A claimant classified as an independent contractor under a service contract lacks the protections of a 'workman' under the Industrial Relations Act despite claims of wrongful dismissal.

[1] This is a reference by the Honourable Minister of Human Resources made under s 20(3) of the Industrial Relations Act 1967 regarding the dismissal of Arun Kumar Bag ("the claimant") by Hospital Pantai Indah Sdn Bhd ("the company") on 28 February 2006.

Background Facts

[2] The company operates a private hospital known as Hospital Pantai Indah ("the hospital"). The claimant in response to the advertisement of the company for, inter alia, full time Resident Consultant Obstetrician and Gynaecologist applied for a job with the company which was then about to set up the hospital. At the interviews, the claimant was told that he had to cease his private practice in his private clinic and be a full time Resident Consultant Obstetrician and Gynaecologist in the hospital. After the interviews, the claimant was given two copies of "Consultant Agreement" ("CA") to sign. The claimant signed the CA dated 31 December 2002 and commenced his job as full time Resident Consultant Obstetrician and Gynaecologist on 6 January 2003.

[3] The terms of the CA include the following matters:

(a) The claimant has accepted the company's offer for him to be appointed as a consultant in the discipline of Obstetrics and Gynaecology upon the terms and conditions appearing in the CA (recitals 3 and 4 at p 1 of the CA).

(b) The claimant must comply with and abide by the rules, regulations, policies and procedures as may be prescribed by the company from time to time as are consistent with the terms of the CA and which the claimant agrees (cl 3(b) at p 3 of the CA).

(c) The claimant is not to practice or accept any appointment or engagement to practice at any other hospital or clinic except with the written consent from the company's Board of Directors or authorised personnel (cl 3(i) at p 4 of the CA).

(d) All professional fees charged by the claimant in respect of inpatient and outpatient treatment shall be billed, collected and received by the company and the company will charge the claimant an amount equivalent to 10% of the claimant's gross total income per month as administrative charges (cl 4.2(i), (ii) read together with Sch B/1 at pp 6 and 23 of the CA).

(e) The CA shall be for a duration of three years commencing from 6 January 2003 (cl 8(a) at p 8 of the CA).

(f) If the claimant wishes to continue his appointment beyond the three-year period, he shall apply to the company in writing and any subsequent appointment is subject to the approval of the company (cl 8(b) at p 8 of the CA).

(g) In order to practice, the claimant also sub-let from the company a clinic space subject to the terms and conditions in the CA. The claimant paid the company rental for the clinic space in the sum of RM2,500,00.00 per month (cl 8(c) read together with Sch A at pp 8, 9 and 18 of the CA).

(h) The claimant shall be an independent contractor and not an agent, servant or representative of the company (cl 11(a) at p 11 of the CA).

(i) The claimant shall be personally liable for any acts of negligence or omission committed by himself and he shall indemnify the company against any loss or damage suffered by the company in respect of any claims or actions brought against the company arising out of the claimant's negligent acts (cl 11(b) at p 11 of the CA).

(j) The claimant shall not be paid any salary or allowance nor is he entitled to any statutory benefits or contributions which are otherwise paid or provided to the employees of the company (cl 11(c) at p 11 of the CA).

(k) In the event of any dispute or difference arising between the parties in reference to the terms of the CA, the same may be referred to arbitration r