Faiza Tamby Chik J:

[1] The senior labour officer, Pelabuhan Kelang, made an order on 20 September 1995 that the appellant in this case paid the respondents a total sum of RM194,122.05 being termination benefits as claimed by the respondents (p 20 Rekod Rayuan (RR)). This is an appeal against the whole of that decision by the appellant.

[2] The claims to the termination benefits, which arose under the Employment (Termination and Lay-Off Benefits) Regulations 1980 were made under s 69 of the Employment Act 1955.

The Relevant Facts

[3] The respondents were employed by the appellant company on various duties, positions and salaries, to work at its sole factory in Shah Alam. The appellant, by a notice dated 17 September 1994, informed the respondents that the business premises would be relocated to Ipoh, Perak around 1 December 1994 (p 25 - RR). By a further notice dated 27 September 1994, the appellant confirmed that the relocation to Ipoh would not involve any changes to the other terms and conditions of employment of the respondents. (p 27 - RR). The respondents were finally instructed by a notice dated 24 February 1995 that the shifting of the premises had been completed and that the appellant should report for work in Ipoh on 1 March 1995. (p 25 - RR).

[4] The respondents worked in the Shah Alam factory until 28 February 1995 on which day, the appellant paid the respondents full wages for February 1995 together with payments for balance of annual leave and unutilised medical leave.

[5] The respondents did not report to the new factory in Ipoh on 1 March 1995 but instead filed their claims for termination benefits in the Labour Department in Port Klang.

[6] It is in evidence that the respondents had informed the appellant that they would not report for work in Ipoh (p 11 - RR). It is also in evidence that the appellant knew that the respondents did not want to go to Ipoh (p 17 - RR). No letter of termination was issued to the respondents, nor any form of action taken against them for not reporting for work in Ipoh. There were no written Terms and Conditions of Employment (p 19 - RR)

The Issues

[7] The issues are:

(i) The appellant's right to relocate their business premises;

(ii) The effect of such a relocation on the contract of employment of the respondents with regard to s 12(3) of the Employment Act 1955.

(iii) Consequent entitlement to Termination Benefits under regs 4 & 6 of the Employment (Termination and Lay-off Benefits) Regulations 1980.

Transfer/Relocation

[8] It must be noted that the movement of an employee from one place of work to another may be due to a transfer or a relocation of the business premises. In All Malayan Estate Staff Union v. Golden Hope Plantations Bhd & Anor, [1994] 2 MLJ 699, the High Court held:

Since the Minister's reference concerned the relocation of the employees, the issue of transfer was outside the scope of the reference. Therefore the Industrial Court had correctly confined itself to the issue of relocation.

[9] The right to transfer an employee was stated in Industrial Court Award No 314/87 between Hotel Perdana Kelantan v. National Union of Hotel, Bar and Restaurant Workers; [1987] 2 ILR 330 at p 331 as:

It is well settled that the right to transfer an employee from one department to another, or from one post of the establishment to another or from one branch to another is the prerogative of the Management.

[10] In short a transfer involves the movement of any employee within the divisions of an organisation which have been established at the time the contract between the parties were concluded and is distinguishable from a relocation of the business premises itself. Ghaiye BR in his book - Misconduct in Employment (2nd edn) at p 276 submitted that a shifting of place of business does not amount to a transfer. That is, a transfer as illustrated from the three situations above, is totally different from where an employer shifts his place of business or his undertakings from one place to anothe