It is generally accepted that individuals who hold substantial influence or authority within an organisation are expected to exercise that power with corresponding responsibility. In particular, those whose roles enable them to shape strategic or operational outcomes are generally understood to owe duties that require them to act with integrity and in the best interests of the business, rather than pursuing personal advantages.
When an employee is also a director, the existence of fiduciary duties is well-established. However, many organisations operate with senior executives - such as Presidents, Chief Operating Officers, or Heads of Department - who hold substantial power and influence over company affairs without ever being appointed to the board. Can employers expect those individuals to look out for the company's interests at the expense of their own?
The recent decision in Law Kee Alice v Kenye Ltd and Another explores this very question and provides valuable guidance on when senior employees may be treated as fiduciaries.
The claimant, Ms Law Kee Alice, was employed by both Keyne Ltd and Mandarin Films Limited and held the position of "President". When Keyne ran into financial difficulties, she agreed to a pay cut, and a supplemental employment letter was signed in March 2022 by Keyne’s executive director and CEO, Mr Zhang Li.
When Ms Law subsequently terminated her employment because her salary had gone unpaid for more than one month (a right...
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