Ending the employment of an employee in Hong Kong needs careful consideration of Hong Kong labor law, specifically the Employment Ordinance (Cap. 57). Generally, employers must give notice or payment in lieu when terminating an employee, but there are exceptions—summary dismissal being the most severe.
Summary dismissal means ending a job immediately without warning or pay, normally because of serious misconduct.
This guide aims to help employers in Hong Kong grasp the lawful reasons, right procedures, and likely pitfalls of summary dismissal. It assists them in complying with the law and avoiding expensive problems.
What is summary dismissal?
It is when an employer dismisses an employee without notice or pay, due to employee’s extremely wrong action.
Legal Basis
An employer can immediately dismiss an employee under Section 9 of the Employment Ordinance (Cap. 57) if the employee has acted very seriously wrong or is unable to fulfill essential job requirements.
Common Misconceptions
- It’s not for poor performance – Summary dismissal is not used for dealing with low performance or trivial mistakes.
- It must be justified – Employers need good and real reasons; otherwise, they might be exposed to unfair dismissal claims.
Under What Circumstances Is Summary Dismissal Legal in Hong Kong?
For a summary dismissal to be legal, the reason must be serious, factual, and reasonable. Good reasons include:
Typical Lawful Reasons:
- Severe misconduct (e.g., workplace violence or harassment)
- Stealing or lying (even attempting to steal)
- Intentional disobedience of lawful and reasonable orders
- Habitual neglect of duty despite warnings
- Fraud or breach of trust that harms the working relationship
Importance of Justice
The response should be equal to the severity of the misconduct. Employers must be even-handed and not make arbitrary decisions, or they could be challenged for wrongful dismissal.
Legal Procedures for Carrying Out Summary Dismissal
Even if the reasons are legitimate, employers must follow the proper procedures to ensure that the termination is legal.
Step-by-Step Process:
- Carry out an internal inquiry – Objectively and impartially gather facts.
- Record the misconduct – Keep written reports, witness accounts, or other documentation.
- Allow the employee to explain – Provide an opportunity for them to respond before a final decision is made (principle of natural justice).
- Issue formal termination letter – State the grounds and the date of dismissal.
Failure to follow the correct procedures could lead to grievances, even when the malfeasance in fact took place.
Risks and Consequences of Unlawful Summary Dismissal
Termination without a valid reason can cause legal issues between employers and employees.
Possible Results
- Unfair dismissal claims under the Employment Ordinance
- Reinstatement orders or compensation through Labour Tribunal
- Damaged employer branding and employees’ morale
- High-cost legal disputes and governmental inspections
Best Practices for Employers
To avoid legal trouble and manage dismissals professionally, employers should adopt the following best practices:
Recommendations for Employers:
- Develop clear rules on discipline in employment manuals and contracts.
- Educate HR personnel on adherence to labor laws and equitable practices.
- Consult legal advisers where misconduct is severe or uncertain
- Maintain proper records of warnings, investigations, and decisions.
By taking action promptly, employers can safeguard their enterprises and ensure fairness and accountability within the workplace.
Need help with Hong Kong HR compliance?
Seek the advice of expert HR consultants or legal experts to make sure your dismissal policies are within the law. Moreover, we can help you find the best talents for replacement.