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2025 MarsdenLR 6268
INDUSTRIAL COURT KUALA LUMPUR
SYAFIQ HAMDI SHUSHILIL AZAM – Appellant
Versus
MALINDO AIRWAYS SDN BHD – Respondent
Award No: 646 of 2025 [Case No: 15(6)/4-1940/21]
Retrenchment must be grounded in genuine redundancy, with the employer bearing the burden of proof for just cause, adhering to established industrial law principles including the LIFO selection methodology.
Headnote:(A) Industrial Relations Act 1967 - Section 20(3) - Dismissal and retrenchment due to redundancy - Claimant dismissed by employer citing COVID-19 impact as reason for redundancy - Court established that redundancy requires genuine circumstances and good faith in execution - Burden of proof on employer to demonstrate redundancy - Evidence supported claim of genuine redundancy due to COVID-19 - Court affirmed the application of LIFO principle in retrenchment decisions. (Paras 22-29, 32-33, 45, 117)
(B) Just cause for dismissal - Burden lies with employer to show fairness of retrenchment - Evidence demonstrated adherence to proper procedures and principles in executing the retrenchment exercise - No evidence of mala fide conduct found. (Paras 20, 117)
Facts of the case:
The Claimant, employed as a Co-Pilot, was retrenched by the Company under the claim of redundancy due to financial hardships stemming from the COVID-19 pandemic - Evidence showed significant reduction in flights and operations. (Paras 1-17)
Findings of Court:
The retrenchment was justified based on the principles of industrial law, demonstrating genuine redundancy due to economic factors arising from the pandemic and was executed fairly without bad faith. (Paras 117)
Issues: Whether the retrenchment was genuinely warranted, if it was executed in good faith, and whether the principles of LIFO were applied correctly. (Paras 30-40, 102)
Ratio Decidendi: The court ruled that the employer must prove actual redundancy for just dismissal and established that business needs justified the retrenchment - The decision was made on the basis of a bona fide organizational restructure due to significant reductions in operations and was determined to be lawful. (Paras 28, 117)
Result: Claimant's dismissal upheld as lawful.
| Table of Content |
|---|
| 1. this case is a reference regarding dismissal. (Para 1 , 2 , 4 , 5) |
| 2. background on the claimant's employment history. (Para 9 , 10 , 11) |
| 3. the impact of covid-19 leading to retentions. (Para 12 , 13 , 14 , 16) |
| 4. claims regarding the fairness of the retrenchment process. (Para 19 , 20 , 21) |
| 5. definition and nature of retrenchment under the law. (Para 22 , 24 , 25 , 26 , 27) |
| 6. employer's burden of proof in retrenchment situations. (Para 30 , 31) |
| 7. redundancy can arise from surplus manpower. (Para 32 , 35 , 40 , 41 , 46 , 50) |
| 8. financial conditions justifying retrenchment. (Para 56 , 60) |
| 9. application of lifo in retrenchment process. (Para 91 , 95 , 100) |
| 10. conclusion supporting lawful retrenchment of the claimant. (Para 116 , 117) |
A. Reference
[1] This is a reference from The Honourable Minister of Human Resources, Malaysia to the Industrial Court of Malaysia under s 20(3) of the Industrial Relations Act 1967 ("the IRA ") in respect of the dismissal of Syafiq Hamdi Bin Shushilil Azam ("the Claimant") by his employer, Malindo Airways Sdn Bhd ("the Company") on 1 November 2020.
B. Background
[2] The case was initially tried by the learned Chairman, Yang Arif Tuan Iznan Bin Ishak, who had since retired from the Malaysian Public Services on 9 May 2023, and ceased to be the Chairman of the Industrial Court of Malaysia. Thereafter, I have taken over the conduct of this matter as the new Chairman of this Court and continued with the trial of this matter until its conclusion.
[3] I rely on the authority of Bax Global (Malaysia) Sdn Bhd v. Sukhdev Singh Pritam Singh & Anor [2010] 3 MELR 56; [2010] 9 MLRH 421; [2010] 2 CLJ 534; [2011] 2 CLJ 534, where the Court held that s 23(6) of Industrial Relations Act 1967 (" IRA ") allows another Chairman to continue hearing a part-heard case and the new Chairman can hand down award in such cases.
[4] Therefore, this award is written based on my reading, perusal, and evaluation of the facts and evidence contained in the notes of proceedings prepared by the learned former Chairman, Yang Arif Tuan Iznan Bin Ishak, and gleaned from the documents made available to me and the evidence adduced before me after I took over the conduct of this matter.
C. The Proceedings
[5] The Claimant in the present case was dismissed by the Company by way of retrenchment. The Company cited the COVID-19 pandemic, which resulted in financial hardship, as the reason for the Claimant's position becoming redundant, which ultimately led to his retrenchment.
[6] The Company commenced the case by calling the following persons as witnesses to give evidence in support of the Company's case against the Claimant:
(a) Andriaty Binti Abdul Rahman ("COW1"), who was the Company's Head of Corporate Finance/Business Planning & Analysis/Project Management Office;
(b) Visvaratnam a/l Sabaratnam ("COW2"), who was the Company's General Manager for Customer Care (overseeing HR and legal departments); and
(c) Muzaffar Bin Mazlan ("COW3"), who was the Company's General Manager of Human Resources at the material time. He had since left the Company at the time of the trial.
[7] Upon conclusion of the Company's case, the Claimant commenced his case against the Company. The Claimant did not call any other witnesses to give evidence at the trial. Only the Claimant gave evidence at the trial in support of his case against the Company.
[8] The following cause papers and documents have been filed and/or marked as evidence before the Court and were referred to during the proceedings:
(a) The Claimant's Statement of Case dated 21 October 2021 ("the Statement of Case");
(b) The Company's Statement in Reply dated 23 November 2021 ("the Statement in Reply");
(c) The Claimant's Rejoinder dated 31 January 2022 ("the Rejoinder");
(d) The Company's Supplementary Bundle ("COB1B");
(e) The Company's Supplementary Bundle of Documents 2 ("COB2B");
(f) The Company's Supplementary Bundle of Documents 3 ("COB3B");
(g) The Company's Supplementary Bu
