Employers Cannot “Dress Up” a Termination as a Resignation by the Employee to Minimize the Termination Payment
International Business Articles
ONC Lawyers
Hong Kong
Employees who resign are not entitled to various payments under the Employment Ordinance and under the specific terms of their employment contracts. However, employers cannot avoid or minimize the contractual and statutory payments by a sham or a “forced” resignation.
Introduction
An employer may enter into a fixed term contract with an employee (with very favourable terms) if that employee is considered to be conducive to the business development of the employer.
Subsequently, if the employer wants to have an early termination of the employment (not because of the employee’s misconduct), the employer cannot “force” the employee to resign in order to minimize the termination payment which will be payable to the employee.
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November 2014