Must the Notice Period for Termination of Employment for an Employer and its Employee be Reciprocal?
The decision of the Court of First Instance
in鄺惠玲 v 麗景酒店有限公司經營麗景酒店 HCME 1/2011 held that the notice period for
termination of employment for the employer and its employee can be
non-reciprocal provided that the requirements of the Employment Ordinance are
fulfilled.
Introduction
Most contracts of employment contain
reciprocal notice period for termination of employment i.e. the length of
notice required for the termination of the employment by the employer and its
employee are the same. However, some employment contracts may stipulate different notice periods
for the employer and its employee. Are
such provisions valid? A recent decision
of the Court of First Instance (“CFI”)
in 鄺惠玲
v 麗景酒店有限公司經營麗景酒店 HCME1/2011 has clarified this issue.
Facts
of the case
鄺惠玲 (“the Employee”) was employed as a
room attendant by 麗景酒店有限公司經營麗景酒店 (“the Employer”). The Employee was subject to a probation period of 6 months pursuant to the employment contract. The Employer terminated the employment during
the 5th month of the probation period by payment of 7 days’ wages in
lieu of notice to the Employee. However, the Employee took
the view that she was entitled to payment of 1 month’s salary in lieu of notice. Therefore, she claimed against the Employer
for the balance of the payment in lieu of notice in the Minor Employment Claims
Adjudication Board (“MECAB”) (the amount involved was within the jurisdiction
of the MECAB) (i.e. not exceeding HKD8,000.00 for each Claimant).
The
Employment Contract
The employment
contract contains the following provisions:-
“Termination of Employment. The Employee’s employment may be
terminated by the Employer for any of the following reasons:
1. ……………..
2. without
cause, upon giving the notice referred to in the Employment Ordinance of Hong
Kong;
Notice. Should the Employee choose to
resign their position, Employee must provide Employer with a minimum
notice period of one (1) month, unless otherwise agreed by both parties.”
Minor
Employment Claims Adjudication Board
The MECAB held
that amongst other reasons, if the Employee must give 1 month notice for
terminating the employment pursuant to the terms of the employment contract,
the non-reciprocal notice period which the Employer was subject to (7 days pursuant
to the Employment Ordinance) was invalid.
Court
of First Instance
The Employer
appealed to the CFI against the decision of the MECAB. The CFI overturned the
decision of the MECAB and held that as long as the requirements of the
Employment Ordinance are complied with, the law does not prohibit the parties from
adopting non-reciprocal notice period for termination of employment. The relevant requirements which must be
satisfied includes the minimum period of notice under the Employment Ordinance
that may be agreed by the parties of a continuous contract i.e. at least 7 days’
notice for termination of employment after the first month of the probation
period and thereafter.
Comments
In view of the
decision of the CFI in 鄺惠玲 v 麗景酒店有限公司經營麗景酒店, there are calls from
trade unions to amend the Employment Ordinance to prohibit non-reciprocal
notice period for termination of employment because some employees may not have
the bargaining power to negotiate for reciprocal notice period provisions. However, unless and until any such amendments
are made, the notice period for the termination of employment for the employer
and its employees can be non-reciprocal provided that the relevant requirements
of the Employment Ordinance regarding the minimum notice period as mentioned
above are fulfilled.
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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. |
Published by ONC Lawyers© 2011 |