Business Law Articles
By: ONC Lawyers
Hong Kong, Hong Kong (SAR)
Employment disputes may arise from time to time but swift action by the employer and sincere discussion will enable the parties to resolve the disputes amicably.
Disputes regarding the terms of employment
Cathay Pacific’s cabin crew union indicated that a strike may be necessary if its request regarding 3 matters are not met by their employer. Their requests are (1) the employer shall pay the same hourly rate for all the employees who had recently finished their initial 3-year training contracts and signed the “permanent” employment contracts even if they signed the employment contracts after 16th April (the proposed cut-off date for a lower hourly rate) ; (2) the employer shall not reduce the meal allowance; and (3) the employer shall not remove the legal protection clause in the employee’s manual so that employees will be protected and/or assisted by the employer in case legal issues arise while they are on duty.
“Equal pay for equal work”?
In Hong Kong, parties have the freedom of contract. Employers and job candidates are free to negotiate the terms of employment. As the economic and market situation are changing all the time, the terms of employment offered by the same employer for the same job but at different times may be different. Therefore, it is possible that employees of the same corporate level may be subject to different terms of employment only because they joined the company at different times!
Variation of the terms of employment
Once the parties had signed the employment contract (which may incorporate the terms as stated in another document e.g. Employee’s Handbook), the employer cannot unilaterally vary the fundamental terms of the employment (e.g. wages and allowances). If the employer unilaterally varies the terms of employment without any valid reason (e.g. because of the conduct or capability or qualifications of the employee), by virtue of the Employment Ordinance (“EO”), the employer will be taken to have intended to use the variation to extinguish or reduce the right, benefit or protection conferred or to be conferred on the employee by the EO. In that case, the variation will be deemed to be unreasonable under the EO and damages may be payable to the relevant employee.
If an employer would like to vary the fundamental terms of employment because of the changes in the market situation or any other reasons, it shall communicate with the employees before the changes are to take effect. The employer shall inform and/or explain to the employees about the reasons for the proposed changes and explore a mutually acceptable way of effecting the proposed changes together.
In fact, employers shall always maintain communication with their employees, to understand their concern as well as to share with the employees about the employer’s position, mission, visions, plans and proposals. If sincere and effective communication can be maintained, employees will be more willing to accept changes and may be more motivated to work harder for the employer that will be conducive to the business development of the company.
Cathay Pacific Airways has been discussing with the cabin crew union in relation to the employee’s request. With the assistance of the Labour Department, there were signs of progress in the discussion at the time when this article was prepared. Sincere communication can definitely help the employer and the employees to understand the position of each other better. It will also assist the parties in resolving the differences amicably and to prevent the differences from escalating into a “conflict”. As such, disruption to the company’s business can be minimized.
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