Clifford Chance

Hong Kong court affirms employers' wide discretion in relation to bonus decision and contractual right to terminate without cause

8 October 2024

The Court of First Instance (CFI) in Hong Kong has recently handed down a decision concerning a financial institution employer's decisions to issue a written warning for an employee's conduct, award zero bonus subsequent to such warning, and terminate his employment for redundancy. The Plaintiff employee's claims against the Defendant employer were dismissed. The decision confirms an employer's wide discretion in relation to bonus decisions, and also affirms the long-established principle that where a contract of employment provides for the parties' right to terminate without cause, such right can be exercised "for no, good or bad reason". Clifford Chance acted for the successful Defendant in this case.

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