Introduction

An employer is vicarious liable for an employee’s wrongful act committed in the course of his employment. As a general rule, an employer would only be liable when the employee’s wrongful act is reasonably foreseeable as a result of the employee’s performance of his duty. However, there have been cases where the employers were held vicarious liable for employees’ wrongful acts, even though such acts were not authorized by the employer.

An employee’s wrongful act is deemed to have been committed in the course of employment if it is either (1) something authorised by the employer or (2) an unauthorised mode of doing something authorised by the employer. Regarding (2) the “unauthorised mode” limb, the test is whether the employee’s unauthorized tortuous act was so “closely connected” with the employment that it would be fair and just to hold the employer vicariously liable. In our article on “Employer’s Liability Towards Unauthorized Act of the Employees”, we discussed the “close connection test” applied by the courts in determining whether an employer is vicariously liable for its employee’s tort committed not authorized by the employer (please click here for our article).

In Breton Jean v HK Bellawings Jet Limited & 3 others [2024] HKDC 1695, the Hong Kong court once again discussed the close connection test and considered for the first time an employer’s vicarious liability regarding an employee’s defamation against another employee.

Background

The plaintiff, Mr Jean Breton, was employed as a pilot by HK Bellawings Jet Limited (“Bellawings”), a jet management company. He was employed from July 2015 until he was summarily dismissed in December 2016. Mr Breton brought claims against Bellawings at the District Court (transferred from the Labour Tribunal) for (1) his statutory rest day pay, and (2) wrongful dismissal.

Bellawings contended there were four bases for the summary dismissal, one of which was Mr Breton had misconducted himself on numerous occasions. Bellawings relied on the complaints made by three employees in their respective emails to management alleging Mr Breton had engaged in unprofessional conduct, including excessive drinking, inappropriate behaviour and poor communication (“3 Emails”). The Court observed that the complaints were couched in general terms, and there was no evidence whether Bellawings had carried out any investigation into these complaints. The Court was not satisfied that Bellawings could justify Mr Breton’s summary dismissal on this basis. Nevertheless, the Court held that Mr Breton was absent from work from 8 to 13 December 2016 without good reason and Bellawings was justified in summarily dismissing him.

However, the District Court found in favour of Mr Breton’s rest day pay claim in respect of standby time. Bellawings appealed against the decision, and the Court of Appeal dismissed the appeal. We discussed the Court of Appeal’s decision in our article “Court of Appeal confirms that standby time cannot be counted as statutory rest days or contractual day off” (please click here to read more).

Subsequently, Mr Breton brought a defamation claim at the District Court against Bellawings and his three former colleagues on the basis of the 3 Emails. He claimed Bellawings was vicariously liable for their defamatory statements contained in the 3 Emails as they were sent by the employees in the course of their employment. Mr Breton sought damages for HK$3 million on the basis that the 3 Emails damaged his reputation and caused him to be shunned and avoided. He also said that the 3 Emails resulted in his summary dismissal and loss of earnings as the summary dismissal prevented him from securing employment in the aviation industry.

Key legal issues

Deputy District Judge Patrick Siu identified five key issues to determine:

1.      Whether the 3 Emails were defamatory and met the threshold of seriousness;

2.      Whether the contents of the 3 Emails were true in substance (justification);

3.      Whether the 3 Emails were published on an occasion of qualified privilege;

4.      Whether Bellawings was vicariously liable for the publication of the 3 Emails; and

5.      What remedies, if any, should be awarded to Mr Breton.

Issues 1, 2 & 3

On issues 1, 2 and 3, the Court found that:

1.       The statements contained in the 3 Emails were capable of injuring Mr Breton’s reputation as a pilot. They were defamatory and met the threshold of seriousness. 

2.       The defendants failed to provide sufficient particulars to support of their defence of justification.

3.       The 3 Emails were published on an occasion of qualified privilege. The three employees had a duty to report their concerns about Mr Breton’s conduct to their employer, and the recipients of the emails had a corresponding interest in receiving this information. The Court emphasised that qualified privilege protects communications made in good faith in the context of employment, even if the allegations were later proven to be false.

Issue 4: Vicarious liability

Given the Court’s ruling on qualified privilege, it was not necessary to determine whether Bellawings would be vicariously liable for the employees’ defamation. Nonetheless, the Court held (in obiter) that had it been necessary to determine the issue, it would have held that Bellawings was not vicariously liable.

In reaching this conclusion, the Court applied the principles derived from UK Supreme Court and High Court authorities (Pena v Tameside Hospital NHS Foundation Trust [2011] EWHC 3027 (QB), Mohamud v WM Morrison Supermarkets plc [2016] AC 677, Armes v Nottinghamshire County Council [2018] AC 355). In relation to defamation, an employer would be vicariously liable for their employee’s defamation where the employee was acting within the scope of his employment when he made the publication. This is a mixed question of fact and law. The appropriate test was whether the wrongful conduct alleged was so closely connected with the acts the employee was authorised to do that, for the purpose of the liability of the employer to third parties, the wrongful conduct may fairly and properly be regarded as done by the employee while acting in the ordinary course of the employee’s employment.

The Court was of the view that Bellawings was not vicariously liable for the three employees’ publication of the 3 Emails. The Court considered the mere fact that the three employees complained about the working performance of Mr Breton did not in itself make the complaint a business activity of Bellawings. The touchstone, rather, was whether the publication of the 3 Emails was so closely connected with acts that three employees were authorised to do that it could be fairly and properly regarded as having done by them while acting in the ordinary course of their employment with Bellawings.

It could not be said that Bellawings authorised or directed the employee defendants to issue the 3 Emails, or that the publication of the 3 Emails was part of the business activity of Bellawings. It was not sufficient for Mr Breton to pray general reliance on the fact that the 3 Emails were sent by the 2^nd to 4^th defendants as employees of Bellawings regarding another employee. The pertinent question is what functions or field of activities have been entrusted by Bellawings as employer to the 2^nd to 4^th defendants as employees. They were employed by Bellawings as pilots and flight attendant, and the publication of the 3 Emails cannot be considered to be part of or incidental to the performance of the function to which their employment was related. In giving vent to their personal views on and feelings towards Mr Breton, the employee defendants were not acting on Bellawings’ behalf.

Issue 5: Remedies

Although the question of remedies did not arise, the Court made observations on the remedies sought. The Court rejected Mr Breton’s claim for damages for loss of reputation and earnings, as well as a mandatory apology from the defendants, as Mr Breton’s summary dismissal was justified on other grounds and that there were no exceptional circumstances to warrant a mandatory apology.

Takeaway

The discussion of the employer’s vicarious liability in the judgment in Breton Jean v HK Bellawings Jet Limited & 3 others is significant albeit obiter. This is the first Hong Kong case where the court has considered in detail an employers’ vicarious liability in relation to employee’s defamation against another employee, and how the close connection test ought to be applied.

Employers may unlikely be held vicariously liable for an employee’s personal views on and feelings towards another employee that are defamatory, especially when they are not part of or incidental to the performance of the function of the employee (i.e. not closely connected with the employment of the employee concerned).

Employers should also be mindful that there are statutory provisions which provide that the employer may be liable for the wrongful acts of its employees even though such acts were done without the employer’s knowledge or approval. For example, the Sex Discrimination Ordinance (Cap.480), the Personal Data (Privacy) Ordinance (Cap.486), the Disability Discrimination Ordinance (Cap.487), the Family Status Discrimination Ordinance (Cap.527) and the Race Discrimination Ordinance (Cap.602), they all contain provisions which provide that anything done by a person in the course of his employment shall be treated for the purpose of these Ordinances as done by his employer as well as by him, whether or not it was done with the employer’s knowledge or approval. Under these Ordinances, an employer will be liable for the violation of personal data privacy, discrimination and harassment committed by its employees unless the employer can prove that it took such steps as were reasonably practicable to prevent the employee from doing so.

It is therefore important for the employers to be vigilant. It is good practice for employers to put in place guidelines (perhaps in their employees handbook) to safeguard or minimise the risks of employees from making defamatory statements or violating the abovementioned Ordinances against other employees at workplace, and for the employers to be held vicariously liable as a result. Employers may also consider educating or providing training for their employees. As always, if in doubt, it is advisable to seek legal advice.

 

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Important: The law and procedure on this subject are very specialised and complicated. This article is just a very general outline for reference and cannot be relied upon as legal advice in any individual case. If any advice or assistance is needed, please contact our solicitors.

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