Gift with a hidden agenda

A branch manager of a restaurant Carl put himself in a difficult position after accepted an expensive watch from his subordinate Charles for providing preferential treatment when arranging the work schedules.
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Gift with a hidden agenda
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Carl, a branch manager at a restaurant, was responsible for arranging weekly work schedules for about ten employees.  His subordinate, Charles, hoped to get weekends off to spend time with his family.  However, the restaurant recently launched a popular dining promotion, and Carl planned to increase staffing on weekends to accommodate the higher customer volume.

To secure his desired weekends off, Charles devised a plan.  Knowing Carl was passionate about collecting watches, Charles gave him an expensive watch for his birthday, hoping to win his favour and receive preferential treatment in shift scheduling.  Touched by the gift, Carl made an exception and granted Charles his requested weekends off when arranging the work schedule. 

Since then, Charles frequently requested Carl to adjust the shifts so he would enjoy day off on weekends.  Carl found himself in a difficult position.  Having accepted the watch from Charles, he was unsure how to refuse his ongoing requests.

Case Analysis

Carl, as the employee of the restaurant, accepted the watch from Charles as an inducement to abuse his authority by favouring Charles when arranging the work schedule without the permission of the restaurant.  He might violate Section 9 of the Prevention of Bribery Ordinance (POBO) while Charles might also be guilty of the offence as the offeror of the bribe.

Although the watch was given to Carl on his birthday, it does not constitute a defence of offering bribes.  If Carl accepted the gift in relation to his official duty without the restaurant’s permission, he would be liable under the POBO.

As a managerial staff, Carl should act as a role model and set a good example for his subordinates.  Managerial staff should refrain from accepting advantages from their subordinates to avoid conflict of interest and any perception of bias, ensuring they can carry out their supervisory duties impartially.  Charles’s behaviour caused unfairness to other colleagues and affect staff morale.

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Christmas deal

Rachel, a customer service officer, treated her supervisor Rosanne to dinner and gifted her concert tickets to persuade her to avoid scheduling night shifts during the peak Christmas travel period.
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Rachel, a customer service officer at an airline company, was well aware that Christmas was a peak travel period and that she was likely to be assigned night shifts during the season.  Rachel then  privately treated her supervisor, Rosanne, who was responsible for arranging the staff duty roster, to dinner to pre-celebrate Christmas at a decent restaurant.

During dinner, Rachel gifted Rosanne with two concert tickets of an idol she knew Rosanne was interested in as a Christmas present, claiming these tickets were a gift from a friend.  She then asked Rosanne if she could avoid scheduling her for night shifts during Christmas when arranging the duty roster.  Rosanne felt hesitant about this, but Rachel repeatedly assured her that no one would know about their arrangement as long as they kept it as a secret.  Rachel also emphasised that concert tickets were not cash and that accepting them would not violate any laws.

Case Analysis

Concert tickets are advantages under the Prevention of Bribery Ordinance (POBO).  If Rosanne, without obtaining the permission of her airline company, accepted the concert tickets from Rachel for providing preferential treatment in arranging the duty roster, both Rosanne and Rachel might breach Section 9 of the POBO.

According to Section 19 of the POBO, trade custom or practice does not serve as a defence for the offeror and the acceptor of an advantage.  Although the tickets were gifts given to the supervisor during Christmas, this would not be a defence in court.  The court would only consider whether Rosanne obtained the approval from her principal when accepting the concert tickets.

As a managerial staff, Rosanne should not accept advantages or entertainment that are excessive or frequent from subordinates to prevent any perception of bias and to ensure she can carry out her supervisory duties impartially.

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Covering up the past

A unit head, Antonio, of an architect firm was about to promote a good-performed employee, Sandy, to a key post. However, he accidentally discovered that Sandy’s academic qualifications and past portfolios were fake because of a sad story.
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Upon her return to Hong Kong after a few years in the States, Sandy worked in La Fonda, an architect firm.  She had her first degree in Hong Kong but left for the US with her boyfriend soon after graduation.  Her performance in the firm was brilliant and the portfolios she submitted were excellent.  When her senior Kelly resigned, her unit head Antonio considered recommending Sandy for promotion to take up Kelly’s post.  Sandy was full of hopes.

Antonio was about to nominate Sandy. One evening, he was talking to his cousin Gamma who just returned from a long stay in the States. Gamma had been doing a doctoral programme in Architecture in the University of Vermont. Antonio causally mentioned to Gamma that his prize staff, Sandy, also worked on a second degree at the University of Vermont too.  Antonio thought that Gamma and Sandy might have met in the University because their years of study coincided. But, to Antonio’s astonishment, Gamma could not recall a Chinese lady studying Architecture during his seven years’ stay at the University, particularly as he worked part-time in the Registrar’s Office.  If Sandy had studied there, Gamma would have remembered her.

Antonio was flabbergasted and determined to look into the matter. When he went back to the office the next day, he sent for Sandy at once.  He asked Sandy if the credentials she submitted to the firm were in order. Sandy guessed what he was getting at and blurted out the truth.   

It was a sad story.  Sandy was about to be married to her boyfriend in US when she found out that he was dating another girl who could help him to get US citizenship. He tore her heart into pieces. After a few years of living only on the money sent from home, Sandy finally decided to turn over a new leaf and went back to Hong Kong.  She built up a portfolio of her own work which was in fact copied from overseas designers and made up an academic and professional history for herself.  Then she landed the job at La Fonda.

Antonio did not know what to do.  Should he expose the fraudulent past of Sandy?  Was it his duty to make sure that the firm was not cheated? Would this destroy the career of Sandy who had been a star in the firm?

Sandy had promised to work hard if Antonio kept her secret for her. Could Antonio do that with a clear conscience?

Case Analysis

Sandy, who submitted forged academic certificates and false professional history, with the intention to deceive her employer, might have already committed fraud.

Antonio was facing an ethical dilemma that might put his personal values such as compassion, responsibility and honesty to challenge. On one hand, it seems right for him to keep the secret for Sandy in view of her good potential and the reasons behind her fraudulent act; but on the other hand, he had the responsibility to protect the interest of the company and report any staff misconduct or illegal behaviour.  In handling the situation, Antonio should identify the relevant facts and take stock of all stakeholders concerned. The following factors should be taken into consideration when identifying viable alternatives and choosing the best course of action for himself:

  1. Does his decision violate any professional, industry specific, or company code of conduct?
  2. Is his decision against the law?
  3. Does it correspond with his self-values such as honesty, fairness or compassion?
  4. Can he disclose the decision to others openly and honestly without misgivings?

The ETHICS PLUS ethical decision making model might be helpful for him in solving the dilemma.

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Falsifying attendance records

In order to facilitate the engineer’s monitoring of workers’ attendance and recording of their working hours, workers were required to punch an attendance card when reporting on and off duty every day in the Engineer’s office.

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In a construction project of a commercial complex valued over $500 million, the main contractor employed ten foremen to monitor the work of sub-contractors.  A site engineer of the company, who took charge of the foremen, was responsible for the overall supervision of the project.

The salaries of the foremen and other workers were calculated on a daily basis.  Each  of  them  was  required  to  punch  an  attendance  card  when reporting on and off duty every day.  The attendance cards and the punching machine were placed in the engineer’s office so that when the foremen and other staff  reported  on  or  off  duty, they  had  to  punch  the  cards  in  the engineer’s office.  The engineer was responsible for ascertaining that his subordinates personally punched the cards.  At the beginning of each month, the engineer was responsible for calculating the salaries of his subordinates based on their individual attendance records for the previous month.  His calculations and the punched cards were then sent to the Accounts Department of the company for processing salary payment.

As the family of one of the foremen, CHAN, was in the Chinese Mainland, CHAN would seek every opportunity to travel there to visit his family.  One day, CHAN went to see the engineer and requested for three days’ off.  CHAN, however, requested the engineer not to record his leave but instead punched the attendance card for him so as to show that he was working on the three days.  In return, CHAN offered the engineer $500 for assisting him in punching the attendance card and turning a blind eye to his absence.

The engineer turned down the offer and reported the matter to the ICAC.  Eventually, CHAN was convicted for offering a bribe to the engineer, contrary to Section 9 of the Prevention of Bribery Ordinance (POBO) and was sentenced to imprisonment.

Case Analysis

Case Analysis

The foreman, CHAN, offered an advantage to the engineer (i.e. an employee and hence agent of the construction company) as a reward for assisting him to falsify attendance records, contrary to Section 9(2) of the Prevention of Bribery Ordinance (Cap.201) (POBO). Irrespective of whether the engineer accepts or rejects the bribe, the act of offering (by CHAN) already constitutes a criminal offence.  Should the engineer have accepted the bribe, the engineer would have committed a corruption offence and be charged under Section 9(1) of the POBO.    In addition, regardless of whether the engineer accepted the bribe, if he assists CHAN in falsifying the attendance record, this would amount to an offence under Section 9(3) of the POBO.  This provision stipulates that it is an offence for an employee to use any false document, receipt or account to deceive his employer.  Improper ethical behaviour may also lead to the revocation or suspension of a professional registration with a professional body and as a result the engineer would be restricted/prohibited from practice.

 

Case in Perspective

The lack of supervisory control and reliance on a manual tracking system over localised staff attendance create opportunities for personnel to abuse delegated authority, engage in unauthorised absences, commit payroll fraud, or offer bribes to secure the collusion of checking officers.  To address this problem, the main contractor should establish a system to strengthen attendance tracking and staff administration by implementing the following control measures –

(a) Eliminate susceptible manual systems and implement a digital attendance management system (e.g. fingerprint or facial recognition);

(b) In the interim, supplement manual systems with CCTV to authenticate staff presence, deter impersonation and provide verifiable records of attendance; and

(c) Conduct surprise on-site spot checks and physical headcounts to verify real-time worker presence by supervisors and/or independent units. 

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Ghost workers

Bobby, a site foreman, accidentally discovered the irregularities in attendance of the construction workers, which should be routinely checked by his subordinate. Bobby was struggling between reporting the matter to the engineer or covering up his own mis-management.
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Clint was a construction engineer at a private housing estate construction site. He had spent most of his time mingling with foremen and construction workers.

Bobby, a site foreman, was working with Clint on the project.  Bobby had an assistant, Chui, who had been his right hand man for many years. On the day, Chui fell ill and Bobby took over the routine check of books and accounts.  He suddenly saw the names of two workers whom he did not recall seeing on the site the day before marked into the attendance book.  He thought it was a mere error of entry but to make sure, he summoned the two workers to come and see him.

When the two workers showed up, Bobby was amazed to see that they were totally unabashed.  They admitted outright that they had been absent the day before and that their chums had clocked in their attendance cards for them.  They were even brazen enough to put forth a number of points to justify what they had done.

They claimed that attendance at work did not necessarily mean that the progress would be faster.  The guys needed time-out and rest in order to restore their strength after their leave days and therefore they could work hard to compensate for the day lost.  The productivity would be higher.  And they had never let Bobby down, had they?  This had been a system drawn up by the workers and everybody knew about it, seeing it as an incentive to their work or even a bonus.  Bobby was aghast.

Worse still, the phone rang at that time.  It was Clint.  He wanted to check out with Bobby about the expenses and asked him to file the site accounting report.

Bobby was at a loss as to what to do.  He wondered how much Chui was involved in this.  If Chui was in the know all along, then he himself would be an incompetent fool not to realise that this was going on under his nose. On the other hand, he did not wish to antagonize his men.  What should he do?

Should he report to Clint and blow the whistle?  Or should he stand by his men, including Chui?   Would it reflect badly on him either way?

Case Analysis

Chui and the construction workers, as employees of the construction company, submitted the false attendance records with the intention to deceive salaries from their employer had violated Section 9(3) of the Prevention of Bribery Ordinance (POBO).

Bobby was facing an ethical dilemma that might put his personal values such as responsibility and honesty to challenge. On one hand, he had the supervisory responsibility to report the misconduct of the workers to the company; on the other hand, it might reflect badly on him if Clint learnt that he failed to discharge his supervisory duties properly. In handling the situation, Bobby should identify the relevant facts and take stock of all stakeholders concerned. The following factors should be taken into consideration when identifying viable alternatives and choosing the best course of action for himself:

  1. Does his decision violate any professional, industry specific, or company code of conduct?
  2. Is his decision against the law?
  3. Does it correspond with his self-values such as honesty and responsibility?
  4. Can he disclose the decision to others openly and honestly without misgivings?

The ETHICS PLUS ethical decision making model might be helpful for him in solving the dilemma.

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Who has robbed my hard-earned money? (Cantonese only)

Who has robbed my hard-earned money?
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The achievements of Hong Kong’s construction industry are certainly attributed to the strenuous efforts of frontline workers. However, in recent years, the ICAC has investigated many cases of illegal "referral fees" in the construction industry.

Workers have not only been solicited illegal referral fees by foremen when finding jobs, they have also been asked for money even after employment, like the following scenario ...

Foreman: Hey dude, having lunch?

Worker: Yes

Foreman: Let me remind you, after receiving your first paycheck, remember to "refund" me as part of our trade practice. Let me take a bite

Worker: Refund you from my paycheck is a trade practice… Snatching my food is also a trade practice?

Foreman: It's not just about the trade practice, look at your awful craftmanship. Pay me quickly so that I can find someone to clean up your mess. Do you understand?

Worker: Blame me before the work is even done, It's an obvious blackmail

Foreman: Sorry, I chugged it.

Foreman: Woh, breakfast

Worker: Good morning

Foreman: Give it to me

Worker: The breakfast is mine

Foreman: I haven't had breakfast yet, and I feel so hungry

Worker: But it's mine…

Foreman: So what?

Worker: It's mine…

Foreman: I play by rules and never take things from others. You are an unskilled worker but getting paid as a semi-skilled worker. Remember to return me the differences you earn. Don't forget to return me the differences!

Worker: What differences?

Foreman: Are you kidding me? You don't know what the differences are? Do you want to live paycheck to paycheck? Do you want to resign? Just let me know!

Worker: No

Foreman: That's good

Foreman: Rebate me, trade practice, awful craftmanship

Worker: Huh, I work around the clock just for making ends meet, but this Foreman still deprives me with various excuses

The foreman made use of his position to demand advantages from a frontline worker and threatened him with job loss or termination should he refuse to comply. The solicitation for a bribe by the foreman might have already breached the "Prevention of Bribery Ordinance". The worker might also have breached the law if he agreed to the foreman’s request so as to keep his job.

A bribery act involves acceptance of “advantage”, which is defined by the law as almost anything of value. There is no monetary limit to the definition of advantage, so do not think that a trivial amount of "tea money" or "rebate" would not commit an offence. 

Although the foreman claimed that the "rebate" is just a trade practice in the construction industry, this is not a defence if it involves corruption. Both the offeror and recipient of a bribe will breach the law. The maximum penalty for violating the "Prevention of Bribery Ordinance" is 7 years' imprisonment and a fine of $500,000.

If you suspect that someone has committed corruption or solicited bribes from you, you should refuse immediately and report to the ICAC as soon as possible. 

Reporting corruption is very easy and there's no need to make an appointment. All reports will be handled in strict confidence.

24-hour Report Corruption Hotline: 25 266 366

Import Data

[EN] Who has robbed my hard-earned money? (Cantonese only) Link: https://www.youtube.com/watch?v=2Cx3cGkmrFM Intro: Who has robbed my hard-earned money? Transcript: https://hkbedc.icac.hk/en/doc?id=57§ion=videos&content=content [ZH-HANT] 堅拒非法介紹費 Link: https://www.youtube.com/watch?v=2Cx3cGkmrFM Intro: 堅拒非法介紹費 Transcript: https://hkbedc.icac.hk/en/doc?id=57§ion=videos&content=content [ZH-HANS] 坚拒非法介绍费 Link: https://www.youtube.com/watch?v=2Cx3cGkmrFM Intro: 坚拒非法介绍费 Transcript: https://hkbedc.icac.hk/en/doc?id=57§ion=videos&content=content

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