the other hand, according to the “Code of Practice for Drivers of Minibuses for Franchised Routes”, the drivers “have to comply strictly with the instructions of the station captains of this Company”.

21.In my judgment, the company exercised a very high degree of control over the drivers’ work, and this clearly points to the existence of an employment relationship between them.  The Adjudicator has erred in law by finding that, having regard to the circumstances under which the business of the green franchised minibuses was operated, the factor of control was not applicable to the business.  The appellants’ appeal can be allowed on this ground alone.  However, the following factors also clearly show that the drivers were employees of the company rather than drivers operating independently.

(ii)     Whether the claimants provided their own equipment

22.The claimants stated in their collective testimony that:

Equipment for work: The vehicles were owned by the Company, which was also responsible for their maintenance.  The drivers had to go to the Shell petrol station in Ma On Shan, which was designated by the Company, for petrol refill, and make payment using the petrol cards provided by the Company.

23.The Deputy Adjudicator also held that the claimants did not provide any equipment, and then went on to say (in paragraph 23):

The evidence shows that the claimants did not have to provide any equipment and that they earned their remuneration purely with their labour …

This particular factor should have indicated that the drivers were employees as opposed to contractors.

24.However, the Adjudicator went on to say:

… this notwithstanding, it cannot be concluded for this reason that the drivers must be employees or could or could not possibly work in a self-employed capacity.

25.Why not?  The Adjudicator did not give any elaboration.  For no reason, he failed to give any weight to this factor.  In my view, this was another mistake in law which caused him to conclude that the drivers were merely contractors.

(iii)    Can they hire helpers?

26.The claimants said in their collective testimony:

Helpers: We could not hire any helpers or substitute workers at all.  All the substitute workers were arranged by the Company.

27.The Adjudicator also held (in paragraph 24) that:

…. according to the evidence and the terms of the vehicle rental agreements, the drivers could not of their own accord decide to hire helpers to drive for them in order to earn remuneration …

28.However, the Adjudicator went on to say:

…. but I believe it is also necessary to consider the factual circumstances objectively.

29.What, then, were the “factual circumstances” which led to the Adjudicator’s refusal to consider this factor (i.e. that the drivers could not of their own accord decide to hire assistant drivers to help them earn remuneration) in determining whether the drivers were employees or contractors?  The Adjudicator provided an explanation in paragraphs 25 and 26 of his Reasons for Decisions, which is set out below:

… ‘considering the matter from the perspective of vehicle insurance’ and ‘from the perspective of public safety’ … if the drivers could decide for themselves to hire helpers and the helpers met with traffic accidents in the course of  work, it would certainly have a bearing on the vehicle owner’s liability and on insurance compensation.

30.I accept the claimants’ submission that the above observation is also putting the cart before the horse.  If the Company unequivocally accepted and regarded the drivers as self-employed persons, then the drivers as such should be entitled to decide whether or not to hire helpers in the performance of their contracts.  As long as the Company laid down requirements on the identity and standard of skill of the helpers, the drivers should be free to decide when to perform the work by themselves and when to hire people who were accepted by the Company as helpers, and also make the necessary insurance arrangements.  By so doing, vehicle insurance and public safety would have been thoroughly considered and taken care of.  However, the Adjudicator once again refused to take this factor into consideration although he acknowledged that it did exist.

(iv)    Financial risk

31.On the issue of financial risk, the claimants said in their collective testimony that:

Financial risk: Our daily wages were calculated on an income-sharing basis, and there was no risk of losing money.

The Adjudicator also accepted and “agree[d] that, given the basic rental of $144, there should not be any risk indeed …” (paragraphs 27 and 28).

32.However, the Adjudicator then proceeded to consider “the opportunity of profiting from sound management” and found that the claimants’ “remuneration on an income-sharing basis would be reduced by slow traffic or bad weather” and that this was tantamount to a “financial risk”.

33.I accept the claimants’ submission that “all piece-rated workers are remunerated on the basis of the quantity of work done” (see paragraphs 13-14 of the judgment of Deputy High Court Judge KY Chan in Chow Yuk Ho and Li Yin Ho t/a Sunny & May Fashion Design, HCLA 6/2005, 6/10/2005).  Hence, the fact that “the remuneration on an income-sharing basis would be reduced by slow traffic or bad weather” was not the same as financial risks of losing money due to poor performance in investments or business.  The remuneration was simply the result of “work more, earn more” and would be reduced by bad weather which decreased the quantity of work.  This was not a financial risk associated with investment losses or business deficits.

(v)     Responsibility for investment and management

34.The claimants said in their collective testimony that:

We did not have any responsibility for investment and management; we knew little about the financial policies of the Company and were not involved in the management of the business of the fleet of vehicles.

The Adjudicator took the view that:

The guideline itself leaves no room for consideration in respect of the job of the drivers, and hence there is no need to canvass this factor … (see paragraph 34)

35.This factor should in fact have been taken into account, and it should have indicated that the drivers, who had no responsibility for investment and management, were merely employees.

(vi)    Whether they were part of a business organization

36.According to the claimants’ collective testimony:

We were hired by the Company and, as employees, became members of our employer’s business organization.  We had not obtained any business registration.

37.The Adjudicator held (in paragraphs 35 and 36) that:

The claimants claim that they did not participate in the management of the defendant company’s business and they simply earned their remuneration (i.e. what they have described as ‘wages’) with their manual labour, and hence they were not members of a business organization …

In my view, the fact that they did not participate in the operation of the business or did not obtain business registration does not mean that the alleged employees could not provide services as self-employed persons. …

38.The above finding of fact by the Adjudicator is plainly in stark contrast to the claimants’ case that they were members of the Company’s business organization.  The Adjudicator held that they were not members of the business organization as they did not participate in the operation of the Company’s business, and this led to the Adjudicator’s conclusion that they were self-employed persons.  As they have submitted, however, the drivers were in fact members of the Company’s organization, and this indicates that they were employed the Company as drivers.

(vii)   Whether they were operating the business

39.The claimants’ collective testimony said that:

We only provided manual labour services to the business activities of Kwok Chung Motor Car Limited and were not operating Minibus services on our own account during the material period.

This clearly shows that the claimants were employees rather than contractors.  However, the Adjudicator dealt with this factor in conjunction with item (vi) and came to the conclusion that the drivers were independent contractors — a conclusion which, with respect, I find it difficult to understand.

(viii)  The views of both parties on their relationship

40.According to the claimants’ collective testimony:

The views of both parties: We had always regarded ourselves as employees of the Company.  Although we had all along been asked by the Company to sign the vehicle rental agreements, we do not think the agreements reflect our true capacity.

41.The Adjudicator said in paragraph 41 of his Reasons for Decision:

The undisputed fact is that C1 to C13 had on more than one occasion signed the ‘vehicle rental agreements’, which provided in simple and plain Chinese that no employment relationship existed between the parties. …

This suggests that throughout the case the Adjudicator appeared to have focused on the label of “vehicle rental agreement”.  However, at law this sort of labelling is not the paramount consideration in determining the relationship between the parties.  Indeed, it has repeatedly been pointed out in cases before the Court of Final Appeal and other courts that such labelling is not a major consideration.  This is also the view taken by the claimants in their collective testimony.  In determining their true capacity, the court primarily has to look at how the relationship between the parties operated.

42.In Poon Chau Nam, Ribeiro PJ observed (at 974, paragraphs 58-59) that:

This was also the approach in Young & Woods Ltd v. West where the claimant had freely opted for self-employed terms but when dismissed, was allowed to resile from that choice and to sue for unfair dismissal because he had objectively entered into an employment relationship.  Stephenson LJ stressed that it was ‘the court’s duty to see whether the label correctly represents the true relationship between the parties’for to do otherwise would be ‘to presuppose some kind of estoppel against invoking the statute equivalent to, or closely analogous to, a power to contract out of the Act; and to give effect to it would, in my judgment, be plainly wrong.’ And as Sir David Cairns stressed:

… it is [of] great importance as a matter of public policy that an employer should not be able to avoid his statutory responsibilities as an employer — responsibilities for safety, redundancy payments, compensation for unfair dismissal and other matters — by offering to those who are, or are about to become, in substance employees a form of contract purporting to put them in another category and offering tempting fiscal advantages.

The Hong Kong Court of Appeal has expressed similar sentiments in Chan Kwok Kin v. Mok Kwan Hing & Another, where Clough JA stated:

It was for the court and not the applicant to evaluate the facts and determine the legal relationship of the applicant to the first respondent.  The applicant no doubt knew who he was working for, namely the first respondent, but in all the circumstances we think his classification of their legal relationship and of his legal relationship with Law can have no significant evidential value.

43.As Mr Ng for the appellants has pointed out, this widely-accepted legal principle has been adopted by courts of different levels.  In Mak Kai Wing (麥啟榮) v. Express Top Industries Ltd & Others, HCLA 93/2004, 29/11/2004, Lam J said (in paragraph 7 of his judgment):

… it is trite law that the label in the contemporaneous documentations, although relevant, is not conclusive. …

(ix)    Mandatory Provident Fund

44.The Adjudicator found that seven of the claimants “had opened their own MPF accounts as self-employed persons” (see paragraph 42 of the Reasons for Decision).  He then relied on the Court of Appeal judgment in Poon Chau Nam (in particular paragraph 51) and held that “how the two parties view their relationship is a very important consideration”.

45.However, in Poon Chau Nam, Ribeiro PJ observed (in paragraphs 56 and 57) that:

Woo V-P’s concern was therefore that failure to give effect to the parties’ expressed intention that the appellant should be treated as self-employed (and therefore outside the coverage of the ECO) would unjustly result in the respondent being saddled with unexpected criminal liability for non-compliance with ECO obligations which are owed to employees but not to self-employed persons.  This sentiment comes close to suggesting that the parties should be accorded freedom to contract out of the ECO, a proposition which would run counter to s.31(1):

Any contract or agreement whether made before or after the commencement of this Ordinance, whereby an employee relinquishes any right to compensation from an employer for personal injury by accident arising out of and in the course of his employment, shall, subject to sub-s. (2), be null and void in so far as it purports to remove or reduce the liability of any person to pay compensation under the provisions of this Ordinance.

If, on the facts viewed objectively and applying the indicia of employment discussed above, the person injured is properly to be regarded as an employee, the ECO applies and any agreement seeking to remove that person from its scope is void.  … if there is objectively an employer-employee relationship, the compulsory statutory duty which the employer bears cannot be overridden by the express stipulation of the parties. …

46.Furthermore, in arriving at his conclusion on the effect of the label, the Adjudicator also sought to rely on the following observation of Tang VP in Lui Lin Kam v. Nice Creation Development Ltd [2006] 3 HKLRD 655 (in paragraph 38 of his judgment):

… I am concerned with the legal rights of the parties and not with the morality of such a practice.  No doubt many employers will be guided by their self interest and they would wish to employ their employees on a long term basis for the sake of good morale and loyalty.  But provided an employer was acting within the law, he is also entitled to the full measure of the law.

47.However, the issue in Lui Lin Kam involved the “continuous” employment relationship under section 3 of and Schedule 1 to the Employment Ordinance: namely, if there was an employment relationship, had the continuity of that relationship been broken by the successive 18-month contracts?  Hence, the judgment in that case is simply irrelevant to the issue now being dealt with.

Estoppel by convention

48.Finally, the Company relies on the legal principle of “estoppel by convention” and submits that as both parties had presumed and acknowledged that no employment relationship existed between them, they should be bound by the agreement.  Nevertheless, the label cannot serve to convert what is basically an employment relationship into an independent self-employment, which also goes against the spirit of the Employment Ordinance.  As Megaw LJ observed in Ferguson v. Dawson & Partners [1976] 1 WLR 1213 at p. 1223:

… The parties cannot transfer a statute-imposed duty of care for safety of workmen from an employer to the workman himself merely because the parties agree, in effect, that the workman shall be deemed to be self-employed, where the true essence of the contract is, otherwise, of a contract of service.

49.Accordingly, the legal principle of “estoppel by convention” does not apply to the statutory rights of a party to the contract.  As Viscount Radcliffe stated in the Privy Council case of Kok Hoong v. Leong Cheong Kweng Mines Ltd [1964] AC 993 at p.1015:

The respondent has invoked in support of its defence a principle which appears in our law in many forms, that a party cannot set up an estoppel in the face of a statute.  Thus a corporation upon which there is imposed a statutory duty to carry out certain acts in the interest of the public cannot preclude itself by estoppel in pais from performing its duty and asserting legal rights accordingly.  See Maritime Electric Co. Ltd v. General Dairies Ltd and Southend-on-Sea Corporation v. Hodgson (Wickford) Ltd.  Given a ‘statutory obligation of an unconditional character’ it is not open to the court to allow the party bound by that obligation to be barred from carrying it out by the operation of an estoppel.  Similarly, there is, in most cases, no estoppel against a defendant who wishes to set up the statutory invalidity of some contract or transaction upon which he is being sued, despite the fact that by conduct or other means he would otherwise be bound by estoppel: see In re Bankruptcy Notice, in particular per Atkin L.J.

50.This is in line with the provision in section 70 of the Employment Ordinance, which forbids anyone from extinguishing or reducing by means of contractual terms the rights conferred by the Ordinance.

CONCLUSION

51.Mr Ng for the appellant cites the case of Poon Chau Nam as an example and relies on the following remarks of Ribeiro PJ inthat case(at 971, paragraph 53).  Mr Ng replaces the phrase “the air-conditioning business” with “the green public light bus” and urges me to reach the same conclusion in the circumstances of the present case:

[The green public light bus] belonged to the respondent. …  The respondent decided which, if any, jobs should be assigned to the appellant and paid him to do them at the daily rate of $550, plus any overtime.  All the profits and losses of the business were for the respondent’s account.  The appellant bore no financial risks and reaped no financial rewards beyond his daily-rated remuneration.  The respondent managed the business and hired several other workers, some of whom would sometimes work alongside the appellant on a job.  The appellant personally did the work assigned to him.  He did not hire anyone to help.  Travel expenses incurred in the course of the work were borne by the respondent who sometimes drove the appellant to the work site in his van, particularly where heavy equipment had to be transported there.  Such equipment was owned by the respondent and not the appellant.  Whenever items had to be purchased by the appellant for work purposes, he was reimbursed by the respondent, even where the amounts were very small … the other indicia all point clearly to an employer-employee relationship entered into for each specific engagement.  The main difference between the appellant and the other workers was that his employment was of a casual nature whereas theirs was permanent and paid on a monthly basis.

52.I accept the appellants’ submission that the undisputed facts of the present case indicate beyond doubt that an employment relationship existed between the parties.  As Ribeiro PJ observed in Poon Chau Nam (at 971, paragraph 52):

… the only reasonable conclusion to be reached on the undisputed facts is that, … the appellant was working for the respondent under a contract of service …

53.Therefore, I accept that the relationship between the parties was one of employer-employee.  The Adjudicator ruled that the drivers were self-employed persons, but as Ribeiro PJ pointed out (at 962, paragraph 22):

… a finding that an employer-employee relationship does or does not exist can only be interfered with on appeal if it can be shown that the tribunal misdirected itself in law or came to a decision which no tribunal, properly directing itself on the relevant facts, could reasonably have reached.

I am satisfied that the present case falls within the situation envisaged by Ribeiro PJ.

54.For the above reasons, I allow the appellants’ appeal.  However, as the parties agree that different amounts should be awarded to different claimants, and this matter cannot possibly be resolved after an adjournment, the parties have agreed to remit the issue of the quantum of the claims to the Labour Tribunal for determination by another adjudicator.  The appellants are of course to be awarded costs to be taxed if not agreed.  Costs of the 2^nd, 5^th, 8^th and 10^th claimants are to be taxed in accordance with the Legal Aid Ordinance.

Mr Lawrence Ng, instructed by Liu, Chan & Lam on assignment by the Legal Aid Department, for the 2^nd, 5^th, 8^th and 10^th claimants (appellants).

The 1^st, 3^rd, 4^th, 6^th, 9^th and 11^th claimants (appellants) in person.

Mr Paul Wu, instructed by Jimmie K.S. Wong & Partners, for the defendant (respondent).

Translated by the Judgment Translation Unit of the Judiciary and approved by Mr. Edmund Cham, Solicitor.