In the July Edition, we reported that when an employee is unreasonably and unlawfully terminated, the Labour Tribunal may make a reinstatement or re-engagement order without the consent of the employer, only the employee’s consent is required. If an employer refuses to re-engage a dismissed employee, he or she will need to pay the employee a maximum sum of three times the employee's average monthly wages, subject to a cap of HK$50,000.

However, on 22 June 2016, the Secretary for Labour and Welfare of the Government of the Hong Kong Special Administrative Region made a statement that the Labour Advisory Board still requires extensive discussion and consultation regarding the proposed amendments to the Employment (Amendment) Bill 2016. If the Bill does indeed lapse, it may be reintroduced during the next Legislative Council term commencing in October 2016.

Anti-Corruption and Bribery-Newly Published Training Package

The Independent Commission Against Corruption has recently published a training package titled "Integrity + Quality: Shopper's Paradise - Corruption Prevention Training Package for Retail Industry" ("Guidebook") on 13 May 2016.

In light of the retail industry's vulnerability to risks of corruption and misconduct, the Guidebook aids employers in training frontline employees and management staff. Although the Guidebook is targeted at the retail industry, the principles and tips contained in it have a wide applicability to all employers.

The Guidebook reminds employers that in a situation where there is a reservation of high demand goods for customers by directors, staff and agents, there could be a breach of anti-bribery laws, because they may reserve goods in high-demand for certain customers for unauthorized advantages in return, or abuse their employers' staff discount policy by reselling the purchased items for profit. This means that employees in specific retail  outlets are vulnerable to being approached by parallel traders who would offer monetary rewards, commission payments or kickbacks in return for "special VIP treatment", including reserving or setting aside a certain number of these high-demand goods for parallel trading.

Trade Description Ordinance

Troubled gym chain California Fitness, being the 2nd largest gym operator in Hong Kong, closed down all of its business operation in Hong Kong pending the outcome of the winding-up proceedings. Two senior executives (a company secretary and a senior manager) from the fitness chain were arrested by the Hong Kong Customs and Excise Department for failing to provide relevant services after having accepted payment from consumers under the Trade Descriptions Ordinance (“TDO”).

Back in April, the Consumer Council also shamed California Fitness for misleading sales practices, such as forcing customers to take out loans from financing companies to pay for their membership fees at the club.

Under the TDO, a trader commits an offence if at the time of acceptance of payment, the trader intends not to supply the product, or to supply a materially different product, or there are no reasonable grounds for believing that the trader will be able to supply the product within a specified or reasonable period. Moreover, the TDO prohibits specified unfair trade practices deployed by traders against consumers, including false trade descriptions of services, misleading omissions, aggressive commercial practices, bait advertising, bait- and-switch and wrongly accepting payment.  The management staff will also be liable if the offence is committed with their consent or connivance or is attributed to their neglect. The maximum penalty upon conviction is a fine of HK$500,000 and imprisonment of five years.

It is therefore important that a company provides training to the sales staff not to engage in unfair trade practices that are in breach of the TDO.  The management should also not turn a blind eye to such practices as the directors may be found personally liable for knowingly endorsing such practices.