Back
2022 MarsdenLR 2351
INDUSTRIAL COURT IPOH
NALLIAH DAVID PRAGASAM – Appellant
Versus
AIMST SDN BHD – Respondent
Award No: 2494 Of 2022 [Case No: 10/4-424/20]
The court held that retirement at age 60, as per policy, does not constitute unlawful dismissal, emphasizing employer-employee relationship clarity.
Headnote:(A) Industrial Relations Act 1967 – Section 20(3) – Claim of wrongful dismissal – The Claimant asserted he was dismissed without cause; however, the Court found he was never an employee of the Company but rather of AIMST University, thus his claim was against the wrong party – The Claimant reached retirement age of 60, leading to the natural end of his employment – The principle of equitable treatment in employment was emphasized, confirming that avoidance of employment due to unjust cause must be adequately proven by the Claimant (Paras 68-74).
(B)
Employment relationship – The Court determined the Claimant's status was linked solely to AIMST University, dismissing claims made against AIMST Sdn Bhd, whose employment relationship was non-existent (Paras 68).
(C)
Fixed-term contracts – Court discussed applicability of retirement age across employment policies, asserting that the policies were binding based on the Claimant's previous acknowledgments (Paras 49-55).
AWARD
Reference:
[1] This is a reference by the Honourable Minister of Human Resources pursuant to s 20(3) of the Industrial Relations Act 1967 dated 6 January 2020 which was received by the Industrial Court on 17 February 2020 arising out of the alleged dismissal of Nalliah David A/L Pragasam (hereinafter referred to as "the Claimant") by AIMST Sdn Bhd (hereinafter referred to as "the Company") on 19 September 2019.
Factual Background:
[2] The Claimant commenced an employment with Asian Institute of Medicine, Science & Technology (AIMST) to the position of part time Finance Officer effective from 1 April 2001 till completion of all formalities pertaining to optional retirement from government service vide a Letter of Employment dated 24 March 2001 (at p 9 of COB-1). Upon formal retirement as government servant, the Claimant will assume as Finance Executive II on a full time basis. The Claimant will be required to undergo a probationary period of three (3) months / one semester which may extended or reduced at the sole discretion of AIMST.
[3] The Claimant had accepted the offer of employment by AIMST on 27 March 2001 and the Claimant continued to be employed as Assistant Bursar until 19 September 2019 whereof by the time of his termination, the Claimant was receiving a monthly salary of RM14,727.50.
[4] The dispute between the parties is over the purported termination of the Claimant's services on 19 September 2019 by the Company as the Claimant's services with AIMST University came to end by reason of the Claimant reaching age of sixty (60) years old.
The Company's Case:
[5] The Company contends at the outset that the Claimant was never its employee, as he was the employee of AIMST University which is separate legal entity from AIMST Sdn Bhd The Claimant's Letter of Appointment to the post of part time Finance Officer was issued by AISMT University, and not AISMT Sdn Bhd The Company was registered under the Companies Act 1965, whereas AIMST University is an institution of higher learning registered under the Private Higher Educational Institutions Act 1996. The Company is run by a Board of Directors, whereas AIMST University is run by a Board of Governors.
[6] It is the Company's stand that the Claimant's service with AISMT University were never terminated but came to end by reason of the Claimant reaching age of sixty (60). The Claimant had reached his retirement age of sixty (60) on 19 September 2016. Thereafter, the Claimant was employed on a contract basis at the discretion of AIMST University, initially for a term of two (2) years vide letter dated 26 April 2016 with effect from 19 September 2016 to 18 September 2018, and thereafter for period of one (1) year from 19 September 2018 to 18 September 2019.
[7] The Claimant was at all times, subjected to AIMST University's compulsory retirement age of sixty (60) as per the University's Staff Handbook, which is applicable to all of University's employees. The Claimant has failed to prove that he had been dismissed by the Company and that his employment had in fact come to a natural end due to his attaining retirement age of 60 years, thus the issue of whether the dismissal was done with or without just cause or excuse does not arise as there was no dismissal to begin with in the first place.
The Claimant's Case:
[8] Based on the term and condition set out in the Claimant's Letter of Employment dated 24 April 2001 was never subjected the Claimant to any retirement age as there is no "retirement age" clause in the contract of employment entered between the Claimant and the Company. The Company had never whether before or after the commencement of the Claimant's employment with the Company made known and/or imposed on the Claimant any retirement age.
[9] At all material times the Company made pre contract promise where the Company had made known to the Claimant that there is no need for a retirement age clause and that the Claimant could work with the Company as long as the C
