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2023 MarsdenLR 410
INDUSTRIAL COURT PENANG
FOO JIN KEAT – Appellant
Versus
MSM PRAI BERHAD – Respondent
Award No: 2308 Of 2023 [Case No: 18/4-2996/21]
The court established that constructive dismissal requires proof of a significant breach of contract by the employer, which was not demonstrated in this case.
Headnote:(A) Industrial Relations Act 1967 - Section 20(3) - Constructive dismissal - Claimant alleged constructive dismissal due to removal of responsibilities and communication issues - Company contended no breach of contract and that the claimant abandoned his employment - Court found no evidence of bad faith or fundamental breach of contract. (Paras 1-70)
(B) Constructive Dismissal - The proper test is whether the employer's conduct constitutes a significant breach going to the root of the contract. (Paras 18-20)
(C) Managerial Prerogative - The employer has the right to restructure and assign roles within the organization as per business needs without breaching employee contracts. (Paras 28-30)
(D) Burden of Proof - The claimant bears the burden to prove constructive dismissal, shifting to the employer only if the claimant succeeds. (Paras 21-22)
| Table of Content |
|---|
| 1. claimant's employment status and actions leading to dismissal (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16) |
| 2. legal framework for constructive dismissal (Para 17 , 18 , 19 , 20 , 21 , 22 , 23) |
| 3. evaluation of evidence regarding job responsibilities (Para 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 , 37 , 38 , 39 , 40) |
| 4. analysis of managerial prerogative and employee rights (Para 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54 , 55) |
| 5. claimant's allegations regarding authority and decision-making (Para 56 , 57 , 58 , 59 , 60 , 61 , 62 , 63) |
| 6. conclusion on constructive dismissal claim (Para 64 , 65 , 66 , 67) |
| 7. final ruling on the case (Para 68 , 69) |
The Reference
[1] This is a reference made on 6 December 2021 by the Director General of the Industrial Relations Department to the Industrial Court of Malaysia under s 20(3) of the Industrial Relations Act 1967 (hereinafter referred to as 'the Act') arising out of the dismissal of FOO JIN KEAT (hereinafter referred to as 'the Claimant') by MSM PRAI BERHAD (hereinafter referred to as 'the Company'). The Director General's reference in this case before the Court requires the Court to hear and determine the Claimant's complaint of dismissal by the Company on the 29 March 2021.
Brief Background Facts Of The Case
[2] The Claimant's pleaded case as contained in his Statement of Case dated 25 January 2022, is that his last held position in the Company was as a Senior Sales Manager earning a salary of RM8,550.00 and was based in the Company's main office and factory in Chuping, Perlis, which was known as MSM Perlis Sdn Bhd.
[3] As a result of a restructuring of the group company, MSM Malaysia Holdings Berhad, the Claimant pleads that the Company took over MSM Perlis Sdn Bhd which operates a sugar refinery in Chuping, Perlis. The Company closed MSM Perlis Sdn Bhd and its operations were shifted to their new sugar refinery in Tanjung Langsat, Johor.
[4] Further, the Claimant states that after the restructuring and the closure of MSM Perlis Sdn Bhd, the Company offered the Claimant a continuous employment option through a letter dated 25 February 2021 and the Claimant accepted the offer. In the said letter, the Company assured the Claimant that his employment with the Company will remain the same in terms of his position, salary, location of work and job scope.
[5] The Claimant pleaded and contended that the Company had from 1 March 2021, had not invited him to any of the sales meeting and neither was he kept in the loop of communication involving the sales team and was also notified verbally that the Company's customers are to approach the newly appointed Senior Sales Manager instead of the Claimant.
[6] The Claimant also pleaded that the Company's Sales Executives were also instructed to report to the new Senior Sales Manager instead of the Claimant although they were previously under the supervision of the Claimant. At a meeting on 29 March 2021, between the Claimant and the Company's Head of Commercial, Mr Tengku Haidar and the newly appointed Senior Sales Manager, Mr Sunilinder Singh, the Claimant pleaded that he was informed that all his previous and existing responsibilities have been passed over to Mr Sunilinder Singh and the Claimant was required to handle sales in East Malaysia.
[7] The Claimant pleaded and contended that the Company had removed his job scope without giving him any notice and this action by the Company was done in bad faith to drive him out of employment with the Company.
[8] As a result of the Company's action, the Claimant pleaded that they have breached the terms of his employment contract and evinced an intention to be no longer bound by the terms of the contract. He then pleaded that via letter dated 29 March 2021, he had informed the Company that he had been constructively dismissed by the Company.
[9] The Company on the other hand, in their Statement of Reply
