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2022 MarsdenLR 725
COURT OF APPEAL PUTRAJAYA
GOPALA KRISHNAN CHETTIAR MUTHU – Appellant
Versus
SEALAND MARINE INSPECTION AND TESTING (M) SDN BHD – Respondent
[Civil Appeal No: W-01(A)-419-09/2020]
A company director can also qualify as a 'workman' under the Industrial Relations Act 1967, allowing them protection against unfair dismissal.
Headnote:(A) Industrial Relations Act 1967 – Section 2 – Judicial Review – Definition of 'workman' – The Appellant, a director and shareholder, was determined to be a 'workman' under the Act. Dismissal without just cause was established despite the Company’s claims of independent control. The Industrial Court's findings were reinstated after the High Court quashed its Award on a flawed legal basis. (Paras 51-93)
Facts of the case: The Appellant was terminated as Operations Director and claimed constructive dismissal. The Industrial Court ruled him a 'workman', so he was entitled to protection under the relevant provisions. (Paras 1-4)
Findings of Court: The Court found the Appellant was performing employee functions and the Company failed to justify the dismissal on just grounds. (Paras 48-49)
Issues: The core issues revolved around the definition of 'workman' in relation to a director's role and the justification for the Appellant's dismissal. (Paras 21-22)
Ratio Decidendi: The Court emphasized the interpretation of 'workman' should be liberal, as set forth in prior case law, allowing for a director to also be classified as an employee when fulfilling such duties. (Paras 58-60, 86)
Result: Appeal allowed; the Industrial Court's original Award reinstated, and compensation awarded. (Paras 92-93)
JUDGMENT
Introduction
[1] This is an appeal by Mr Gopala Krishnan Chettiar Muthu ("Appellant") against the decision of the Learned Judge of the High Court dated 29 July 2020("Judge") in allowing an application for Judicial Review by the Sealand Marine Inspection and Testing (M) Sdn Bhd (Company No 1207748-U) ("the Company") and granting an order of Certiorari to quash the Industrial Court of Malaysia Award No 2245 of 2019 dated 8 August 2019 ("the Award").
[2] The issue which featured prominently in the appeal before us was whether the Appellant, although a director and shareholder of the Company, was also a "workman" per the definition in s 2 of the Industrial Relations Act 1967 ("the Act"). In this regard, the Industrial Court precisely framed the question as follows:
[21] The central question that this Court needs to determine is whether the Claimant who holds the position as a Director and shareholder of the Company in his capacity as an Operation Director is also a workman/employee of the Company?
[3] Based on the evidence that was adduced, the Industrial Court ruled that the Appellant was a "workman" and that he had been dismissed without just cause or excuse. The Industrial Court ordered compensation in the sum of RM320,000.00 to be paid by the Company to the Appellant. The Company challenged the Award by a Judicial Review application. The High Court granted Certiorari and quashed the Award. The Appellant appealed to this Court.
[4] On 5 October 2022, we allowed the appeal and set aside the High Court's Order dated 29 July 2020. We reinstated the Award of the Industrial Court. We ordered costs of RM20,000.00 (subject to allocatur) to the Appellant as costs here and below. Our reasons for allowing the appeal now follow.
Background
[5] The Appellant had previously worked at Links Survey (M) Sdn Bhd He had been involved with the logistics and shipping industry since 1998 and was experienced in marine cargo surveying and loss adjusting. The Appellant's experience was relevant to the Company's core business, which is marine cargo surveying and inspection. The Appellant was known to one Sathiaseelan ("Sathia") long before he joined the Company which was incorporated on 3 November 2016. Sathia was a director/shareholder and the executive director of the Company.
[6] Apart from the Appellant and Sathia, the other directors in the Company were Ong Keng Hsing ("Ong"), SM Malarshobaa ("Malarshobaa"), and David Rajan Padman ("David"). It is relevant to mention also that the Company was associated with 2 other companies namely, Northwest Marine Sdn Bhd (Co No 944374- U) ("Northwest") and Sealand Marine and Inspection (M) Sdn Bhd (Co No 723806-W) ("old Sealand"). Sathia, Ong and Malarshobaa are also directors in Northwest and old Sealand. All or most of the staff who worked at the Company were from old Sealand. After the Appellant's removal/termination on 12 March 2018, the Company closed down and ceased business, the staff (sans the Appellant) were absorbed into employment by Northwest.
[7] The shareholding in the Company was as follows:
[8] The Appellant joined the Company on 3 November 2016. The Appellant was appointed to the Board of Directors of the Company and was "given" 20,000 shares in the Company. He did not pay for the shares. It seems that the Appellant was brought into the Company because of his vast experience in marine cargo surveying and loss adjusting.
[9] There was considerable dispute before the Industrial Court as to the Appellant's role, and whether he was in total control and worked independently and brought in to develop the Company's business and bring in new clients, apart from servicing existing clients. The Appellant maintained that he was not in total control of the Company and that sales and marketing was not part of his portfolio as he was brought in to be in charge of operations.
[10] The Appellant testified that he had closely monitored the job allocations to the staff and the drafts of the surve
