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2025 MarsdenLR 5055
HIGH COURT MALAYA KUALA LUMPUR
PROTASCO BERHAD & ORS – Appellant
Versus
MOHD NORLI MD SALLEH – Respondent
[Civil Appeal No: WA-16A-60-09-2023]
The Appeal Court found no wrongful dismissal occurred, ruling that the Respondent was solely an employee of KPS-HCM, not the Appellants, thereby rejecting claims for reemployment or damages.
Headnote:(A) Industrial Relations Act 1967 - Section 20(3) - Wrongful termination of employment - Claim of dismissal without just cause or excuse by the Respondent against multiple Appellants - The Industrial Court found the dismissal wrongful, leading to an award of RM645,392 but was appealed - The Appellants contended the Respondent was employed only by KPS-HCM at the time of dismissal, not them. Court considered the intertwined relationship of the companies and whether they constituted a single employer entity. (Paras 1-4, 33, 44, 49, 50)
(B) Employment Law - Determination of employee status - The Respondent claimed he remained an employee of the Appellants despite his termination from KPS-HCM; however, the Court found the Appellants were not his employers. (Paras 12-13, 25-29)
(C) Corporate Veil - Lifting of the corporate veil - Court rejected the Industrial Court’s decision to lift the corporate veil, ruling that KPS-HCM was an independent employer. (Paras 29-32)
(D) Legitimate Expectation - Dismissal’s implications - The expectation of re-employment with the Appellants was deemed unfounded. The Respondent failed to prove such expectation was based on a clear promise by the Appellants. (Paras 34-42) (E) Findings of the Appellate Court: The Court concluded the Respondent’s employment had been solely with KPS-HCM, dismissing the connection to the Appellants, overturning the initial findings of the IC.
Result: Appeal allowed.
| Table of Content |
|---|
| 1. claim of wrongful termination of employment. (Para 1 , 2 , 4 , 6) |
| 2. parties present conflicting accounts of employment. (Para 12 , 13 , 14) |
| 3. court analyzes employment relationship complexities. (Para 17 , 19 , 20 , 29) |
| 4. issues of legitimate expectation in employment. (Para 34 , 39 , 43) |
| 5. appellant's appeal allowed based on court observations. (Para 48) |
Introduction
[1] The substantive matter was brought to the Industrial Court (IC) by way of a reference dated 21 March 2022 by the Director General of the Department of Industrial Relations (DGIR) under s 20(3) of the Industrial Relations Act 1967 ( IRA ) for a claim for wrongful termination of employment.
[2] The dispute before the IC is the claim by Mohd Norli Md Salleh (the Respondent) that he was dismissed from his employment without just cause or excuse by Protasco Berhad, the 1st Appellant (Protasco), Roadcare (M) Sdn Bhd, the 2nd Appellant (Roadcare), HCM Engineering Sdn Bhd, the 3rd Appellant (HCM Engineering) and KPS-HCM Sdn Bhd (KPS-HCM) on 1 September 2021.
[3] Upon the application by the Respondent at the IC and pursuant to an Interim Award No: 1942/2022 dated 29 August 2022, the Respondent's case against Protasco, Roadcare, HCM Engineering and KPS-HCM was consolidated and these cases were heard together thereupon.
[4] This is an appeal (Encl 15) by Protasco, Roadcare and HCM Engineering (the Appellants) against Award No 1873 of 2023 dated 5 September 2023 of the Learned Chairman of the IC that found the dismissal of the Respondent by the Appellants as being without just cause and excuse and ordered that the Appellants jointly and/or severally pay the Respondent a sum of RM645,392.00 less statutory deduction (if any) within 30 days from the date of the Award.
[5] After the hearing, I allowed the Appellants' appeal (Encl 15). I will now set out the grounds for my decision.
The Background Facts
[6] The narration of the background facts of the case can be found in the Learned Chairman of the IC Award and reproduced below with suitable modifications.
[7] The dispute before the IC is the claim by Mohd Norli bin Md Saleh (Respondent) that he was dismissed from his employment without just cause or excuse by Roadcare, Protasco, KPS-HCM and HCM Engineering on 1 September 2021.
[8] Protasco is an entity that is involved in a variety of businesses in this country. Under Protasco, there were subsidiaries established to primarily operate road maintenance and related businesses. Amongst the subsidiaries that are relevant to the dispute herein are Roadcare, KPS-HCM and HCM Engineering.
[9] The Respondent was employed by Roadcare and commenced employment on 1 March 2001 as the Area Manager based in Kuantan. The Respondent was subsequently confirmed in the same employment. Amongst the terms of the Respondent's contract of employment with Roadcare, the Respondent was subject to transfer within the Protasco group of companies. On 6 June 2008 through Protasco, Roadcare issued the Respondent a transfer order to HCM Engineering which entailed the promotion of the Respondent to the position of General Manager of a project known as SSRM Project. The Respondent agreed and accepted the transfer.
[10] On 19 December 2007, an entity known as Kumpulan Perangsang Selangor Berhad (KPS) entered into a joint venture agreement (JVA) with HCM Engineering and by virtue of this JVA, KPS-HCM was incorporated and the shares in this entity were jointly held by KPS and HCM Engineering on a 30/70 percentage shareholding wherein the substantial shareholding in KPS-HCM was held by HCM Engineering, a subsidiary of Protasco. By a management agreement between HCM Engineering and KPS-HCM, HCM Engineering was to provide management services to KPS-HCM. HCM Engineering then transferred the Respondent to KPS-HCM to work on the projects given to KPS-HCM namely the SSRM project in early 2009, previously under HCM Engineering. Despite the 'transfer' from HCM Engineering to KPS-HCM, the Re
