Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2023 MarsdenLR 1478

INDUSTRIAL COURT KUALA LUMPUR
WONG THAI PING – Appellant
Versus
MRCB BUILDERS SDN BHD – Respondent
Award No: 1623 Of 2023 [Case No: 6(15)(6)/4-1990/21]

Petitioner Advocates:Chua Heaw Eng ,Respondent Advocate: Dato' Thavalingam C Thavarajah,Mannvir Baljit Singh

The dismissal of an employee for redundancy must be genuine, with the employer demonstrating just cause and adherence to accepted procedures, particularly in extraordinary circumstances like a pandemic.

Headnote:(A) Industrial Relations Act 1967 - Section 20(3) - Unfair dismissal - The Claimant was terminated due to redundancy following a restructuring exercise amidst the COVID-19 pandemic - Claimant's role deemed redundant as his position was the last in - Company demonstrated genuine need for reorganization and complied with accepted standards during retrenchment. (Paras 1, 9, 34, 39, 119)

(B) Redundancy - The court emphasized that redundancy occurs when an employee's position is no longer necessary for the business - The employer must act bona fide and not capriciously in making redundancy decisions. (Paras 40, 76, 100)

(C) Burden of proof - In unfair dismissal cases, the burden lies with the employer to prove that dismissal was with just cause. (Paras 36, 38)

(D) Consultation - No legal obligation exists for the employer to consult employees prior to retrenchment, especially during extenuating circumstances such as a pandemic. (Paras 114, 115) (E) Compensation - The Claimant was awarded ex gratia payment despite no contractual obligation, reinforcing the bona fides of the retrenchment exercise. (Paras 116, 118)

Facts of the case:
The Claimant was employed as Manager M & E and was retrenched on 31 July 2020 due to the redundancy of his position resulting from the Company's restructuring amidst COVID-19. The Company faced severe financial losses and implemented cost-cutting measures, including the termination of employees deemed surplus. (Paras 9, 14, 20, 34)

Findings of Court:
The Court found that the Claimant's termination was justified based on the evidence of redundancy and the Company's compliance with legal standards during the retrenchment process. The Claimant's case was dismissed. (Paras 119, 121)

Issues: The main issues included whether the Claimant's dismissal was with just cause, whether a genuine redundancy situation existed, and whether the Company complied with accepted procedures in the retrenchment process. (Paras 34, 39, 112)

Ratio Decidendi: The Court ruled that the Company acted within its rights to restructure and that the Claimant's role was genuinely redundant, thus justifying the dismissal. The Company was found to have acted in good faith and adhered to the necessary legal standards. (Paras 119, 120)

Result: Claimant's case is hereby dismissed.

Table of Content
1. dismissal due to redundancy amid pandemic (Para 1 , 2 , 9 , 10 , 11)
2. claimant's employment history and termination issues (Para 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21)
3. company's justification for retrenchment (Para 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31)
4. court's role in determining just cause for dismissal (Para 33 , 34 , 35 , 36 , 37 , 38)
5. definition and principles of redundancy (Para 39 , 40 , 41 , 42 , 43 , 44)
6. evidence of company's financial condition (Para 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54)
7. testimonies regarding redundancy and selection process (Para 55 , 56 , 57 , 58 , 59 , 60 , 61 , 62 , 63 , 64)
8. claimant's acknowledgment of genuine retrenchment (Para 67 , 68 , 69 , 70 , 71)
9. court's assessment of restructuring necessity (Para 73 , 74 , 75 , 76 , 77 , 78 , 79 , 80 , 81 , 82)
10. evidence of financial hardship justifying retrenchment (Para 83 , 84 , 85 , 86 , 87 , 88 , 89 , 90 , 91)
11. application of last in first out principle (Para 92 , 93 , 94 , 95 , 96)
12. existence of redundancy and job function cessation (Para 97 , 98 , 99 , 100 , 101)
13. final assessment of redundancy and dismissal (Para 102 , 103 , 104 , 105 , 106 , 107 , 108 , 109 , 110 , 111)
14. final judgment on dismissal validity (Para 119 , 120)

Amrik Singh:

Reference

[1] This is a reference by The Honourable Minister of Human Resources, Malaysia to the Industrial Court of Malaysia pursuant to s 20(3) of the Industrial Relations Act 1967 ('the Act') in respect of the dismissal of Wong Thai Ping (hereinafter referred to as "the Claimant") by his employer MRCB Builders Sdn Bhd (hereinafter referred to as "the Company") on 31 July 2020.

[2] Besides the Claimant, the reference letter includes four other employees of the Company namely Azrul Bin Idrus, Lee Chan Keong, Noraini Binti Haron and Rozaimeerezeam Bin Abdullah who were all dismissed by the Company on the same date as the Claimant in the same retrenchment exercise. Amongst the five individuals, the Claimant, Azrul Bin Idrus, Lee Chan Keong and Rozaimeerezam Bin Abdullah had pursuant to the Ministerial reference file unfair dismissal claims against the Company and proceeded to have their cases heard in full trial.

Preliminary

[3] By consensus among parties, the Claimant's case was heard together with Lee Chan Keong's [2023] MELRU 1588 case No: 6(15)(6)/4-1987/21 and Rozaimeerezam Bin Abdullah case No: 6(15)(6)/4-1989/21 in a single trial as the Company's Head of Human Resource was called to testify as a witness in all three cases with Dato' Thavalingam C. Thavarajah (Mannvir Baljit Singh with him) from Messrs T Thavalingam & Co representing the Company in each case. Hence, the reason all the three (3) cases were tried together, for the convenience of all parties and to save the Court's time. As the three (3) cases were not consolidated, but were all heard in one trial before the former Learned Chairman of Court 15 who had since retired, I was directed to hand down separate awards for all the three cases after the files of these cases were transferred to Court 6.

[4] The trial of the three (3) cases commenced on 10 August 2022 and completed on 16 January 2023 and by the time I was directed to hand down the awards for all the three cases, the expected time line of ninety days for an Industrial Court award to be handed down had exceeded. I am therefore, duty bound to ensure that the handing down of these awards be prioritised.

[5] At the outset, learned counsel for the Company informed the Court that in all three matters, the Company has two witnesses for each case, whereby one of the witness will testify on the financial aspects of the Company in all three cases and the second witness in each case will be a different witness as different persons in the Company were involved in the selection process for retrenchment of the employees.

[6] In handing down this Award, reference and reliance on the notes and records of proceedings by the former Chairman was

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2023 MarsdenLR 1478

INDUSTRIAL COURT KUALA LUMPURWONG THAI PING – AppellantVersusMRCB BUILDERS SDN BHD – RespondentAward No: 1623 Of 2023 [Case No: 6(15)(6)/4-1990/21]

The dismissal of an employee for redundancy must be genuine, with the employer demonstrating just cause and adherence to accepted procedures, particularly in extraordinary circumstances like a pandemic.

Cases Referred (5)

INDUSTRIAL COURT KUALA LUMPUR
WONG THAI PING – Appellant
Versus
MRCB BUILDERS SDN BHD – Respondent
Award No: 1623 Of 2023 [Case No: 6(15)(6)/4-1990/21]