Hong Kong
Breach of fiduciary duties by diverting away business (case law)
Impact date: 16 June 2026 In Eventmaster Limited v Chen Hiu Kwan & Ors [2026] HKCFI 3380, Eventmaster, a Hong Kong event technology services company, sued its former business director (D1), former account manager (D2), their competing company (D3), and another former account manager (D4). Eventmaster alleged that D1 and D2 incorporated D3 in April 2019 while still employed, diverted business opportunities and misused confidential information through D3, and after departing, induced D4 to channel Eventmaster's business to D3 until her termination in May 2020.
The Court found all individual defendants liable for breaching their fiduciary duties, duties of fidelity, and duties of confidence by operating D3 in competition with Eventmaster and misusing confidential pricing and client information across multiple clients. D1, D2 and D4 were additionally held liable for dishonest assistance, conspiracy to injure by unlawful means, and (in D1's case) inducing D4's breach of contract. Applying a loss-of-chance formula, the Court awarded HK$223,097 jointly and severally against D1–D3 and a further HK$59,042 jointly and severally against D1–D4.
Employer implications/action needed For employers, this decision confirms that while employees may take preparatory steps for future employment, they must not solicit clients, prepare competing quotations, divert business opportunities, or operate a competing business during employment. Notably, the Court held that fiduciary duties can extend beyond senior management to client-facing and sales employees, given their roles and access to business opportunities. Employers should clearly document these expectations in employment contracts and policies.
The case also reinforces that confidential information attracting legal protection is broader than trade secrets, encompassing customer contacts, pricing information, quotations, and tender opportunities. Employers should use clear confidentiality clauses and restrict access to sensitive information. Critically, the Court relied heavily on contemporaneous records (emails, quotations, WhatsApp messages and salary/MPF records) to establish the timeline of breaches. Proper record-keeping remains critical when enforcing rights.
Employer risk Business diversion by departing employees remains a significant threat, particularly where employees retain access to client relationships and pricing data during notice periods. The risk is heightened when remaining employees are induced to covertly assist former colleagues, or channel business opportunities and confidential information to a competitor while still employed by the company.
Legislative proposal to improve the work injury compensation mechanism for digital platform workers
Impact date: Meeting at the Legislative Council Panel on Manpower on 17 July 2026, with the introduction of the legislative proposal into the Legislative Council planned for later in 2026. The Hong Kong Government has outlined a legislative framework to establish a statutory work injury compensation (WIC) mechanism for digital platform workers in the food and goods delivery sector. The legislation defines "platform operators" and "platform workers" based on task management and automated control, requiring operators to take out statutory WIC insurance, report work accidents, and maintain earnings records. Furthermore, it extends safety nets such as the Employees Compensation Assistance Fund and the Employees’ Compensation Insurance Residual Scheme to cover platform workers.
The proposal forms part of a broader government focus on the regulation of the platform economy, including the introduction of a licensing framework for ride-hailing services and drivers expected to take effect from 2026.
Employer implications/action needed Affected platform operators should develop policies to specify the rights and benefits for the workers covered by this future legislation. They should also ensure compliance with the new registration and reporting obligations and promote transparency in the terms and conditions applicable to platform workers.
Employer risk Platform operators should monitor the legislative developments closely to ensure compliance with the relevant requirements, such as taking out mandatory WIC insurance, maintaining accurate records, and reporting work injuries sustained by platform workers to the Labour Department.
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