Non-payment of salary during probation constitutes constructive dismissal, entitling the employee to backwages limited to three months' salary.

AWARD

Salahudin Hidayat Shariff:

Reference:

[1] This is a reference dated 21 February 2023 made by the Director General of Industrial Relations pursuant to s 20(3) of the Industrial Relations Act 1967 [Act 177] arising out of the dismissal of Ramesh Madhavan ("the Claimant") by Elaies Expert Sdn Bhd ("the Company") on 26 August 2022.

Brief Facts

[2] The Claimant resigned from his work in a different palm oil estate to take the new job offered in this case. He was appointed via a letter of Appointment dated 11 November 2021 entitled Appointment as Manager of (Barakah Realty Sdn Bhd) Jeli, Kelantan by the Company. There was no effective date expressly provided in the letter, but it mentioned that the Claimant was on probation. However, it was stated that the Claimant's Annual increment date would be on 1 January 2023. The Claimant accepted the offer on 18 November 2021. This letter had enclosed an eight-page appendix with a Schedule of Terms of Employment of Executive Staff.

[3] The Company was acting as the Managing Agents for Barakah Realty Sdn Bhd ("Barakah"). The Company was specifically appointed to manage Barakah's oil plantation of Ladang Sawit Lubok Bongor, Jeli, Kelantan. On 30 December 2021, Barakah wrote a letter to the Company informing the Company that Barakah has yet to obtain the lease for the plantation land from the State Government but was still going ahead with it. The Company wrote directly to the Claimant informing the same.

[4] The Company then informed the Claimant vide letter dated 21 January 2022, regarding further delays in the commencement of work and it is understood that the lease may be commenced on 1 April 2022. The letter also informed the Claimant that the Management had requested the HQ to pay 50% of the remuneration for the staff.

[5] On 27 January 2022 the Claimant wrote to the Managing Director of the Company expressing his shock regarding the delay and the fact that the Claimant would not be paid in full for the delayed months.

[6] Then, the next correspondence in the bundle of documents was dated 1 September 2022 where the Company's agreement as a Managing Consultant and Managing Agents was revoked by Barakah. This date is not objected by any party and happened six days after the Claimant's letter for constructive dismissal. Whether the two are related in the case will be looked into further down the Award.

[7] The above are all the correspondences that were filed in Court . The Court has gone through all the above evidence as well as the evidence given through testimony in Court and submissions that have been filed. Those documents and submissions are listed for ease of reference as follows:

(i) Statement of Case dated 5 April 2023;

(ii) Statement in Reply filed on 24 May 2023;

(iii) Rejoinder dated 16 February 2022;

(iv) Claimant's Bundle of Documents filed on 6 April 2023 marked as exhibit CLB-1;

(v) Claimant's Bundle of Documents (2) filed on 14 March 2024 marked as exhibit CLB-2;

(vi) Company's Bundle of Documents filed on 26 May 2023 marked as exhibit COB-1;

(vii) Claimant's Witness Statement signed on 25 March 2024 marked as exhibit CLWS-1;

(viii) Witness Statement of Company signed on 25 March 2024 marked as exhibit COWS-1;

(ix) The Claimant's Written Submissions dated 14 June 2024;

(x) Claimant's Bundle of Authorities filed on 18 June 2024;

(xi) The Company's Written Submissions dated 14 June 2024;

(xii) The Company's Bundle of Authorities filed on 21 June 2024;

(xiii) The Claimant's Written Submissions in Reply dated 28 June 2024;

(xiv) Claimant's Bundle of Authorities filed on 2 July 2024; and

(xv) The Company's Reply Submissions dated 27 June 2024.

[8] Since this is a constructive dismissal case, the case was started by the Claimant according to the accepted norm.

The Decision

The Role Of The Court

[9] Before proceeding with the full award, the Court reiterates its stand regarding the role of the Court in a matter referred under s 20(3) Act 177. The Court has raised this in the reported cases o