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2025 MarsdenLR 6152
HIGH COURT MALAYA KUALA LUMPUR
GOH SHU WEI & ORS – Appellant
Versus
NATASYA ELMI MOHD NAWAM – Respondent
[Civil Appeal No: WA-16A-40-03/2024]
The Industrial Court can join parties to ensure enforceability of awards if a reasonable nexus exists, reflecting the principle that third parties may incur liability despite being separate legal entities.
Headnote:(A) Industrial Relations Act 1967 - Section 20(3) and Section 29(a) - Joinder of parties in constructive dismissal case - Appellants challenged the Industrial Court's decision to join them as parties to ensure enforceability of any award due to the winding-up of the Company - The court found sufficient legal and factual nexus between the parties, allowing the joinder to ensure compliance with any potential award. (Paras 3.1, 10.1, 10.2)
(B) Legal principles of joinder - The Industrial Court may join parties to proceedings if there is a reasonable factual or legal nexus, and the non-joinder would render proceedings ineffective. (Paras 8.1, 8.2)
Facts of the case:
The respondent claimed constructive dismissal from employment due to non-payment of salary and subsequent retrenchment notice. The respondent sought to join the Appellants, who were directors of the parent company, to ensure enforceability of any award against the wound-up subsidiary.
Findings of Court:
The court upheld the Industrial Court's decision to join the Appellants, emphasizing that the directors and parent company were collectively responsible for compliance with any award.
Issues: The main issues included the necessity of joining all Appellants and whether a sufficient nexus existed between them and the subsidiary.
Ratio Decidendi: The court ruled that the joinder was justified to ensure that any award would be effective and enforceable, referencing the principle that third parties can be held liable if a nexus is established.
Result: Appeal dismissed with costs.
(Enclosure 1)
Introduction
[1] The appellants filed this Notice of Appeal (L.1) to challenge the interim award of the Industrial Court Award No 471 of 2024 dated 1 April 2024 (IC Interim Award) allowing the Appellants to be joined as parties to the respondent's constructive dismissal case at the Industrial Court.
1.1 On 18 February 2025, after duly perusing the cause papers and the parties' respective submissions on the balance of probabilities, I find no merit in the appeal. I dismissed it with costs of RM5,000.00 awarded to the respondent.
1.1 Aggrieved, only the 5th Appellant (A5) appealed, and my reasons are as follows:
Background Facts
[2] On 1 April 2020 until 30 April 2021, the respondent (Natasya) was employed by Skymind Holdings Berhad (SHB), which wholly owns Skymind Education Group Sdn Bhd (SEGSB) and was its sole shareholder:
(1) On 1 May 2021, the respondent was transferred to SEGSB (the Company) and entered into an Employee Contract.
(2) All of the Appellants are directors of the 6th Appellant during the material period of the respondent's employment.
2.1 The respondent avers that the Company, in express breach of the said Employment Contract, failed, neglected and/or refused to pay her salary for April 2022 until 15 July 2022 and continues to remain unpaid until today
2.2 On 9 June 2022:
(1) The Company issued a Notification of Retrenchment dated 9 June 2022 informing the respondent that she would be retrenched effective 8 August 2022.
(2) The Company would pay her RM10,000.00 as compensation, which the respondent claimed was in bad faith.
2.3 The respondent therefore cited a breach of the material term of her employment contract and claimed constructive dismissal.
2.4 The respondent lodged a representation at the Industrial Relations Department, under s 20(3) of the IRA , 1967 and was referred to the Kuala Lumpur Industrial Court Case No: 21/4-365/23 for hearing.
2.5. On 3 August 2022, SEGSB changed its name to SEPD Sdn Bhd SEGSB was later wound up on 24 May 2023.
2.6 On 17 October 2023, the respondent applied for leave from the winding- up Court to continue with the proceedings at the Industrial Court. Leave was granted to the respondent on 2 December 2023.
At The Industrial Court
[3] On 16 July 2022, a reference was made to the Industrial Court, under s 20(3) of the Industrial Relations Act 1967 ( IRA ).
3.1 On 23 December 2023:
(1) The respondent applied s 29(a) of the IRA 1967 for an order to include SHB and five (5) directors of SHB to be joined as parties in the said action.
(2) They are:
(a) Muhammad Asyraf bin Muhammad (Joinee A) is the sole director of the present company, SPED Sdn Bhd However, it was later discontinued because, according to the claimant/respondent, he became a director on 11 August 2022 after the respondent was allegedly constructively dismissed on 16 July 2021.
(b) Goh Shu Wei (1st appellant - Joinee B).
(c) Cheng Wei Wei (2nd appellant - Joinee C).
(d) Eow Wan-Lin (3rd appellant - Joinee D).
(e) Tan Ying Siang (4th appellant - Joinee E).
(f) Datuk Yasmin Mahmood (5th appellant - Joinee F).
(g) Skymind Holdings Berhad 201801041673 (1303705-V) (6th appellant - Joinee G).
The legal foundation in her joinder application was that any Award of the Industrial Court would be rendered ineffective and unenforceable because SEGSB had been wound up unless the Appellants were added as parties.
3.2 On 1 April 2024, the Chairman of the Industrial Court (IC) allowed the 115 application vide Interim Award 471 of 2024.
3.3 Dissatisfied with the learned IC Chairman's decision, the appellants filed the present appeal against the said Interim Award in this Court.
[4] On 18 February 2025, after duly perusing the cause papers and the parties' respective submissions on the balance of probabilities, I find no merit 120 in the appeal. I dismissed it with costs of RM5,000.00
The Grounds Of The Learned IC Chairman
[5] The IC's ground of judgment (Award No 472 of 2024) and the primary consideration are as foll
