Many employers set out their policies and procedures that apply generally to their employees in a staff handbook as a separate document from the employment contract, and then expressly incorporate the staff handbook into their contracts of employment. In some cases employers go further, expressly stating in the contract that the employee is bound by future amendments to the staff handbook.
The Hong Kong Court of First Instance has confirmed that, for an employee to be bound by an amendment to his contract of employment, he must have actual notice and knowledge of the amendment.
In this case, Mak Kin Hung Donald and others v OPG Human Resources Limited (HCLA22 & 23/2009), the employer appealed against the decision of the Labour Tribunal awarding the claimant employees wages in lieu of notice, annual leave pay and severance pay.
The claimant employees were reporters, working for the defendant employer in the "Breaking News" section of the Oriental Press Group. Under the provisions of their contracts of employment, they were bound to comply with the rules in the Staff Handbook, and were also obliged to pay attention to a notice board which would show amendments to the Staff Handbook.
In June 2008, the employer added a new rule to the Staff Handbook, by posting it on the notice board. This new rule prohibited contacts between employees and the employees of rival media organizations (subject to certain exceptions). The employer was concerned to prevent sensitive news-information being leaked. Each of the different employees' cases was slightly different; here we focus only on the conclusions reached in relation to one of them.
In the following months, one of the claimants, Mr Lam Po Yik, had telephone conversations with reporters from other newspapers. After the employer discovered this, Mr Lam, was summarily dismissed for "contravening the work rules, serious misconduct and divulging news information".
The employer argued that Mr Lam was bound by the new rule, since either it had been brought to his attention, or if not, he had failed to pay attention to the notice board, in breach of contract. The court disagreed. It found that in order for the unilateral amendment to become part of the employee’s contract, it must actually be brought to the attention of the employee. It is not sufficient to put the employee under a separate obligation to check the notice board for amendments.
For an employer to have the certainty that any unilateral amendment of contracts of employment will be effective, it should ensure that it brings the amendments to the actual notice of affected employees. Simply putting amendments on a notice board (or, indeed, the staff intranet) may not be effective unless the particular employee actually reads them.
How this is done will depend on the circumstances, but it is suggested that the safest approach would be for each employee to be provided with actual written notice of the amendments and for the employee to be required to acknowledge his or her consent to the changes by signing a written copy of the amendments.