LCQ15: Legal right to utilise employee's annual leave entitlement as part of length of notice required to terminate contract of employment
Section 6(2A) of the Employment Ordinance (Cap. 57) stipulates that annual leave to which an employee is entitled in law shall not be included under section 6(2) of the Ordinance in the length of notice required to terminate a contract of employment. According to the judgment of the Court of Final Appeal handed down in 2008 on a civil appeal case (Case No. FACV7/2008), section 6(2A) is intended to provide statutory protection for an employee's entitlement to paid annual leave. The trial judges pointed out in the judgment that while section 6(2A) had not expressly said that the protection under that section was only for the benefit of employees to the exclusion of employers, an employee was entitled in law to choose to utilise his annual leave entitlement as part of the length of notice. However, some employees have relayed to me recently that employers and employees are generally unaware of the aforesaid judgment, and they mistakenly think that under section 6(2A), when an employee makes a request to his employer for the termination of his contract of employment, he is not allowed to utilise his annual leave entitlement as part of the length of notice. In this connection, will the Government inform this Council:
(1) whether it will, in the light of the aforesaid judgment of the Court of Final Appeal, amend section 6(2A) to expressly state that the protection under that section is only for the benefit of employees to the exclusion of employers; if so, of the timetable and details; if not, the reasons for that; and
(2) whether the authorities will, before making the aforesaid amendment to section 6(2A), adopt measures to ensure that an employee may exercise his legal right to utilise his annual leave entitlement as part of the length of notice; if so, of the details; if not, the reasons for that?
My consolidated reply to Member's question is as follows:
The Employment Ordinance (The Ordinance) requires that an employer or an employee who terminates the contract of employment should give appropriate notice period or payment in lieu of notice to the other party of the contract. Sections 6 and 7 of the Ordinance set out respectively the required notice period or payment in lieu of notice for terminating a contract of employment, while section 6(2A) provides that annual leave to which an employee is entitled under section 41AA shall not be included in the length of notice required to terminate a contract of employment. In the case of Kao, Lee & Yip v Lau Wing and Tsui Wai-yu (FACV 7/2008), when deciding the issue of taking annual leave within the notice period by the employee concerned, the Court of Final Appeal (CFA) ruled respecting the application of section 6(2A) that an employee tendering resignation has the right to take the annual leave entitled under the Ordinance within the required notice period.
CFA has in the abovementioned case provided a clear ruling over the application of section 6(2A) of the Ordinance. As such there is no pressing need to amend the section at the present stage. If employers and employees have questions or disputes over their arrangements in terminating an employment contract, they may seek the assistance of the Labour Relations Division (LRD) of the Labour Department (LD). LRD would advise employers and employees in accordance with the requirements of the Ordinance and the rulings of the court, and, where necessary, help conciliate the disputes. LD's 24-hour enquiry hotline 2717 1771 also renders relevant advice to enquirers. In promoting the Ordinance, LD will also assist employers and employees to understand their respective rights and obligations, including the courts' ruling and interpretation of the provisions of the Ordinance.
Ends/Wednesday, October 25, 2017
Issued at HKT 14:50
Issued at HKT 14:50