Statutory annual leave
Contractual annual leave
Statutory sick leave
Contractual sick leave
The government has repeatedly referred to the possibility of implementing compulsory universal testing (CUT) and, while it announced on 21 March 2022 that it will not implement CUT for the time being, it did not exclude the possibility that CUT will be reintroduced in the future when the conditions are more appropriate.
The precise details of any such CUT are yet to be confirmed. However, if CUT follows a similar arrangement as before, all Hong Kong citizens would need to undergo three rounds of covid-19 tests. Citizens would need to make appointments for a test according to their year of birth through a booking system. Between each round of testing, citizens would also be required to take a rapid antigen test on a daily basis before undergoing the next virus test. CUT may also be accompanied by an extensive lockdown, or local lockdowns.
Violation of these requirements will lead to criminal sanctions.
If CUT goes ahead, increased employee absences are expected, which will disrupt most employers' business operations. Employers should, therefore, have arrangements in place to deal with the likely effects that CUT will have on their business. This article provides guidance by answering some questions that employers may have.
There are two categories of annual leave in Hong Kong: statutory annual leave and contractual annual leave. The ability to ask an employee to take annual leave for the period of testing will depend on the type of annual leave.
Statutory annual leave refers to the annual leave that is prescribed under the Employment Ordinance.(1) After completion of the first year of employment, an employee is entitled to seven days of statutory annual leave in the year following its accrual. This entitlement increases progressively to a maximum of 14 days according to the employee's length of service.(2)
For this type of annual leave, an employer may direct an employee to take annual leave by giving at least 14 days' written notice (or less, if agreed with the employee).(3) However, the employer cannot make such a direction in the year in which the statutory annual leave accrues. The employer may direct the employee to take statutory annual leave only if the employee has accrued a sufficient number of statutory annual leave in the previous year.
In other words, employees can be asked to take their statutory annual leave for CUT, but only in relation to annual leave (if any) that was accrued in 2021. The requirement that employers must give 14 days' notice creates difficulties; it is hoped that any CUT will be announced well in advance of the commencement date, so that employers can give the necessary directions.
Contractual annual leave refers to any annual leave in excess of the statutory annual leave, as agreed in the employment contract.
Whether an employee can be directed to take contractual annual leave will depend on the terms stated in the employment contract (ie, any specific terms that govern when and how the annual leave should be taken).
If the contract provides the employer with a right to direct the employee to take annual leave on a specific day, the employer may require the employee to take contractual annual leave on the same days that they will be absent for testing. As no prior notice is required (unless the contract states otherwise), it may be easier to make employees use their contractual leave than statutory leave, if possible.
In the event that the employment contract does not distinguish between statutory and contractual annual leave, all annual leave must be given statutory treatment. This means that where there is any doubt, employers should give at least 14 days' notice to their employees to take annual leave for the testing.
Can employees be asked to take unpaid leave for any period of absence due to testing?
Employers do not have a statutory right to require that their employees take unpaid leave.
Therefore, unless the employment contract expressly gives them the right to do so, employers cannot unilaterally compel their employees to take unpaid leave. This will require the employees' consent.
Can employees take sick leave for any period of testing?
As with annual leave, there is a distinction between statutory and contractual sick leave, and the answer will depend on what kind of sick leave is involved. Legislation has also been introduced to deal with this specific issue.
On 25 February 2022, the government gazetted the Employment (Amendment) Bill 2022. The Bill aims to deal with some of the consequences for employees of restrictions resulting from the covid-19 pandemic. One of the effects of the Bill will be that a period of absence from work due to compliance with a mandatory testing order or notice that is required under the Prevention and Control of Disease (Compulsory Testing for Certain Persons) Regulation(4) will be regarded as a sickness day under the Employment Ordinance.
The Bill has not yet entered into force; however, the government has said it wants to put it into effect as soon as possible. The government has not yet announced how CUT would be treated if it is implemented (ie, whether, as presumed, it will be by way of a testing order or notice under the Regulation).
If the mandatory testing order or notice for CUT that is issued under both the Regulation and the Bill has come into force by the time of the mandatory testing, it is expected that a period of absence for compulsory testing will be regarded as statutory sick leave. However, an employee is entitled to a paid sickness allowance only if:
- they have accrued a sufficient number of statutory sickness days;
- the period of absence lasts for four or more consecutive days;
- the employee can produce the relevant document or electronic data that shows that they are undergoing mandatory testing; and
- the employee is not subject to such restriction due to their own serious and wilful misconduct (eg, breaching the social distancing measures under the relevant legislations).
It is presently anticipated that CUT will involve a total of three rounds of tests over a period of approximately seven to 21 days; however, depending on waiting times, each round of testing may only require up to half a day. As the absence from work for each round of testing is unlikely to last for four or more consecutive days, it is unlikely that employees will be entitled to paid sickness allowance for absences when undergoing CUT.
In the event the Bill has not come into effect by the time that CUT beings, under the current Employment Ordinance, any period of absence due to compliance with a mandatory testing order is unlikely regarded as statutory sick leave because a statutory sickness day is currently defined as "a day on which an employee is absent from his work by reason of his being unfit therefor on account of injury or sickness".(5) Therefore, it is unlikely that employees will be able to take statutory sick leave for any period of testing.
As for granting sick leave, this will depend on what is written in the employment contract.
Generally speaking, as mandatory testing is not a form of sickness, it is unlikely to fall within most contractual sick leave provisions.
Can an employee be requested to produce documentary proof that they are undergoing the testing during their period of absence?
It is unclear if the government will issue any official documents regarding CUT. However, it is anticipated that booking the tests will be done through a central system. Therefore, there will likely be a booking confirmation of the testing date and time.
There is generally no legal obligation for an employee to provide any such documentary proof to the employer. Employers may still ask their employees to provide it, but this should be on a voluntary basis.
If an employee satisfies the relevant requirements (as set out under "Can employees take sick leave for any period of testing?") and claims the statutory sickness allowance, their employer has the right to request the employee to produce documentary evidence that they have been subject to mandatory testing.
Can employees be requested to choose a particular day and/or timeslot for the testing so as to accommodate the company's business needs?
In general, if there are legitimate reasons justifying such a request (eg, certain work can only be carried out during a particular hour or the employee is needed to satisfy staffing requirements), it would be permissible for the employer to require the employee to undertake testing at a specific time (ie, this would be a lawful and reasonable direction). On this basis, employers may request their employees to choose a particular day and/or timeslot for the testing.
However, given that there is likely to be a quota for each testing timeslot, employers should show understanding, even if the employee is not able to book the requested date and timeslot. This also assumes that employees will be given a choice – if CUT is reintroduced, the arrangements may not involve much flexibility as regards the timing of their testing. In that case, employers will not be able to lawfully prevent their employees from undertaking compulsory testing in accordance with the government's requirements.
Employers should consider the following when planning for the possibility of CUT:
- adopting flexible working hours – for example, if the testing is estimated to take two to three hours, employers may bring forward or push back the official working hours by two to three hours on the specific testing dates, with the employees' prior consent;
- adopting a work-from-home arrangement – this will allow employees to undergo CUT in designated centres in their neighbourhood and to save their travel time; and
- allocating work to the employees – this should be done with consideration of their testing schedule.
Given that the government could implement CUT at relatively short notice, employers should be ready to adopt the necessary measures quickly. Employers may also wish to consider providing their employees with at least an outline of the intended measures, so that they know what to expect.
For further information on this topic please contact Patricia Yeung at Howse Williams by telephone (+852 2803 3688) or email ([email protected]). The Howse Williams website can be accessed at www.howsewilliams.com.
(1) Chapter 57, Laws of Hong Kong.
(2) Section 41AA of the Employment Ordinance.
(3) Section 41AA of the Employment Ordinance.
(4) Chapter 599J, Laws of Hong Kong.