YUEN WAI HAN v. SOUTH ELDERLY AFFAIRS LTD

DCEO 6/2001

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EQUAL OPPORTUNITIES CASE NO. 6 OF 2001

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Assessment

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1. I have previously ruled that the Defendant had unlawfully discriminated the Plaintiff because of her pregnancy when the Defendant rescinded the contract to employ her as a supervisor of the Defendant's elderly home. I now assess damages arising out of such discrimination.

2. There are 3 heads of damages namely 1) loss of income, 2) injury to feeling and 3) punitive damages.

LOSS OF INCOME

3. The Defendant on 10/6/00 agreed to employ the Plaintiff as supervisor of its elderly home at the monthly salary of $15,000 from 18/6/00. At that time she was employed by Lok Yee Sanatorium Ltd. as a supervisor at a monthly salary of $10,000.00. On 12/6/00 the Plaintiff tendered her resignation with Lok Yee Sanatorium Ltd. with effect from 17/6/00. However after she tendered her resignation the Defendant rescinded her contract. The Plaintiff managed to stay in the employment with Lok Yee until 17/7/00. She was not able to find work until 20/11/00 earning $10,000 a month. Had her contract not been rescinded I am of the view that she could have no problem working for the Defendant at least until 17/6/01.

4. Her loss of income from 18/6/00 to 17/7/00 is : $(15,000 - 10,000) = $5,000 being the difference in income between what she could have got from the Defendant and the income she received from Lok Yee Sanatorium Ltd.

5. From 18/7/00 to 17/11/00 she was unemployed so she suffered a loss of 4 months' income i.e. $15,000 x 4 = $60,000. From 18/11/00 to 17/6/01 she earned $10,000. The difference in income for 7 months is therefore $(15,000 - 10,000) x 7 = $35,000. However because of her pregnancy she was not entitled to her salary for her 2.5 months' maternity leave i.e. 2.5 x $15,000 = $37,500.00.

6. Her total loss of income is therefore $(5,000 + 60,000 + 35,000) - $37,500 = $62,500.00.

INJURY TO FEELING

7. At that time she was pregnant, she was the only person with income and had to borrow to make ends meet. That had caused her anxiety and embarrassment. Further because of her complaint to EOC the Defendant made a report to the police which was not substantiated. Mr. Cheng Bun for the Defendant in cross examination agreed that but for the Plaintiff's complaint the Defendant would not have reported to police. It was an unfounded allegation amounting to an attack on her character. This has also inured her feeling as she had to suffer the indignation of being treated like a criminal in the police station. She was interrogated and had been cautioned.

8. The principles for deciding on the damages under this head has been neatly summarised by Judge Christie in K & ors v Secretary for Justice [2000]3 HKLRD 777 at 812 and are as follows :-

(i) Awards for injury to feelings are compensatory. They should be just to both parties. They should compensate fully without punishing the tortfeasor. Feelings of indignation at the tortfeasor's conduct should not be allowed to inflate the award. (ii) Awards should not be too low, as that would diminish respect for the policy of the anti-discrimination legislation. Society has condemned discrimination and awards must ensure that it is seen to be wrong. On the other hand, awards should be restrained, as excessive awards could, to use the phrase of Sir Thomas Bingham MR, be seen as the way to "untaxed riches". (iii) Awards should bear some broad general similarity to the range of awards in personal injury cases. We do not think this should be done by reference to any particular type of personal injury award, rather to the whole range of such awards. (iv) In exercising their discretion in assessing a sum, tribunals should remind themselves of the value in everyday life of the sum they have in mind. This may be done by reference to purchasing power or by reference to earnings. (v) Finally, tribunals should bear in mind Sir Thomas Bingham's reference to the need for public respect for the level of awards made.

9. In Vento v Chief Constable of West Yorkshire Police [2003] IRLR 102 Lord Justice Mummery has set out three broad bands of compensation for injuries to feelings which are as follows :-

(i) The top band should normally be between ￡15,000 and ￡25,000. Sums in this range should be awarded in the most serious cases, such as where there has been a lengthy campaign of discriminatory harassment on the ground of sex or race. This case falls within that band. Only in the most exceptional case should an award of compensation for injury to feelings exceed ￡25,000.

(ii) The middle band of between ￡5,000 and ￡15,000 should be used for serious cases, which do not merit an award in the highest band.

(iii) Awards of between ￡500 and ￡5,000 are appropriate for less serious cases, such as where the act of discrimination is an isolated or one-off occurrence. In general, awards of less than ￡500 are to be avoided altogether, as they risk being regarded as so low as not to be a proper recognition of injury to feelings.

10. I am of the view that in the present case it may be serious but it is an isolated or one-off occurrence so I assess damages for injury to feeling at $62,500.

PUNITIVE DAMAGES

11. S.76(3A)(8) of Sex Discrimination Ord. Cap. 480 states that punitive damages can be awarded.

12. Although as stated in K & ors v Secretary for Justice that feelings of indignation at the tortfeasor's conduct should not be allowed to inflate the award under injury to feelings, the act of the Defendant reporting to police that the Plaintiff obtained pecuniary advantage by deception without any justifiable ground warrants punitive damages. The report to police was malicious. It was made purely because the Plaintiff reported to EOC. The Plaintiff was arrested and put on bail. The Defendant's conduct merits punishment.

13. Although both in Ma Bik Yung v Ko Chan [1999] 2 HKLRD 263 and Yuen Sha Sha v Tse Chi Pan [1999] 2 HKLRD 28 the punitive damages is about 1/3 of the award for non-pecuniary damages, the facts are different and this is a far more serious act of the Defendant. The act merits a far higher award. I assess the punitive damages to be $30,000.

14. In the premises I assess damages at $(62,500 + 62,500 + 30,000) = $155,000.00.

15. By consent no order as to costs.

Representation:

Mr. Herman L H Poon, Assistant Legal Advisor of Equal Opportunities Commission for Plaintiff.

Defendant, IN PERSON, represented by Mr. Cheng Pan （鄭彬）, Director of South Elderly Affairs Limited.

DCEO6/2001

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EQUAL OPPORTUNITIES CASE NO. 6 OF 2001

Coram: H H Judge Wong

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J U D G M E N T

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1. In this action, the plaintiff claims against the defendant for unlawful pregnancy discrimination under section 8A and section 11(1)(c), or alternatively, section 11(2)(c) of the Sex Discrimination Ordinance, Cap. 480.

The Undisputed Facts

2. The plaintiff is a social worker. She has been a registered social worker since July 1999. Since 23 July 1999 until 18 June 2000, she was employed as a supervisor in Lok Yee Sanatorium Limited. Some time in May 2000 she was interviewed by Mr Chan Hoi-hung of the defendant and was employed by the defendant as a part-time social worker working on Sundays.

3. During the interview she told Mr Chan that she was four months pregnant. About two weeks later, after she worked as a social worker, Mr Chan asked if she was interested in the post of supervisor, and she had another interview with Mr Chan on 10 June 2000. Mr Chan told her that her qualification as a social worker would bring a professional image to the defendant, and he wanted to attract more business for the defendant.

4. Mr Chan asked her to sign a contract for the post of supervisor. She indicated that she wanted 10 weeks' no pay maternity leave. Chan told her that in the contract there was a clause that only employees who had worked for more than 40 weeks were entitled to paid maternity leave, so she signed the contract. After she signed the contract, Chan asked whether she understood how to handle applications for social welfare allowance for residents of elderly homes. She told Chan she had not handled such applications before, but told Chan, according to her understanding, the procedure for such applications.

5. According to the contract, she had to report for duty on 18 June 2000, so she submitted her resignation to Lok Yee in the morning of 12 June 2000. At about noon on 12 June 2000, Chan called her by phone and rescinded the contract.

Reasons for Rescission

6. According to the plaintiff, Chan told her that after discussion with other directors, because she was pregnant she was not suitable for the job. Chan, on the other hand, said that the decision was based on the fact that she was inexperienced and did not know how to handle applications for social welfare allowance.

Was the termination of contract due to her incompetence or because of her pregnancy?

7. The plaintiff had been working as a supervisor until July 1999. That was clearly stated in her application form, and Chan knew about this. He agreed that he was impressed with the defendant's qualification and that would boost the image of elderly homes, and in comparison with others she was suitable, notwithstanding her experience. Yet in the same breath he said they required at least three years' experience as supervisor. When asked why the defendant rescinded the contract, Chan replied that that was because she had one year's experience in Lok Yee.

8. Chan clearly was not telling the truth. Although Chan said the main reason was her lack of knowledge about applications for social welfare, he agreed that the amount of social welfare allowance could be obtained from pamphlets or from telephone hotline.

9. He further said that what the supervisor had to do was to explain to the elderly and their family about social welfare allowance and the procedural matter would be handled by a clerk. The other director, Lau Pik-chuen, concerning social welfare procedure, said it was a clerical matter. The supervisor's duty is to liaise with the family members.

10. In any event, the plaintiff, during the interview, had told Chan her understanding of the procedure for making such applications. Further, according to the job duty list of a supervisor supplied by the defendant to the plaintiff, the application for social welfare allowance was not included in the list.

11. By reason aforesaid, I am satisfied that incompetence or lack of experience, the lack of knowledge in relation to social welfare allowance applications, could not have been a factor or the only reason for the defendant to rescind the contract of employment with the defendant.

12. The plaintiff in her evidence did say that Chan told her on 12 June 2000 that he had discussed with other directors because of her pregnancy, she was not suitable for the job. Miss Cheng Yim-king, a senior Equal Opportunities Officer of the Equal Opportunities Commission, on about 5 July 2000 wrote to the defendant informing the defendant that the plaintiff had lodged a complaint of pregnancy discrimination against them and asked them to provide relevant information.

13. On 17 July the Commission received a reply from the defendant. In that letter, apart from saying that at the time of signing the contract they found out from conversation that the plaintiff was not familiar with the business of homes for the elderly, social welfare issues and general knowledge about old people. Then in the following paragraph it wrote:

"Because our hostel consists of five buildings, each consists of upper and lower floors occupying a total area of about 40,000 square feet. Every day residents with disabilities have to be carried by tables and chairs from the 1st floor to the ground to facilitate them to walk and participate in activities on the lawn. As this sort of work is on a regular basis, therefore the supervisor, apart from administering the centre, usually has to take the lead in this sort of work."

14. This, in my view, is not a gratuitous information. It subtly brought out one of the reasons for rescinding the contract: that is, that the supervisor had to take the lead in moving tables and chairs regularly; therefore, the position of a supervisor was not suitable for pregnant women.

15. My view is fortified by the fact that pursuant to a telephone conversation between Chan and Miss Cheng of the Equal Opportunities Commission, Miss Cheng, by letter dated 25 July 2000, asked Chan to confirm the following conversation:

(1) the Centre had, in mid-July, employed a male as supervisor and he had reported for duty immediately;

(2) the reasons for rescinding the contract of Miss Yuen were:

(a) she was not familiar with the business of elderly homes, social welfare matters and general knowledge of the elderly;

(b) supervisor had to move the elderly home's objects. As she was pregnant, the Centre felt she was not fit to take up that position.

16. Despite repeated demands, the defendant had not given a positive reply either verbally or in writing. The defendant argued that Chan already knew the plaintiff was pregnant and so pregnancy could not have been a factor in the termination of her contract. However, when Chan entered into the contract on behalf of the defendant, the other directors had not been consulted. It was after consultation with the other directors that the contract was terminated. Chan admitted he made a mistake.

17. Mr Lau Pik-chuen, the other director, said that in law, the Centre cannot be without a supervisor for more than one month, and it is difficult to find a supervisor. Since the defendant, if she were to be employed, would have to take 21/2 months - that is, 10 weeks - no pay maternity leave in a few months' time, it would be a problem for the defendant.

18. So probable inference is that Chan overlooked this problem as he was too eager to employ the defendant because of her qualifications. It was only after discussion with Lau that they realised pregnancy was a problem.

19. In the premises, I find on balance that pregnancy was at least one of the reasons for the termination of the contract with the plaintiff.

The Law

20. Section 8A of Sex Discrimination Ordnance provides:

"A person discriminates against a woman in any circumstances relevant for the purposes of any provision of Part III or Part IV if:

(a) on the grounds of her pregnancy he treats her less favourably than he treats or would treat a person who is not pregnant."

Section 11(1)(c) provides:

"It is unlawful for a person in relation to employment by him at an establishment in Hong Kong to discriminate against a woman:

(c) by refusing or deliberately omitting to offer her that employment."

21. In R v Birmingham City Council ex parte Equal Opportunities Commission [1989] 1 AC 1155 at 1194, per Lord Goff:

"This is discrimination under the statute if there is less favourable treatment on the ground of sex; in other words, if the relevant girl or girls would have received the same treatment as the boys but for their sex. The intention or motive of the defendant to discriminate, though it may be relevant so far as remedies are concerned, is not a necessary condition of liability. It is perfectly possible to envisage cases where the defendant had no such motive and yet did in fact discriminate on the ground of sex."

This is the "but for" test which has been applied in the Court of Final Appeal in The Secretary For Justice and Others v Chan Wah and Others [2000] 3 HKLRD 641. In R v Great Britain China Centre [1992] ICR 516 at 528, between letter (g) and (h) per Niell LJ:

"...3. The outcome of a case will therefore usually depend on what inferences it is proper to draw from the primary facts found by the tribunal. These inferences can include, in appropriate cases, any inferences that it is just and equitable to draw from an evasive or equivocal reply to a questionnaire."

22. As I have found that pregnancy was at least one of the reasons for the defendant to terminate the contract of the plaintiff, and that a male staff had subsequently been employed in that position by the defendant, I am satisfied that a person who was not pregnant would not have received the same treatment as the plaintiff; that is, the rescission of the contract.

23. The defendant is therefore in breach of section 8(a) of the Sex Discrimination Ordinance and is liable to the plaintiff for damages.

24. At the request of counsel, the assessment of damages will be adjourned generally with liberty to restore.

25. There will be no order as to costs.

Representation:

Present: Mr Herman L H Poon, Acting Legal Advisor of Equal Opportunities Commission, for the Plaintiff

Mr James Collins, instructed by Messrs Lousich, Lau & Ngan, Solicitors, for the Defendant