The court established that a failure to pay salary constitutes a fundamental breach of contract, allowing for constructive dismissal claims when the employer fails to fulfill contractual obligations.

Reference

[1] This is a reference from the Director General for Industrial Relations to the Industrial Court of Malaysia under s 20(3) of the Industrial Relations Act 1967 [Act 177] in respect of the dismissal of NUR HAZIYAH BINTI ZAINOL ABIDIN ("the Claimant") by HELIOS PHOTOVOLTAIC SDN BHD ("the Company") on 11 November 2021.

[2] This matter was initially fixed for hearing on 24 February 2023 and 8 March 2023. Both hearing dates were postponed to 9 August 2023. The Claimant and/or representative of the Claimant were present at all mention dates. The Claimant had also duly filed her Statement of Case, Bundle of Documents and Witness Statement as directed by the Court.

[3] This Court had instructed the Company to file their pleadings and documents. The Company had also been informed of the mention dates and hearing date relating to the case vide all the relevant forms, notices and letters sent to the Company at its last known address. The Company failed to file their Statement in Reply and all relevant documents despite directions given by the Court.

[4] On the day fixed for hearing ie on 9 August 2023, the representative for the Claimant and the Claimant were present but the Company and/or its representative were absent. Following thereto, the representative for the Claimant had requested to proceed with the hearing in the absence of the Company and/or its representative.

[5] The Court, exercising its power under para 29(d) of the Industrial Relations Act 1967 , proceeded to hear the case on 9 August 2023. In the absence of the Company and/or its representative, the hearing of the case concluded on the same day.

[6] In handing down this Award the following documents were considered by the Court:

(a) the Claimant's State of Case dated 9 May 2022;

(b) the Claimant's Bundle of Documents marked as CLB1;

(c) the Claimant's Witness Statement marked as CLWS-1; and

(d) the Claimant's Written Submission dated 23 August 2023.

The Claimant's Case

[7] The Claimant commenced employment with the Company on 1 May 2015 with a starting monthly remuneration of RM3,000.00. The Claimant was employed as a Quantity Surveyor by the Company.

[8] The Claimant's Appointment Letter dated 19 March 2015 contains the terms and conditions of her employment. Subsequently, vide letter dated 7 July 2017, the Claimant was promoted to the position of Senior Quantity Surveyor Grade E1 with effect from 1 August 2017 and her monthly salary was increased to RM5,000.00.

[9] The Company, vide letter dated 15 May 2020, then informed the Claimant that she will be promoted to the position of Operations Manager Grade (M2) with effect from 1 June 2020 and her monthly salary was increased to RM8,000.00.

[10] The Claimant's salary, less statutory deductions, had been paid regularly at the end of each month. This was the practice all through her tenure in the Company.

[11] However, the Company had delayed in paying the Claimant's salary for the month of July 2021. The Company had also delayed in paying the Claimant's salary for the months of August 2021 and September 2021. Up to 26 October 2021, the Company had failed to pay the Claimant's salary for the months of August 2021 and September 2021 despite the Company promising to do so. The Claimant contends failure by the Company to pay the Claimant's salary amounted to a fundamental breach of the terms and conditions of her employment.

[12] Following thereto, the Claimant, vide letter dated 26 October 2021, wrote to the Company