The employer must prove just cause for dismissal; unilateral changes to employment terms without consent can lead to a finding of unjust dismissal.

A. Reference

[1] The dispute before this Honourable Court emanates from a ministerial reference pursuant to s 20(3) of the Industrial Relations Act 1967 ("IRA 1967") arising out of the dismissal of Meor Mahadi Mat Ali (hereinafter referred to as "the Claimant") by Goldmart Sdn Bhd (hereinafter referred to as "the Company") on 7 December 2020.

B. Brief Facts

[2] The Claimant was first employed by the Company on contract basis from 5 November 2018 as a Resident Engineer. After a few renewals of the contract, the Claimant was absorbed as a permanent employee in the Company with effect from 5 June 2019 at a basic monthly salary of RM7,500.00.

[3] By a letter dated 19 November 2019, the Company imposed a unilateral mandatory salary reduction on the Claimant. According to the Company's Letter, the Claimant's salary from November 2019 until April 2020 will be reduced by 15% from his monthly basic salary and this will be repaid in May 2020 by way of salary deferment. The Claimant's appeal to the Company on his salary reduction was unsuccessful.

[4] Through a memo dated 17 March 2020, the Company imposed a No-pay Leave on its employees from 18 March 2020 due to the Movement Control Order ("MCO"). The Company also suspended its "Salary Deferment Plan" vide this memo. The No-pay Leave was then extended until 30 April 2020 by the Company through its memo dated 6 April 2020.

[5] Through another memo dated 9 April 2020, the Company informed its employees that due to the COVID-19 Pandemic and the MCO, all staff's allowances and benefits including medical insurance cards will be withdrawn. The rates for mileage claims too will be revised by the Company.

[6] By its memorandum dated 2 May 2020, the Company had notified its employees that its office shall remain closed until 13 May 2020.

[7] By a memorandum dated 8 May 2020, the Company had notified its employees that it shall be closing down all business units that are not generating sufficient revenue and staff members who are affected by the closures would be placed on temporary lay-off scheme until the global health and economic situation recovers upon which, the Company will arrange for the potential return of the staff. Through this memo too, the Company imposed the following measures unilaterally:

i. 30% across the board salary reduction for 6 months effective from 1 May 2020;

ii. Restructuring of staff benefits as in memo dated 9 April 2020;

iii. Salary Deferment Plan to be delayed; and

iv. Lay-off of employees for 6 months effective from 1 May 2020.

[8] By a letter to the Claimant dated 8 May 2020, the Company with reference to its memo dated 8 May 2020, placed the Claimant on 6 months' lay-off effective from 1 May 2020 without salary or allowances. The Company however stated that it will assist the Claimant to claim relief from PERKESO. The Company further mentioned that it will communicate the potential return date upon the expiry of the 6 months or when the global health and economic situation improves (whichever is earlier).

[9] By a letter dated 27 May 2020, the Company made an offer of a monthly sum of RM1,000.00 to the Claimant from 1 June 2020 - if provided that the Claimant reported for duty on every Monday. The Claimant did not take up this offer of the Company.

[10] Upon waiting for his return date up until December 2020, the Claimant made an enquiry to the Company as to the status of his employment.

[11] The C