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2020 Employment Law Updates – 10 Areas for Employers to Note

Jennifer Tam, Partner, Mayer Brown

Hong Tran, Partner, Mayer Brown

2020 has been a busy year for HR practitioners for various reasons. In addition to dealing with the challenges associated with COVID-19, business contraction (for some) and new ways of working, employers also need to handle or at least be aware of the developments in employment law. Below are 10 areas that employers should pay particular attention to.

1. Employment Support Scheme (ESS)

Under the ESS, a wage subsidy scheme, each eligible employer may receive from the HKSAR Government a maximum amount of subsidy of HK$9,000 each month per eligible employee, from June to November 2020.

There are certain undertakings and obligations that employers must provide and comply with. Employers need to ensure that the number of employees on payroll during the subsidy period be not less than the number of employees (paid or unpaid) in March 2020. They must also use all the subsidy for paying the employees’ wages. Failing which, they are required to return the subsidy in full or in part to the Government.

2. Call for listing COVID-19 as an occupational disease

COVID-19 is currently not listed as an occupational disease under the Employees’ Compensation Ordinance (ECO). The Labour Department will keep a close watch on the relevant medical and epidemiological data, and make appropriate recommendations.

Although COVID-19 is currently not a prescribed occupational disease, an employee may still claim compensation under the ECO for the virus if it is a personal injury by accident arising out of and in the course of employment. If an employee has contracted or is suspected to have contracted COVID-19 at work, the employer should report this to the Labour Department.

3. Four additional weeks of statutory maternity leave (not in force yet)

Under the Employment (Amendment) Ordinance 2020, statutory maternity leave entitlement for female employees who are employed under a continuous contract of employment will increase from 10 to 14 weeks. The additional four weeks’ statutory maternity leave will be paid at the rate of four-fifths of the employee’s daily average wage, capped at HK$80,000 in total. Employers may apply for reimbursement of the additional maternity leave pay from the Government, but details of the arrangement are not available yet.

The period of pregnancy mentioned in the definition of “miscarriage” will also be shortened from 28 to 24 weeks under the same amendment ordinance. If a female employee suffers a miscarriage at or after 24 weeks of pregnancy, she will be entitled to maternity leave, should other conditions be fulfilled.

A certificate of attendance, instead of a medical certificate, issued by a registered medical practitioner, Chinese medical practitioner, midwife or nurse, is sufficient proof for pregnancy and post-natal sickness, for payment of any statutory sickness allowance.

The above new measures are expected to come into effect by the end of this year. Employers should review their maternity leave policy to take into account the anticipated changes.

4. Unlawful breastfeeding discrimination (effective from 19 June 2021)

The Sex Discrimination Ordinance (SDO) will be amended to provide for unlawful discrimination on the grounds of “breastfeeding”. A woman will be treated as breastfeeding if she is engaged in the act of breastfeeding a child or expressing breast milk, or feeds a child with her breast milk.

Both direct and indirect breastfeeding discrimination will be unlawful. An employer will be taken to have directly discriminated against an employee on the grounds of breastfeeding, if he treats her less favourably than those who are not breastfeeding in the same or not materially different circumstances. Indirect discrimination arises when a condition or requirement is applied to everyone equally but a smaller proportion of women who are breastfeeding can comply than those who are not breastfeeding, with the employee who is breastfeeding suffering a detriment as a result and the condition or requirement being unjustifiable.

The law on breastfeeding discrimination will come into force on 19 June 2021. Meanwhile, employers should review and update their anti-discrimination policies and provide training, in preparation for the upcoming changes.

The prohibition on breastfeeding harassment will be dealt with separately in the Sex Discrimination (Amendment) Bill 2020. It is expected that the bill will be deliberated in the next Legislative Council session.

Items 5 to 9 below summarise the changes made to the SDO, Disability Discrimination Ordinance (DDO), Family Status Discrimination Ordinance (FSDO) and Race Discrimination Ordinance (RDO) in June 2020.

5. Expansion of protection from unlawful harassment in the workplace

The protection of unlawful sexual harassment, disability harassment and racial harassment under the SDO, DDO and RDO, has been expanded to cover “workplace participants” if they work in or attend the same workplace. “Workplace participants” include not only employers, employees, contract workers, commission agents, partners in a firm, but also interns and volunteers.

Interns and volunteers will be personally liable for acts of harassment they commit in the course of an internship or performing the volunteer work. For employers who engage an intern or volunteer in their workplace, they may be vicariously liable for the unlawful act of harassment their intern or volunteer committed, even if the unlawful act was done without their knowledge or approval.

Employers, who can prove that they have taken reasonably practical steps to prevent the interns and volunteers from committing the act of unlawful harassment in the workplace, may have a defence to vicarious liability. The onus is on the employer to prove the defence, and the more effective precautionary steps taken the better. Employers should implement and update their anti-harassment policies and provide appropriate training to all workplace participants on their rights and responsibilities.

6. Unlawful race discrimination and harassment by imputation and against “associates”

The definition of “race” under the RDO has been amended to cover “race” or “racial group” that is imputed to a person. Thus it is possible to engage in unlawful race discrimination by treating someone less favourably because it is assumed they are of a particular race, when in fact they may be not.

Individuals who are treated less favourably because of the race of an associate are also protected under the RDO now. “Associate” has the same meaning under the RDO and DDO, which includes the spouse of the person, another person who is living with the person on a genuine domestic basis, a relative of the person, a carer of the person, and another person who is in a business, sporting or recreational relationship with the person.

7. Protection against disability and racial harassment by service providers and customers

Under the SDO, it is unlawful for a service provider to sexually harass a customer in the course of offering goods, facilities or services, and for a customer to sexually harass a service provider when acquiring goods, facilities or services. The DDO and RDO have now been amended to provide similar protection to prohibit disability and racial harassment by service providers and customers.

8. Protection against sexual and disability harassment of a member or applicant for membership of a club

The SDO and DDO have been amended to make it unlawful for a club or the management committee of a club and its members, to sexually harass a person or to harass a person with disability who is or has applied to become a member of the club. A “committee of management of a club” means the group or body of persons, however described, who manages the club’s affairs. As such, a club may be held liable for the conduct of an individual, who has a management role within the club even though he is not employed by the club.

9. Intention is irrelevant in determining damages for unlawful indirect discrimination

For unlawful indirect sex, race and/or family status discrimination committed on or after 19 June 2020, the Court may award damages to a successful claimant even if the less favourable treatment is unintentional. As intention is irrelevant to determining the issue of unlawful discrimination, an employer should proactively stress test its policies to ensure that there is no unlawful indirect sex, race and/or family status discrimination.

10. Occupational retirement schemes must be “employment-related”

The Occupational Retirement Schemes Ordinance (ORSO) was amended in late June 2020. The revised legislation will require any employer who has an “occupational retirement scheme” to confirm that such a scheme is only available to their employees, and the only members of the scheme are their current or former employees. This is to prevent any misuse of the occupational retirement scheme for non-employment related purposes. The circumstances in which a retirement scheme can obtain an ORSO exemption certificate are also limited. For international businesses looking to set up office in Hong Kong, that wish to employ executives here who are members of an overseas retirement scheme (a home country scheme), the clear route enabling them to obtain an exemption certificate prior to the amendment is now removed. Employers must ensure an exemption certificate is obtained for the home country scheme in order to avoid committing an offence.

Further developments are expected for some of the areas covered above, from the enhanced maternity leave arrangement to the introduction of protection against breastfeeding discrimination and harassment. Employers should stay tuned for updates, and review their maternity leave and anti-discrimination and harassment policies to reflect the new legal requirements.

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