If employees break rules and perform extremely unsatisfactorily, the corporate management has to handle the situations discreetly. Otherwise, the company's operational efficiency, employees whom are performing well and those with high motives would be affected. In recent years, some employees might even take advantage of the grey areas in the statutory laws and the statutory protection to put employers in difficult situation. This seminar will be referring to the latest and the landmark court cases which in relation to these issues, guide employers make suitable planning to terminate such employees legally and increase the chances of employers winning in potential lawsuits.
1. An employee reports work injury right after being terminated (recent case in 2021): Employer terminated an underperforming employee with payment in lieu of notice according to the Employment Ordinance. The employee did not sign any document and left the company immediately. On his way out of the office building, he claimed that he slipped in the stairs and got injured. The employer and its insurer insisted that the employment relationship had been terminated and therefore rejected the claim of work-related injury. Based on what legal principles did the court rule on such dispute? If the employer is to be ruled against, will he or she need to retrieve the termination notice and allow the employee to be reinstated?
2. An employee claims that the employer did not explicitly give the cause of termination, and the employer is in breach of section 32K of the Ordinance of not providing a legal legitimate for reasonable dismissal (recent case in 2021): Employee claimed that in the course of termination, there was no mentioning of a valid and legitimate reason of termination, which was in breach of section 32K of the Employment Ordinance. The Labour Tribunal ruled in favour of the employee and was awarded over 1 million of unreasonable termination damages. The employer appealed and won at the High Court. What were the legal principles behind the overturning of the decision? What implications does it have for human resources management?
3. An employee had been performing extremely unsatisfactorily and was terminated by payment in lieu of notice. But on the day of termination, he claimed that he suffered from various degrees of discrimination and harassment of his supervisor and made complaints to the Equal Opportunities Commission: According to section 9 Victimization of the Discrimination Ordinance, after employee has made complaints to the management of the company and the Commission, he will be given legal protection. Employee in the case claimed against the employer at the court for 21 million. Upon three appeals, the employer ultimately won the case. What were the legal principles adopted and what actions made by the employer were recognised by the court in making a decision in favour of the employer?
4. A group of employees was terminated for breaching company's discipline, but the management made derogatory statements against them and failed to commence disciplinary actions against their actions in accordance with the staff handbook when they were terminated. Employees claimed against the employer: Such case finally went to the Court of Final Appeal, the court held that the employer terminated reasonably, however, he needed to pay damages for the derogatory statements he made. Regarding the failure to commence disciplinary hearings in accordance with the contract and staff handbook, the court ruled against the employer as well. What were the legal principles behind these decisions by the court?
5. An employee was terminated in the morning but presented a medical certificate on the same day afternoon claiming that an injury was suffered two days ago. How should the employer deal with such situation according to the law? If employees are on paid sick leave, it would be unlawful to terminate them. Should the employer retrieve the termination notice? How did the High Court look at the case and what were the legal principles behind? (Note: the court ruled against the employee, what was the rationale affirming that there was a reasonable termination?)
6. In view of economic downturn, employer and an employee came to an agreement of a 52% salary reduction. The reduction had been executed for a few months; however, these two parties did not work well with each other. During the resignation arrangement discussion, the employee insisted that the employer was reducing his wage unreasonably and unilaterally, and claimed that it was a constructive dismissal by the employer: In this current dispute, what rationales were based on when the High Court made decision? (Note: the employer won the case, it was held that there was no constructive dismissal.)
7. A senior-level employee, with a 6-month probation, felt that he would be terminated soon, thus presented a medical certificate issued by a specialist doctor proving that he had mental illness and claimed that the mental illness was due to heavy workload during probation period: In the relevant landmark case, what were the legal principles relied by the court for accepting this as reasonable termination and no breach of any discrimination ordinance sections.
8. An employee persistently failed to meet basic requirements of the job; the employer therefore decided not to renew his contract. The employee sought review of such decision at the court and focused on challenging the requirement which he was requested to examine by a medical practitioner specified by the company when he was sick: Such court decision was a fundamental for human resources policy on handling employees who frequently apply sick leaves, which stated that the Discrimination Ordinance would not take away the employer's authority in handling frequently sick leave cases.
9. An employee took advantage of grey areas in the statutory law to claim for more protection and compensation, which leaded to potential lawsuits even when termination was reasonable: There is a grey area in the Ordinance where during no paid sick leave, whether rest days are paid. As a good employer who had a past practice of paying rest days for sick leave employees, how should this employer deal with such an employee who make use of the legal grey areas? How did the court rule on such sick leave rest day payment issue in this case? (Note: Case law and statutory law hold different complementing interpretations.) In the case the employer had reasonably terminated an employee on sick leave without breaching the Discrimination Ordinance.
10. There is explicit guideline that employee shall not take up any jobs outside of his/her full-time job, especially when the particular part time business clashes with the employer's business: In this case, a senior officer was terminated. The case had been clinging for a few years, and it finally went to the Court of Final Appeal, employee won eventually. In another High Court case, the employee bought shares in his friend's company, the business which involved was related to his full-time job. After knowing such shares purchasing, employer terminated the employee. The employer lost in the case as well. In both cases, there was one important implication for human resources – there are two principles and a pressure test to be passed for an employer to reasonably terminate employee in such circumstances.
11. As a senior officer of the company, the employee wrongfully adopted legal opinion that caused the management to make wrongful decision, breaching listing rules and was summarily dismissed: In this case, the employee claimed that the employer had unreasonably and wrongfully terminated him. In the whole process of termination, what mistakes were made and what rules were breached by the employer that caused him to lose the case?
12. After being terminated, the employee claimed that he suffered work injury before termination, but did not report the injury as it was not serious. He claimed that after termination, his work-related injury got worst, and reported it to the Labour Department. He requested for reinstatement, saying that if the employer did not allow such demand, it would lead to criminal liability of unlawful termination: How did the court look at such dispute, and what was the legal view?
13. In view of economic downturn, employees who are underperforming and have the feeling that they are soon to be terminated, may make use of statutory law to protect their jobs: According to section 72B of the Employment Ordinance, after employee making complaints towards the employer for breaching of any section of the Ordinance, during investigation of the Labour Department any discrimination against him by the employee during or after the investigation, including termination, shall be subject to prosecution. In the case where employer won, what are the legal principles the employer has to abide by for him to reasonably terminate and lawfully resist section 72B offence?
14. Among many cases where the employer terminates underperforming employees who had just ended their long persistent sick leave or work-related sick leave or after pregnancy, what are the legal principles and objective terminating causes that would cause the court to consider termination reasonable and not in breach of the Discrimination Ordinance?
15. After senior officers or department heads resigned or left the company, the company witnessed that other employees in the same department resigning en masse. How can the employer deal with this in accordance with the law?
16. Other legal principles that employers and human resources need to know for reasonable termination:
a. Boston Deep Sea Fishing principle: After the resignation of an employee, the employer discover that the employee had made significant mistake. Can the employer summarily dismiss that employee and claim back the compensation that he paid for the employee's resignation? How did the landmark case interpret the issue?
b. According to section 9 of the Employment Ordinance, habitual neglect of duties can be considered as lawful evidence for reasonable termination. In the 2020 case, the High Court made clear definition for the term – Habitual.
c. The employer ignored employee's acts of breaking company rules, did not give warning or counselling, and did not publicly notify that such acts were not allowed by the employee. This would be considered as employer's acceptance of such acts. According to the Doctrine of Waiver, the employer cannot use such acts as evidence to support a reasonable termination or summary dismissal. How did the 2020 case view such principle?
d. Fiduciary Duty refers to the duty that senior officers shall not make decisions based on their own interests instead of the company's interests, otherwise the employer may base on such act and reasonably terminate them. In 2020 case where the employer won, how did the court consider the common law principle of fiduciary duty as a duty that senior officers should abide by?
e. In different court cases, the court's view in the handling of warning letters require attention. For example, how to issue warning letters and why a warning letter may be considered as reasonable work commands.
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