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2025 MarsdenLR 1453
INDUSTRIAL COURT KUALA LUMPUR
ENGKU AZNITA ENGKU HAMZAH – Appellant
Versus
SME BANK (M) BHD – Respondent
Award No: 152 Of 2025 [Case No: 19/4-1441/21]
Constructive dismissal requires proof of significant contractual breach by the employer which justifies an employee's resignation, and the burden of proof lies with the employer to establish just cause for dismissal.
Headnote:(A) Industrial Relations Act 1967 - Section 20(3) - Constructive dismissal - The Claimant alleged she was constructively dismissed on 10 August 2020 due to actions by the Bank including extending her Performance Improvement Plan - The Bank contended the Claimant abandoned her position without cause. (Paras 1-3, 21, 49)
(B) Burden of proof - Employer bears the burden to establish just cause for dismissal; Claimant must prove conditions of constructive dismissal. (Paras 26, 28, 43)
(C) Law on constructive dismissal - Constructive dismissal requires a breach sufficient to justify resignation; Claimant must leave employment directly due to breach. (Paras 40-41, 50-52)
Facts of the case:
The Claimant, employed since 2003, faced allegations leading to suspension and performance evaluations rated as unsatisfactory, ultimately claiming constructive dismissal due to extending her Performance Improvement Plan and lack of clarity on investigations against her. (Paras 6-22)
Findings of Court:
The Claimant did not prove constructive dismissal; her resignation was voluntary to avoid disciplinary action. (Paras 55)
Issues: Whether the Bank's conduct amounted to constructive dismissal and if the Claimant left employment for valid reasons. (Paras 33-34)
Ratio Decidendi: The court reiterated that dismissal is valid only if employer’s conduct constitutes a breach going to the contract’s root; voluntary resignation occurred without justification for constructive dismissal. (Paras 38, 55)
Result: Claimant's case for constructive dismissal is dismissed.
| Table of Content |
|---|
| 1. establishment of the dispute context and parties. (Para 1 , 2 , 3 , 6) |
| 2. claimant's account of constructive dismissal. (Para 21 , 22 , 23) |
| 3. employer's burden of proof in dismissal cases. (Para 24 , 25 , 26 , 27 , 28 , 29 , 30) |
| 4. legal standard for constructive dismissal. (Para 38 , 39 , 40) |
Reference
[1] This is a reference under s 20(3) of the Industrial Relations Act 1967 [Act 177] by the Ministerial arising out of the dismissal of Engku Aznita Engku Hamzah ("the Claimant") by SME Bank (M) Bhd ("the Company") on 10 August 2020.
A. Introduction
[2] The parties to the instant matter are Engku Aznita Engku Hamzah ("Claimant") and SME Bank (M) Bhd ("Bank"). The Claimant last held the position of Senior Executive, Employee Relations & Engagement in the Bank's Group Human Capital Management Division ("GHCMD") before abandoning her employment with the Bank.
[3] The issue before this Honourable Court is over the alleged constructive dismissal of the Claimant with effect from 10 August 2020. The Bank disputes the Claimant's averment, and it is the former s position that the latter abandoned her services without any basis and without giving any notice as required by her contract of employment. Hence, the matter was referred to this Honourable Court vide the Ministerial Reference.
[4] This matter proceeded for trial on 22 November 2023, 23 November 2023, 25 July 2024. and 29 October 2024
[5] Cause papers in this proceedings:
(a) Statement of Case dated 29 June 2021;
(b) Statement in Reply dated 16 July 2021;
(c) Rejoinder dated 23 July 2021;
(d) Bank's Bundle of Documents Vol 1: "COB-1";
(e) Bank's Bundle of Documents Vol 2: "COB-2";
(f) Bank's Bundle of Documents Vol 3: "COB-3";
(g) Claimant's Bundle of Documents: "CLB-1";
(h) Claimant's Additional Bundle of Documents: "CLB-2";
(i) Claimant's Additional Bundle of Documents (2): "CLB-3";
(j) Witness Statement of the Claimant: "CLWS-1";
(k) Witness Statement of Encik Muhammad Razif Mahaboob "COWS-1";
(l) Affidavit of Non-Service affirmed by Mohamad Shah Rizad Mohamed Tahawin on 17 July 2024;
(m) Affidavit of Non-Service affirmed by Mohamad Shah Rizad Mohamed Tahawin on 19 July 2024; and
(n) Agreed Notes of Proceedings.
B. Facts Leading To The Dispute
[6] The Claimant commenced her employment with the Bank as an Officer in the Human Resources Development Department with effect from 6 January 2003, vide a letter of appointment dated 14 November 2002.
[7] Following a complaint lodged on 31 December 2019 ("Complaint") against the Claimant, one Puan Zahariah Long, Head of Customer Service Management Department and Encik Muhammad Razif Mahaboob ("COW1"), the Bank's Group Audit Division ("GAD") was instructed to conduct a preliminary investigation on the same ("Investigation").
[8] Thus, vide a memo dated 12 February 2020, the GAD had recommended to the GHCMD to suspend the Claimant, Puan Zahariah Long and COW1 for two weeks with full pay in order to facilitate an investigation into the Complaint. Accordingly, vide letter dated 12 February 2020, the Claimant was suspended with immediate effect for two weeks pending the Investigation.
[9] Subsequently, vide a Memo dated 26 February 2020, the GAD recommended for the suspension of the Claimant and COW-1 to be lifted following the completion of the interview process in the ongoing Investigation.
[10] Vide letter dated 27 February 2020, the Claimant was informed by the Bank that her suspension had been lifted. The Claimant was also informed that the Investigation into the Complaint was still ongoing, and she would be issued a temporary desktop or laptop and a temporary new work email and user ID.
[11] In the midst of the said Investigation, vide letter dated 19 March 2020, the Claimant was notified by the Bank of her final calibrated performance rating of "2 or unsatisfactory performance" for the year 2019 and that she would be placed on a Performance Improvement Plan ("PIP") for three months from 1 April 2020.
[12] The Claimant was als
