LIU KAM CHEONG v.TIN WO ENGINEERING CO LTD

bjbj HCLA31/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE LABOUR TRIBUNAL APPEAL NO. 31 OF 2006 (ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO.1046 OF 2006) -----------------------------------------

BETWEEN LIU KAM CHEONG Defendant (Appellant) and TIN WO ENGINEERING COMPANY LIMITED Claimant (Respondent) ------------------------------- Before : Hon Poon J in Court Date of Hearing : 4 January 2007 Date of Handing Down Reasons for Judgment : 10 January 2007 ------------------------------------------------------

R E A S O N S F O R J U D G M E N T ------------------------------------------------------ Introduction

AUTONUMOUT The claimant was a daily waged steel binder employed by the defendant between February 1998 and January 2006. In February 2006, he commenced proceedings in the Labour Tribunal, claiming against the defendant for four items, namely, (1) wages in lieu of notice (HK$20,280), (2) annual leave pay for the period between 28 February 2000 and 12 November 2005 (HK$46,210.37), (3) statutory holiday pay (HK$64,050) for the period between 28 February 2000 and 11 October 2005 and (4) severance pay or long service pay (HK$52,281.42). After trial, the presiding officer allowed the claim on annual leave pay and statutory holiday pay and dismissed other items. The defendant then appealed.

AUTONUMOUT On 4 January 2007, I allowed the appeal, set aside the award and remit the case to the Labour Tribunal before the same presiding officer for further investigation and determination. These are the reasons for my judgment. The Issue

AUTONUMOUT It would appear that the basis of the claimant s claim for annual leave pay and statutory holiday pay is that there existed a continuous contract within the meaning of the Employment Ordinance, Cap.57 ( the Ordinance ) throughout the entire period of his employment with the defendant that entitled him to those items. Presumably, he used 28 February 2000 as the starting point for the items because of limitation.

AUTONUMOUT The only issue that I need to determine in this appeal is whether, as contended by the claimant, there existed between the parties a continuous contract since 28 February 2000 up to the termination of his employment which entitled him to the annual leave pay and statutory holiday pay as claimed. I will call this the Issue below. The presiding officer s findings

AUTONUMOUT In his Reasons for Judgment dated 19 September 2006, the presiding officer had this to say :y3u"} JTlQ /Uhs/f ]\O!j 3u"} N(W1 t^eQw FOdkI{ l&N N e 0&N NI{ gGW g S/f2 eKN1 )YgQ ]xes^GW ,gHh JTlQ l g-rp 3u"}

NKNX (u&N N&{ O-NKN na3u"} eKN< ]\O'` eP[/f eTSp Vdk cgq NgQ,{3 e3u"} JTlQ 3u"} NeQw O-NKN ]\OKN O-ND N,{3 0 0 nce. Mr Chan for the claimant disagreed. He submitted that it was not necessary for the presiding officer to pore over the effect of section 3 of the First Schedule. In any event, the presiding officer had not failed to carry out investigation as contended before making his findings on the question of continuous contract.

AUTONUMOUT will deal with counsel s submissions in greater detail below. Any failure to investigate?

AUTONUMOUT Chan contended that it was not necessary for the presiding officer to consider section 3 of the First Schedule by taking two points. First, the defendant had not raised continuous contract as an issue in its written defence. Second, the defendant admitted that the claimant was entitled to annual leave pay and statutory holiday pay but alleged that they had already been included in the daily wage. This confirms that the question of continuous contract is not an issue. In support, Mr Chan relied on Luen Hing Engineering Company v. Lam Cho Kwan & Others, HCLA15/1995, unreported, Findlay J, 24 May 1995

AUTONUMOUT fully accept that the presiding officer is entitled to have regard to a written defence for the purpose of determining what issues are relevant : the Luen Hing case per Findlay J at p.3. However, the written defence is not the only document that the presiding officer needs to refer to in order to determine what issues are relevant. When a case comes before the presiding officer for trial, the parties have already filed their witness statements and documentary evidence. The presiding officer needs to give proper regard to all of them for the purpose of determining what issues are relevant. Indeed, if he discerns that there are relevant matters which the parties have not explored, he is obliged to look into them and invite the parties to comment or even direct them to produce further evidence : Ng Ming & Others v. Cheung Wah Investment Co. Ltd trading as Hoover Restaurant, HCLA10/2003, per Deputy High Court Judge Lam (as he then was), at para.11. (a) there was no information to confirm if the claimant had worked and (b) the claimant did not work at all ( the Periods ). The obvious question then arose is whether the Periods constituted breaks in the continuity of the claimant s employment. See Lui Lin Kam & Others v. Nice Creation Development Ltd [2006] 3 HKLRD 656, where Tang JA (as he then was) agreed with the observation made by Deputy Judge Lam (as he then was) hearing the appeal in the first instance that a break of working less than 18 hours within one week is sufficient to break the continuity of employment for the purpose of the First Schedule

AUTONUMOUT The admission by the defendant that the claimant is entitled to annual leave pay and statutory holiday pay must be considered in context. When the evidence is viewed in the round, I do not think the defendant had admitted that the claimant had worked under a continuous contract throughout the entire period of employment which entitled him to the annual leave pay and statutory holiday pay as claimed. What the defendant had admitted, as Mr Ng has rightly conceded, amounts to this. The claimant is entitled to some annual leave pay and statutory holiday pay, depending on the length of the continuous contract(s) that he had with the defendant throughout his employment. (The contention that such entitlements had already been covered by the claimant s daily wage is plainly not maintainable. The presiding officer was correct in rejecting it. And the defendant has not sought to challenge the presiding officer s conclusion on this point.)

AUTONUMOUT For these reasons, I reject Mr Chan s primary submission and hold that the Issue is a live issue between the parties. I next turn to his alternative submission that the presiding officer had in any event duly considered the question of continuous contract. This brings me to a closer examination of what the presiding officer had said in this regard.

AUTONUMOUT In paragraph 15 of his Reasons for Judgment, the presiding officer first said that the defendant had not raised the question of continuous contract as an issue. In light of what I have said above, this remark cannot stand. The presiding officer nevertheless went on to identify the question of continuous contract as an issue. But unfortunately, contrary to Mr Chan s submissions, he had not properly considered all the matters pertaining to the Issue before answering it in the claimant s favour.

AUTONUMOUT First, he had not conducted any investigation on the e 0&N NI{ 1Y 0i Second, his comment that the number of working days between 1 October 2003 and 31 December 2005, other than the period between 1 and 15 October 2003, is even is irrelevant to the question of continuity. He should have applied sections 2 and 3 of the First Schedule to the Ordinance and see if there existed a continuous contract throughout the claimant s employment. See Leung Wan Kee Shipyard Ltd v. Lik Shau Foo [1995] 3 HKC 229, per Waung J at pp.232C-233D.

AUTONUMOUT Third, the presiding officer xplained how the evidence of the parties supported his conclusion. As I have pointed out above, the effect of the evidence of defendant s witnesses is quite to the contrary. Mr Chan referred to me to the evidence of the defendant s representative, Mr Au-yeung Sing at page L of the transcript `O1\q bO N OvuBf ]ZPlQ vuBf P$R- N1\}Y mKb@u" _1\I g1\q z gP NASt^ T#jZP NASt^@T @b g 0 0 he requirements in sections 2 and 3 of the First Schedule.

AUTONUMOUT For these reasons, I hold that the presiding officer had failed to carry out investigation on all the relevant matters pertaining to the Issue. His award cannot stand. Conclusion

AUTONUMOUT would therefore allow this appeal, set aside the award and remit the case to the same presiding officer for further investigation and determination on the question of continuous contract and the quantum of the claimant s entitlement to annual leave pay and statutory holiday pay. And for that purpose, the presiding officer should adopt the Issue and proceed accordingly.

AUTONUMOUT For completeness, I would mention this. Mr Ng relied on the Lui Lin Kam case and argued that there was no mutual obligation between the parties supporting a global contract covering the claimant s successive periods of employment. I do not think this question arose in this appeal. For the presiding officer had made no reference to it at all. If need be, it should be canvassed by him when the matter comes before him again.

AUTONUMOUT On costs, they should follow the event. The defendant is to have the costs of this appeal including the costs of the application for leave to appeal, to be taxed if not agreed. The claimant s own costs are to be taxed in accordance with the Legal Aid Regulations. (J. Poon) Judge of the Court of First Instance High Court Mr Lawrence Ng, instructed by Messrs Peter W.K. Lo & Co., for the Defendant (Appellant) Mr David Chan, instructed by Messrs Lau & Chan, assigned by Director of Legal Aid, for the Claimant (Respondent)

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