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Hong Kong Family Friendly Bitesize

18 December 2013
Mayer Brown JSM Newsletter

Family Friendly Practices and the Employment Ordinance (continued)

In the last Bitesize we established that there were circumstances where an employee working less than 18 hours for 4 consecutive weeks could satisfy the "418" rule. These include where time not spent at work should nonetheless be deemed to be an "hour worked" due to the provisions of Schedule 1 of the EO.

Schedule 1 provides that an absence from work "in circumstances such that by law, mutual agreement or the custom of the trade, business or undertaking" the employee is to be "regarded as continuing in the employment of his employer" shall be treated as an hour worked.

This begs the question as to when is an employee to be "regarded" as continuing in employment due to:

  • law
  • mutual agreement, or
  • custom?

There will be few (if any) circumstances where there is a requirement "by law" for there to be continuity of employment. In addition, circumstances where employment continues due to "custom" are also rare.

However, the concept of a "mutual arrangement" is one which has been seized upon by the courts who have been looking to infer a global contract. Courts have become quick to assume that parties are treating a period of non work as a period during which the employment continues.

This is naturally a concern for employers as they may find that arrangements which on their face quite clearly do not satisfy the basic requirements of the "418" rule, are deemed to satisfy such requirements by virtue of the imposition of a global contract (and the deeming of the "break" to include "hours worked"). This could have serious consequences for the employer, including the accidental failure to pay statutory benefits which could in turn result in criminal prosecution.

The next Bitesize will consider ways of avoiding a "global contract".

If you are interested in receiving our Hong Kong Family Friendly Bitesize series, or if you have any questions on the series, please email bitesize@mayerbrownjsm.com.

Authors

  • Duncan A. W. Abate
    T +852 2843 2203
  • Hong Tran
    Partner
    T +852 2843 4233

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