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2024 MarsdenLR 1205
INDUSTRIAL COURT KUALA LUMPUR
JALALUDIN MOKHTAR – Appellant
Versus
CELCOM NETWORKS SDN BHD – Respondent
Award No: 1648 Of 2024 [Case No: 22/4-1795/19]
An employee's failure to disclose conflicts of interest and engage in deceptive conduct constitutes just cause for dismissal under employment law.
Headnote:(A) Industrial Relations Act 1967 - Section 20(3) - Dismissal of employee - Claimant dismissed for misconduct including fraudulent claims and conflict of interest - Court determined misconduct proven on balance of probabilities - Dismissal found to be with just cause. (Paras 24, 28, 56, 62)
(B) Employment Law - Fiduciary duty - Employee must act in the best interest of the employer and disclose conflicts of interest - Breach of duty can justify dismissal. (Paras 57, 58, 60)
Facts of the case:
The Claimant was dismissed from his position after being found guilty of three charges of misconduct, including submitting fraudulent claims and failing to disclose a conflict of interest arising from his daughter's employment with a vendor.
Findings of Court:
The Court found that the Claimant's actions constituted serious misconduct, justifying the dismissal.
Issues: The main issues were whether the misconduct charges were proven and if they constituted just cause for dismissal.
Ratio Decidendi: The Court ruled that the Claimant's failure to disclose conflicts of interest and his deceptive actions warranted dismissal, affirming the employer's right to terminate employment for serious misconduct.
Result: Claimant's case dismissed.
AWARD
Reference
[1] This is a reference made under s 20(3) of the Industrial Relations Act 1967 (Act 177), arising out of the dismissal of Jalaludin Bin Mokhtar (hereinafter referred to as "the Claimant") by Celcom Networks Sdn Bhd (hereinafter referred to as "the Company") on 6 May 2019.
[2] The Ministerial reference in this case required the Court to hear and determine the Claimant's complaint of dismissal by the Company on 6 May 2019.
I. Procedural History
[3] The Court received the letter pertaining to the Ministerial reference under s 20(3) of the Industrial Relations Act 1967 on 17 September 2019.
[4] The matter was fixed for mention on 8 October 2019, 6 January 2020, 9 December 2020, 20 August 2021, 16 December 2021, 20 April 2022, 27 May 2022, 19 October 2022 and 13 December 2022.
[5] The trial proceeded on 3 January 2023, 16 December 2023, 1 June 2023, 18 July 2023 and concluded on 16 May 2024.
II. The Parties' Position On The Merits
(a) The Claimant
[6] The Claimant was first employed by Telekom Cellular Sdn Bhd on 1 November 1997 as a Senior Manager, Corporate Affairs and Legal Division.
[7] After the merger of Telekom Cellular Sdn Bhd and the Company, the Claimant was then placed at Regulatory, Legal & Corporate Affairs Division of the Company. Later, the Claimant was transferred to Vendor & Partnership Management Division, Group Network as Senior Manager from 1 November 2012.
[8] The Claimant was then promoted as the Head of Network Vendor & Partnership Management from 1 September 2012. The Claimant then was promoted to the role of Head of Vendor Partnership Management from 1 June 2014.
[9] On 31 December 2018, the Company had accepted the Claimant's offer for the Sunrise program, being a voluntary separation scheme ("VSS"). The compensation package offered to the Claimant was RM538,301.92 and other benefits. The Claimant's last date of employment was on 31 March 2019.
[10] In January 2019, there was apparently a whistleblower complaint about the Claimant, alleging that the Claimant had practised favouritism in awarding the In-Building Coverage ("IBC") Project to the Company's vendor, namely Grass2Route Sdn Bhd ("G2R").
[11] In cooperating with the corporate investigation and forensic on 9 January 2019 regarding the complaint, the Claimant had denied the favouritism allegation in the IBC project.
[12] Vide a show cause letter dated 18 February 2019 ("the Show Cause letter") issued by the Company to the Claimant, the Claimant was charged with 3 misconducts, which are as follows:
i. Misconduct 1 - Submission of Fraudulent Claim: The Claimant had deceived the Company into reimbursing the Claimant by submitting a fraudulent ETS tickets claim amounting to RM141.00 even though the ETS tickets were purchased by G2R for the Claimant and the Claimant's subordinate, Mohd Sazali Bin Muhamat @ Sharif which was subsequently approved by the Company and credited into the Claimant's account;
ii. Misconduct 2 - Conflict of Interest: The Claimant had failed to act in the best interest of the Company when he directly awarded 20 sites of IBC projects to G2R without offering the same 20 sites to other active vendors. During investigation on this matter, the Claimant had admitted that the Claimant's daughter was employed by G2R as Engineer, IBC since February 2018. In the light of the Claimant's daughter's employment with G2R, the Claimant had breached the Company's Blue Spirit Policy - Conflict of Interest; and
iii. Misconduct 3 - Abuse of Authority: The Claimant had requested Malik Faizal Bakar, Managing Director of Platinum Core Solutions Sdn Bhd ("Platinum Core") that is also one of the Company's active vendors at the material time to find and/or secure an employment in favour of the Claimant's daughter, preferably in Petronas, which was a breach of the Company's Blue Spirit Policy - Business Conduct (Dealing with External Parties - Dealing with Vendors and Business Partners).
[13] Vide the Claimant's letter dated 1 March
