The legitimacy of fixed-term contracts for foreign employees does not create a presumption of permanent employment.

Facts

[1] The parties to this case are Malaysian Philharmonic Orchestra ("the company") and Toko Inomoto and six others ("the claimants"). The proceeding before this court arises out of Honourable Minister of Human Resources reference under s 20(3) of the Industrial Relations Act 1967 on the alleged dismissal of the claimants from the services of the company.

[2] It is the company's contention that it did not dismiss the claimants and their employment with the company naturally came to an end when their respective fixed term contracts expired on 15 August 2012 due to the effluxion of time.

The Issue

[3] The primary issue to be determined is whether the claimants' employment with the company are under genuine fixed term contracts or under contracts for permanent employment but disguised as a fixed term contracts as so found in Han Chiang High School/Penang Han Chiang Associated Chinese School Association v. National Union Of Teachers In Independent Schools, W Malaysia & Industrial court Of Malaysia; [1989] 3 MLRH 449; [1990] 1 ILR 473 ("Han Chiang case").

[4] In the case of M Vasagam Muthusamy v. Kesatuan Pekerja-Pekerja Resorts World , Pahang & Anor, [2006] 1 MLJ 206, the court of Appeal held that:

"... the primary issue to be resolved in this appeal is, whether the contract of employment of the appellant with the first respondent is a genuine fixed term contract or a contract which was of a permanent nature but dressed up as a fixed term contract as so found in Han Chiang High School/Penang Han Chiang Associated Chinese School Association v. National Union Of Teachers In Independent Schools, W Malaysia & Industrial court Of Malaysia; [1990] 1 ILR 473; [1989] 3 MLRH 449."

[5] If the court comes to the conclusion that the fixed term contracts are genuine, then the issue of dismissal would no longer arise. This is because their services with the company would come to a natural end due to effluxion of time. In such situations, the company just has to notify the claimants of the fact that their employment relationship will be coming to an end, in accordance with their respective fixed term contracts. There is no need to explain the non-renewal.

[6] In the High court case of M Vasagam Muthusamy v. Kesatuan Pekerja-Pekerja Resorts World , Pahang & Anor, [2003] 5 MLJ 262, upon scrutinising the facts of the case, Faiza Thamby Chik J opined at p 894 that:

"... the Industrial court had correctly addressed the issue in this case by determining first whether or not the contract in question was a genuine fixed term contract (see pp 3 and 4 of the said award). If the Industrial court made a finding that it was not a genuine fixed term contract but was really a contract of employment, then only would the Industrial court be required to ask whether there was a dismissal or not and that if so whether it was with just cause or excuse. In the instant case, since a finding was reached that the contract concerned was indeed a genuine fixed term contract, the question of there being a dismissal or not does not arise. Once it was established that there is a genuine fixed term contract, the dissolution of the contract upon reaching the expiry date of the fixed term would clearly spell the end of the worker's tenure with the relevant company."

[7] The court of Appeal in Colgate Palmolive (M) Sdn Bhd v. Yap Kok Foong & Another Appeal, [2001] 4 MLJ 97 held that:

"Like an employee in a genuine fixed term contract of employment who leaves at the expiration of his fixed term, the retired employee has completed his engagement with his employer for a definite term on which event he gra