The court established that allegations of misconduct must meet legal thresholds of just cause under the Industrial Relations Act, emphasizing the principle of proportionality.

[1] The appellant (employee) appeals against the decision of the learned High Court Judge who refused to quash the award of the Industrial Court which dismissed the appellant's application against the dismissal by the 2^nd respondent (employer) based on just cause or excuse relating to allegations of misconduct. We heard the appeal on 13 November 2014 and upon hearing the submission, we allowed the appeal. My learned brothers Mohd Hishamudin Yunus JCA and Linton Albert JCA have read the judgment and agreed the same. This is our judgment.

Misconduct And Industrial Jurisprudence

[2] It must be strictly observed that industrial law jurisprudence does not permit all forms of unsatisfactory conduct or poor performance or negligence to be labeled as misconduct. There are a number of case laws here as well as in other recognised jurisdictions that explain what act or conduct amount to misconduct or will not satisfy the threshold.

[3] An industrial tribunal properly appraised of the facts must not succumb to any allegation of misconduct, if the acts complained of do not qualify as misconduct, or if the circumstances leading to allegation of misconduct do not warrant dismissal on the ground of just cause or excuse, taking into consideration the proportionality principle advocated in the case laws.

[4] Industrial law jurisprudence does not permit any form of oppressive conduct on the part of an employer having the objective of dismissing the employee on "just cause or excuse" based on trivial allegations; based on matters that could have been dealt with appropriately with proper operating system or management system instead of taking drastic steps to dismiss the employee. The Industrial Court in the Malaysian context is obliged to do a balancing exercise taking into account such factors as the nature of the complaint the conduct of the employer, the operating and management system that is in place, the reason advanced by the employee as well as his conduct, and the gravity of the allegation; in order to ascertain whether the employee's act or omission qualifies as a misconduct to attract s 20 of Industrial Relations Act 1967 ( IRA 1967). The proposition is fortified by s 30 of 1967.

[5] It is now well established that in exercising the jurisdiction and power under s 20 of the IRA 1967, the duty of the Industrial Court is two-fold, namely:

(i) Firstly, to determine whether the misconduct complained of by the employer has been established; and

(ii) Secondly, whether the proven misconduct constitutes just cause or excuse for the dismissal.

[Emphasis Added]

Failure to determine these issues on the merits would be a jurisdictional error which merits intervention by the High Court. [See Milan Auto Sdn Bhd v. Wong Seh Yen , [1995] 3 MLJ 537].

[6] The starting point and the key to decide whether the situation attracts s 20 is for the Industrial Court to determine whether the complaint qualifies as misconduct, taking into consideration all the circumstances and facts.

[7] The term 'misconduct' is not defined in IRA 1967. The Law Lexicon by P Ramantha Aiyar (Reprint 1992) defines misconduct inter alia as follows:

"The term 'misconduct' implies as wrongful intention and not a mere error of judgment. Misconduct is not necessarily the same thing as conduct involving moral turpitude."

[8] In India there are some statutory guidelines as to what acts and omissions will be treated as misconduct. The learned author OP Malhotra, The Law of Industrial Disputes in 5^th edn at pp 891 and 892 says:

"Under the Industrial employment (Standing Orders) Central Rules 1946 framed under the Industrial Employment (Standing Orders) Act 1946, the Central Government has prescribed the Model Standing Orders in Schedule I,