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2010 MarsdenLR 1895
INDUSTRIAL COURT, KUALA LUMPUR
TAN SENG WONG – Appellant
Versus
LUDWIG AIR HEALTH SDN BHD – Respondent
Award No. 1539 Of 2010 [Case No: 19/4-1904/06]
The determination of an individual's employment status as a workman under the Industrial Relations Act hinges on the nature of their appointment, clarifying the distinction between a contract of service and a contract for services.
Headnote:(A) Industrial Relations Act 1967 - Section 2 - Definition of workman - Test for determining whether an individual is a workman hinges on the nature of the appointment, specifically whether under a contract of service or for services. (Paras 19-20)
(B) Claimant's status - Claimant failed to demonstrate employment as a workman; operated as a Managing Agent without written contract, primarily receiving sales commissions. (Paras 24-38)
Facts of the case:
The claimant brokered the sale of a business and was appointed Managing Agent after the company's takeover. However, the claimant managed operations resulting in losses and failed to submit requested financial documents.
Issues: Whether the claimant qualifies as a workman under the Act.
Findings of Court:
Evidence demonstrated that the claimant acted as Managing Agent, not as a workman, lacking an employment contract.
Ratio Decidendi: The court concluded that the claimant, lacking substantial evidence and clarity on his role, was not covered under the definition of a workman.
Result: Claim dismissed.
| Table of Content |
|---|
| 1. claimant's role and engagement with the company. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17) |
| 2. legal classification of the claimant. (Para 18 , 24 , 25) |
| 3. criteria for determining employment status. (Para 19 , 20 , 21 , 22 , 23) |
| 4. evidence pertaining to claimant's employment status. (Para 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 , 37) |
| 5. inconsistencies in claimant's assertions. (Para 38 , 39 , 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49) |
| 6. claimant's actions undermining employment claim. (Para 50 , 51 , 52 , 53 , 54 , 55 , 56 , 57) |
| 7. failure to show evidence of employment. (Para 58) |
[1] The company took over the business from another owner after a proposal came through the claimant who was instrumental in establishing the business and their main area of business was distribution of air purifier.
[2] The claimant was actively involved in brokering the sales and purchase of the business before the company took over the business from the previous owner. The taking over exercise of the business includes taking over of the existing agents and the business in the region.
[3] Since the claimant was already involved in the business, the claimant approached the company on the business strategies and suggested that he be given the title of General Manager to facilitate business dealings. Having considered the business prospect the company agreed on the claimant's suggestion.
[4] The claimant oversees the Kuala Lumpur office and the operational cost of that office was borne by the company.
[5] The purpose of the claimant's engagement as Managing Agent was primarily to manage the operation of the business and make profit for the company for which the claimant was rewarded handsomely. The terms of his service as the Managing Agent was made orally considering the trust and representation made by the claimant prior to the company taking over the business from the previous owner.
[6] The agreement on the operation of the business was orally entered into with the claimant and the dealers considering the initial stage of taking over the business from the previous owner.
[7] To facilitate the operation of the business the company made available basic facilities such as regional office and office equipment and paid the rental of the businesses in Kuala Lumpur (please see p. 96-100 of COB1) together with supporting agents appointed to support the business (please see pp. 28-86 of COB1) and the claimant had direct control over them and their performance.
[8] The claimant was paid sales commissions after taking into consideration sales performance by him, the agents and the dealers (please see pp. 87-95 of COB1).
[9] The company suffered losses on the business managed by the claimant regionally and on various occasion had reprimanded the claimant and issued him various reminders verbally that the business must be improved but the claimant failed to do so.
[10] The above was done when no results were forthcoming under his management of the business and after taking into consideration the representation made by the claimant that the business is doing well and prospects are growing.
[11] The claimant had never shown the financial statements and business records performed by the business to the company and/or its representative and further the movements of the merchandise stocks were also never submitted properly after which the company had demanded that the claimant hand over the accounts and stock inventory list to the company.
[12] In attempting to get the claimant's cooperation in handing over the above the company's Directors approached the claimant and asked him to do so.
[13] Due to the claimant's failure to hand over the documents requested, on 19 September 2005 the company's representative together with their solicitors approached the claimant to hand over the account statement and the stock list.
[14] Despite repeated reminder and request to do so the claimant refused and failed to do so whi
