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Global employment briefing: Hong Kong, June 2017

  • Hong Kong
  • Employment law

01-06-2017

Reinstatement proposal goes forward

We previously wrote about a proposal to allow the Labour Tribunal to issue an award for reinstatement or re-engagement of a claimant employee. Since our update in February 2016, the Employment (Amendment) Bill 2016 (the “2016 Bill”) has been scrutinised and consensus has now been reached; the original legislative proposal will remain unchanged but the ceiling of the penalty will increase from HK$50,000 to HK$72,500. We expect the new amendments will be enacted in the near future. It is worth noting that under Hong Kong’s anti-discrimination legislation, the court already has authority to make an order of reinstatement without the employer’s agreement. As such, it will become more expensive to avoid taking back an employee whose claim is successful, but employers will not be forced to do so.

Same-sex marriage (for civil servants) recognised under Hong Kong law

On 28 April 2017, the Court of First Instance made a landmark decision in the case of Leung Chun Kwong v Secretary for the Civil Service and Commissioner of Inland Revenue [2017] HKEC 854. Mr Leung, a civil servant, applied for judicial review of two separate government decisions denying health and tax benefits to his spouse, whom he married in New Zealand in April 2014 (New Zealand recognises same-sex marriage, whereas Hong Kong does not.) Following a petition filed by 27,000 individuals, 80 civil groups and five lawmakers, the Department of Justice has appealed the ruling, and we will keep readers updated as this case develops.

Health benefit decision: discriminatory and unconstitutional

Pursuant to the Civil Service Regulations (“CSRs”), government medical and dental benefits are extended to “family”, which includes a “spouse”. Although “spouse” is not defined under the CSR, the Secretary for the Civil Service considered that because Mr Leung’s same-sex marriage is not legally recognised under the Marriage Ordinance, his spouse was not entitled to the benefits set out in the CSRs.

The court held that there is nothing unlawful for the Secretary to accord the same spousal benefits to homosexual couples who are legally married under foreign law and that it is difficult to see how denial of “spousal’ benefits to homosexual couples who are legally married under foreign laws would strengthen the integrity of the institution of marriage in Hong Kong. As a result, differential treatment by the Secretary was not justifiable.

Tax benefit decision: acceptable treatment

Mr Leung challenged the Commissioner of Inland Revenue’s decision to deny his right to elect for joint assessment when filing his tax returns. The Commissioner reasoned that although the Inland Revenue Ordinance (“IRO”) does not expressly exclude same-sex marriage, the relevant provisions provide that only “husband and wife” are eligible for joint assessment. Therefore, Mr Leung and his partner cannot be eligible. The court ruled that as a matter of construction of the IRO, the Commissioner’s decision that Mr Leung’s same-sex marriage is not a marriage for the purpose of the IRO, was correct.

Comment

“Marriage” is defined under Hong Kong’s Marriage Ordinance as a “formal ceremony recognized by the law as involving the voluntary union for life of one man and one woman to the exclusion of all others”.

There are many rights conferred on spouses in Hong Kong legislation. However, the definition of ‘spouse’ is neither clear nor uniform across these laws and regulations. The Employment Ordinance (“EO”), for instance, provides that “spouse” means “the person to whom the employee is lawfully married”. It is uncertain from this definition whether “lawfully married” includes marriages recognised under foreign law but not Hong Kong law.

The court emphasized in its judgment that granting benefits to same-sex marriage partners would not constitute indirect legalisation of same-sex marriage and whether to recognise same-sex marriage as legally valid marriage is a matter of social policy and a decision for the legislature, not for the court. Employers who want to demonstrate their support of equal employment opportunities irrespective of sexual orientation can pledge to adopt the Equal Opportunity Commission’s Code of Practice against Discrimination in Employment on the Ground of Sexual Orientation. This Code is not legally binding and simply proposes good practices in a workplace. More than 150 organisations have already voluntarily signed up for the Code.

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