Back
2025 MarsdenLR 4828
INDUSTRIAL COURT KUALA LUMPUR
LOW KOK LEONG – Appellant
Versus
A V-ECOPALMS SDN BHD – Respondent
Award No: 169 of 2025 [Case No: 14/4-788/23]
The employer must provide just cause for termination; failure to do so results in unlawful dismissal under the Industrial Relations Act 1967.
Headnote:(A) Industrial Relations Act 1967 - Section 20(3) - Dismissal of employee - Claimant employed as Senior Mill Finance Administrator, terminated without just cause or excuse - Company failed to establish employer-employee relationship, asserting it was merely a shareholder - Court found sufficient evidence of employer status based on salary payments and contract renewals - Claimant entitled to backwages and payment for unutilized annual leave. (Paras 1, 56, 68)
(B) Employment Contract - The absence of the Company's name in the Employment Contract does not negate the employer-employee relationship established through conduct and payment of salary - The Company’s failure to provide just cause for termination renders it unlawful. (Paras 23, 56)
(C) Burden of Proof - The employer must prove just cause for dismissal; failure to do so results in unlawful termination. (Paras 50, 58)
Facts of the case:
The Claimant was employed by the Company and later terminated without notice or valid reason. The Company claimed it was not the employer, but the Court found otherwise based on evidence of salary payments and contract renewals.
Findings of Court:
The Company failed to prove just cause for termination; the Claimant is entitled to backwages and payment for unutilized annual leave.
Issues: Whether the Company was the Claimant's employer and whether the termination was with just cause.
Ratio Decidendi: The Court ruled that the Company was the Claimant's employer based on the evidence of salary payments and contract renewals, and that the termination was unlawful due to lack of just cause.
Result: The Company is ordered to pay RM108,416.00 to the Claimant.
AWARD
Reference
[1] This is a reference under s 20(3) of the Industrial Relations Act 1967 (the Act) by the Director General of Industrial Relations, emanating from the dismissal of Low Kok Leong ("the Claimant") by A V-Ecopalms Sdn Bhd ("the Company") on 15 July 2022.
Preamble
[2] This Court had considered the notes of proceedings and the following pleadings, evidence, documents and submissions in handing down this Award:
(i) Statement of Case dated 18 May 2023;
(ii) Statement In Reply dated 30 May 2023;
(iii) Rejoinder dated 7 June 2023;
(iv) Company's Bundle of Documents: COB-1;
(v) Company's Supplementary Bundle of Documents: COB-2;
(vi) Claimant's Bundle of Documents: CLB-1;
(vii) Claimant's Additional Bundle of Documents: CLB-2;
(viii) Claimant's Additional Bundle of Documents (2): CLB-3;
(ix) Witness Statement of Tan Hock Yew: COWS-1;
(x) Witness Statement of the Claimant, Low Kok Leong: CLWS-1;
(xi) The Company's Written Submission dated 7 October 2024;
(xii) The Claimant's Written Submission dated 7 October 2024;
(xiii) The Company's Written Submission In Reply dated 30 October 2024; and
(xiv) The Claimant's Written Submission In Reply dated 31 October 2024.
The Claimant's Case
[3] On 6 January 2019, the Claimant was employed by the Company as a Senior Mill Finance Administrator at Manuhing Palm Oil Mill, Kalimantan Tengah, Indonesia from 6 January 2019 to 5 January 2021 with a monthly salary of RM16,000.00.
[4] On 9 January 2021, the Company renewed the Employment Contract with the Claimant on the following terms:
(a) The term of employment is renewed for another two (2) years from 7 January 2021 to 6 January 2023; and
(b) The salary of the Claimant would be RM17,600.00
[5] On 13 May 2022, the Claimant was promoted as the General Manager by the Company.
[6] On 15 July 2022, without any prior written notice or otherwise, the Company informed the Claimant that his employment was terminated from July 2022 onwards.
[7] At all material times, the Company had failed, refused and/or neglected to give any valid reasons, cause or excuse to the Claimant with respect to the termination.
[8] The Claimant averred that the Company had wrongfully terminated the Claimant's employment in which the particulars are as follows:
(a) The Company had failed to give any prior warning to the Claimant before the termination;
(b) The Company had failed to issue any letter to show cause against the Claimant before the termination;
(c) The Company had failed to carry out any domestic inquiry;
(d) The Company had failed to give any just cause or excuse to the Claimant with regard to the termination; and
(e) The Company had not terminated the Claimant's employment in accordance with the employment contract particularly cls 41 and 42.
[9] The Claimant has been terminated without just cause and excuse.
The Company's Case
[10] The Claimant has wrongfully filed this claim against the Company as the Company was never at any material time the employer of the Claimant.
[11] The fact is that at all material times, the Claimant's employer was PT Berkala Maju Bersama (PT Berkala Maju) which is a foreign company incorporated in Indonesia.
[12] The Company is merely a shareholder in PT Berkala Maju.
[13] The Company avers that:
(a) The Company is not a party to the Employment Contract;
(b) The Employment Contract refers to the Claimant as the Expatriate Employee (EE);
(c) The Claimant and PT Berkala Maju had signed a Second Employment Contract (Second Contract); and
(d) Employment Contract was signed by the Claimant as employee and COW-1 for the employer in his capacity as "Direktur Utama".
[14] The Claimant was employed as Senior Mill Finance Administrator and stationed to work at PT Berkala Maju, Manuhing Palm Oil Mill, Kalimantan Tengah, Indonesia.
[15] The Company could never have been the Claimant's employer because the Company is merely an Investment Holding Company holding shares in PT Berkala Maju and does not own the mill in Indonesia.
[16] No provision for the respective statu
