In the case of Haden, Francis William v. Leighton Contractors (Asia) Ltd [2022] HKDC 152, the District Court handed down a landmark 130-page judgment on 11 February 2022 and dismissed the employee's claim of race discrimination. In this article, we  provide an easy-to-read case summary together with some key takeaways for employers.

Facts

Mr. Francis William Haden ("Mr. Haden") was employed by Leighton Contractors (Asia) Limited (the "Employer") in 2010 and was assigned to work on a tunnel project as the blasting team leader in 2016 ("Project").

In late February 2017, the Employer terminated Mr. Haden's employment.

Mr. Haden claimed that his employment was terminated as a result of his race, or that the termination was influenced by his race – as he was not Chinese. In particular, he alleged that this could be inferred from the following:

• He was very competent and technically very good at his job;
• He had been bypassed and his role as team leader had been usurped;
• He had raised the issue of racism at the meeting where his employment was intended to be terminated ("Termination Meeting");
• The term "Gweilo" was said on the Project;
• There was a lack of process in the termination.

Note: For those of our readers who are not familiar with the term "Gweilo" it is a Cantonese slang which might be roughly translated into terms such as "Ghost Man", "White Ghost", "White Devil" or "Ghostly Man". To provide some context, the term is widely used in Hong Kong and from a community survey conducted by an English newspaper, there appears to be no clear consensus in the community (both expatriates and locals included) as to whether the word is racially pejorative. A spokesman for the Equal Opportunities Commission was asked whether the word "Gweilo" could be regarded as harassment under the law, and the spokesman said that it would depend on several factors including the actual circumstances of the case, the context of the particular situation and the relationship between the parties involved. 

In May 2017, Mr. Haden filed a race discrimination complaint against the Employer with the Equal Opportunities Commission and subsequently commenced proceedings in the District Court in September 2018 where he claimed over HK$1 million in damages along with other relief.

Key legal principles

Race Discrimination Ordinance, Cap 602 ("RDO")

In Hong Kong, race discrimination is prohibited by the RDO. To summarize:

"Race" means the race, colour, descent or national or ethnic origin of a person, and includes a race, colour, descent or national or ethnic origin that is imputed to the person (section 8, RDO).

A person (i.e. the discriminator) discriminates against another person if on the ground of the race of that person, the discriminator treats that person less favourably than the discriminator treats or would treat other persons (section 4, RDO). In particular, it is unlawful for an employer to discriminate against an employee by dismissing him/her, or subjecting him/her to any other detriment (section 10, RDO).

A comparison of the case of a person of a particular racial group with that of a person not of that group must be such that the relevant circumstances in the one case are the same, or not materially different, in the other (section 8, RDO).

If an act is done for 2 or more reasons and one of the reasons is the person's race, then the act is taken to be done for the reason of that person's race – whether or not it was the dominant or substantial reason for doing the act (section 9 RDO).

Two-stage test

To establish a claim of direct discrimination, the court had to answer the following questions:

• Whether the Employer had treated Mr. Haden less favorably than it treated or would treat others ("Comparator Question"); and
• Whether the less favorable treatment (if any) was on the ground of the Mr. Haden's race ("Causation Question").

The approach

The court recognized that the identification of an appropriate comparator may sometimes cause unnecessary complication. Therefore, the court looked at the Causation Question first followed by the Comparator Question and compared Mr. Haden with a hypothetical comparator.

As there was no direct evidence that Mr. Haden was dismissed on the ground of race, the court considered each of the allegations raised by Mr. Haden to determine whether it could be inferred from the findings of fact that his employment had been terminated on the ground of race.

Issue and quick answer

Q:        Did the Employer terminate Mr. Haden's employment on the ground of race?

A:        No. The court found that Mr. Haden's employment was not terminated on the ground of race but due to his poor working relationship with others and his inability to work as a team.

Detailed analysis

Turning to each of Mr. Haden's allegations, the court observed the following:

• The claim that he was very competent and technically very good at his job

The court accepted that Mr. Haden was a very able person but there was ample evidence which showed that he was not someone who could maintain good working relationships. In particular, evidence showed that Mr. Haden had an abrasive character, was short-tempered and difficult to talk to when problems arose. His behaviour led to a strained relationship with colleagues and others especially members of the blasting team. The situation deteriorated to the point that staff became reluctant to deal with Mr. Haden directly on work related matters because of his temperament and asked the Project director and others to step in to communicate with Mr. Haden instead. Non-Chinese staff also had difficulty working with or were reluctant to work with Mr. Haden.

There was no evidence to show that his poor working relationship with others stemmed from race.

• The claim that he had been bypassed and his role as team leader had been usurped

This was a multifaceted allegation involving numerous claims. We have highlighted some of the claims below and the court's observations on the same. We have broadly categorized them into three parts:

• The first part was in relation to the hiring of the blasting engineer into his team, and Mr. Haden made a number of claims. First, he claimed that he was told there was a reluctance to hire a non-Chinese people. While the court found that there was a preference to hire someone who was Chinese, it was only in relation to finding someone who was able to communicate in Cantonese because it was needed for the job and not because of race.

Mr. Haden claimed that the blasting engineer was hired even though he did not agree with the hiring decision. However, evidence did not show that he had objected to the hiring of this individual at the material time. Also, it was clear that Mr. Haden did not have the authority to make hiring decisions, so it could not be said that the Employer in hiring the blasting engineer had bypassed him or usurped his role as team leader.

• The second part was in relation to being excluded and again, Mr. Haden made a number of claims. In particular, he claimed that he had been excluded from certain communications. While the court found that there were instances of this happening, it was due to his poor working relationship with others rather than race because other non-Chinese colleagues were not excluded from those communications.

Mr. Haden also claimed that the team deliberately held a meeting while he was on leave in an attempt to exclude him and did not report to him what was discussed at the meeting. The court rejected this claim as evidence showed that he was looped in on the emails pertaining to the meeting. Also, the fact that no one took the initiative to report to him did not amount to exclusion. Being aware that such meeting was held, he did not take the initiative to ask about what was discussed at the meeting.

Further, Mr. Haden claimed that the team would fail to attend meetings with him. While the court found that there were staff who did not turn up at meetings with Mr. Haden, it was due to the culture of the two different companies involved in the joint venture under which the team worked and his poor relationship with them, rather than his race.

• The third part was in relation to the actions of the Project director. In particular, Mr. Haden claimed that the Project director allowed the team to bypass him. However, the court found that the Project director (who himself was also an expatriate) was only acting as the bridge of communication between the team and Mr. Haden because the work relationship between the team and Mr. Haden had deteriorated to such an extent that the team would rather speak to the Project director (who was also an expatriate) than to Mr. Haden.
• The claim that he had raised the issue of racism at the Termination Meeting

Mr. Haden alleged that at this meeting, the Project director had already served him a termination letter but then backtracked on the decision to terminate his employment there and then after Mr. Haden called out that there was racism on the Project. However, the court found that the reason why the Project director changed his mind was not because Mr. Haden called out racism but because he wanted to give Mr. Haden a final chance since he had agreed to improve on the problem areas identified to him.

Worth noting also is that while Mr. Haden argued that the Employer terminated his employment due to race, the court pointed out that the people who were involved in the decision to terminate his employment were all non-Chinese.

• The claim that the term "Gweilo" was said on the Project

Mr. Haden alleged that the use of the term "Gweilo" on the Project created a racially hostile work environment and raised a number of claims. We have highlighted some of the claims below and the court's observations on the same:

• The court held that the term "Gweilo" is widely used in Hong Kong. The court was unable to find that the term would necessarily carry a derogatory meaning even if it was used in a work setting.
• Mr. Haden claimed that he would often overhear conversations where the term would be used, and it was frequently used in discussions among Chinese staff. He claimed that he knew what the word meant and since he was one of the few non-Chinese staff on the Project, he often felt that when the term was used, it was referring to him. However, the court said the context in which the term was used was important. There was no evidence to show that Mr. Haden was the subject matter of the conversations where the term was used. Mr. Haden only overheard other people use the term – they were not talking to him. It was just his feeling that they were talking about him, but this feeling may or may not be correct.
• Mr. Haden also claimed that the manner in which the term was used also made him feel like an outsider. However, Mr. Haden did not give details of the manner which gave him that feeling. In the absence of such details, the court was unable to find that the mere use of the term would give rise to such feeling. Instead, the court was of the view that Mr. Haden had either misunderstood the real meaning of the term or exaggerated his bad feeling.
• One of the witnesses, who worked with Mr. Haden and was himself also an expatriate, stated that in his many years of living in Hong Kong, he was not aware of any expatriate (himself included) who had any issue with people using this term and pointed out that this term was not just used by locals but also by expatriates too. The Project manager also gave similar evidence and even admitted to using the term himself.
• Mr. Haden claimed that he was made aware of an incident where the words "I see you got rid of the Gweilo" were said in another project which sounded congratulatory to him. The court questioned the relevance of this incident given that even Mr. Haden had pointed out himself that it was said in another project. In any case, the court could not see how this demonstrated that there was a hostile and discriminatory environment in that project, let alone the Project.
• Mr. Haden also claimed that a statement was made to the effect of "why so many gweilos are working on the project" which felt hostile to him. As the circumstances under which such statement was made were unknown, the court was not prepared to find that there was a hostile and discriminatory environment based on such hearsay.
• The court also commented on two other incidents cited by Mr. Haden. In relation to the words "did not speak Chinese" (which was not made in reference to Mr. Haden) the court said taking the matter at the highest, it only referred to linguistic ability rather than race. In relation to the word "Foreigner" used in one email, the court said that this in itself was inadequate to conclude there was racial hostility.

After considering the matters raised by Mr. Haden, the court found that there was no racial hostility in the use of the term "Gweilo" on the Project.

• The claim that there was a lack of process in the termination

Mr. Haden claimed that his employment was terminated due to race and not, as purported by the Employer, due to performance because there were no documents to show that he had performance issues. However, evidence showed that he had been duly warned about his problem areas prior to his employment being terminated. There was also no evidence that the termination was in breach of any of the Employer's internal processes.

Conclusion

On the Causation Question, the court held that Mr. Haden had failed to show any possibility from the facts that an inference could be drawn that his employment was terminated on the ground of race.

The real cause of the termination of his employment was his poor working relationship with others and his inability to work as a team. This was the reason why he was dismissed; not because of race.

The court then addressed the Comparator Question and concluded that if the circumstances were applied to a hypothetical person who was a Chinese blasting team leader and had the same poor working relationship with others and inability to work as a team as Mr. Haden, the Employer would have equally terminated the hypothetical person.

For these reasons, there was no race discrimination and the court dismissed Mr. Haden's claim.

As the court dismissed Mr. Haden's claim, he was not entitled to any damages or relief. However, the court still examined what Mr. Haden would have been awarded had liability been established and held that he would have been awarded HK$882,133.33 of which HK$60,000 was for injury to feelings and the remainder for loss of income.

Key takeaways

• Employers should not take complaints of discrimination lightly. Although Mr. Haden's claim was unsuccessful, based on the court's assessment of damages in the event liability could be established, he would have been awarded damages of HK$882,133.33. This shows that if a discrimination claim is upheld, an employer could be liable to pay a significant sum in damages.
• Always be mindful. While the term "Gweilo" is commonly used in Hong Kong, it could cause misunderstandings to those who are unfamiliar with the term. Employers should remind employees to be mindful of cultural nuances and how others may feel or react. For example, if someone expresses objection to be called "Gweilo" then one should refrain from continuing to use the term as continuing to do so might evolve into a discriminatory act.
• Employers should always keep written records of decisions made and do so in a timely manner. In this case, the Project manager documented the matters discussed in the Termination Meeting in an email after it was held, and this email was key in rebutting Mr. Haden's version of events. The Project manager was also able to promptly pull together the relevant notes and information and report back to his peers on the termination which added to the credibility of the Employer's account of events.

How we can help

We would be pleased to assist you in reviewing your employee handbook and policies on anti-discrimination and harassment. We could also provide tailored seminars or workshops to HR professionals, management and staff on how to prevent and manage claims of discrimination and harassment in the workplace.

Please reach out to us if you wish to know more.

Haden, Francis William v. Leighton Contractors (Asia) Ltd [2022] HKDC 152 – Judgment available here