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The recent Labour Tribunal decision involving a claim made by three Cathay Pacific flight attendants illustrates the application of the Employment (Amendment) Ordinance2007 (‘Amendment Ordinance’) which came into force on 13 July 2007.The aim of the legislation is, in part ,to ensure that business are better equipped to determine which payments to employees should (and should not) be included in the Calculation of “wages” when determining pay for certain statutory entitlements. InSpite of this ,the Amendment Ordinance appears to have left a number of questions unanswered.
By way of background, the facts and outcome of the decision was as follows. Three Cathay Pacific flight attendants claimed against the airline over their holiday pay entitlements from 2002 to 2008 and had a partial victory in the Labour Tribunal. The Tribunal ruled that line-duty and ground duty allowances, and commission earned from selling duty-free goods (where applicable)should be included in the calculation of holiday pay. However, the Tribunal ruled in the airline’s favor that it does not need to include the overnight or out-port allowances, which flight attendants were paid to cover expenses incurred while they stay overseas between flights, because they were sums payable to the employee to defray special expenses incurred by him by the nature of his employment and therefore were not ‘wages’ for the purpose of calculation of holiday pay.