Misconduct leading to dismissal does not require criminality; procedural fairness must be upheld in employee dismissal cases.

[1] These appeals arose from two Industrial Court awards (awards) which held that the dismissal of the respondents by TT Electrical Electronics Corporation (M) Sdn Bhd (company) on 21 March 2000 was without just cause or excuse.

[2] The respondents, who were Directors/minority shareholders as well employees of the company, were responsible for the day-to-day management of the company. On 13 March 2000, the company issued the following show cause letters to the respondents:

"Date: 13 March 2000 Puan Nadiah Zee Binti Abdullah

Dear Madam

Re: Employment as Chief Executive Officer

1. You are alleged to have misconducted yourself as follows:

1.1 Opening of Bank Account Without Authorisation

You are reported:

(i) To have without the authority of the Board of Directors and in collaboration with the Executive Officer of the company, Yong Peng Kean, caused to be opened on 25 October 1999 a current account in the name of the company with Perwira Affin Bank at No 2, Jalan Hujung Permatang 2 (26/25B), Section 26, 40000 Shah Alam, Selangor Darul Ehsan bearing No: 0631040000002059 and to be operated jointly by you and Yong Peng Kean ("the Current Account") by using a Board of Directors Resolution In Writing dated 25 October 1999 signed only by you and Yong Peng Kean;

(ii) to have in collaboration with Yong Peng Kean and kept from the companys knowledge, deposited into the Current Account payments made to the Company; and

(iii) to have in collaboration with Yong Peng Kean and kept from the companys knowledge, conducted transactions using the Current Account from 26 October 1999 to 06 March 2000;

1.2 Gross dereliction of duties in failing to keep true and proper records of the Company it is reported:

(i) that you have failed/neglected to ensure that due and proper records of all transactions conducted using the Current Account were promptly and regularly entered into the companys accounting system;

(ii) in view thereof, you had knowingly allowed the companys business to be conducted based on incomplete records;

(iii) that it was when Mr Theu Boon Ooi, the Executive Director, discovered that there may be a current account opened in the name of the company with a bank for which the Board of Directors did not authorize and/or have no knowledge of and for which no record was kept by the company, you had on 8 March 2000 and 9 March 2000 personally caused to be entered into the companys accounting system, all transactions conducted using the Current Account; and

(iv) that after having done (iii) above, you had on the evening of 9 March 2000 forwarded to the companys accountant, Tay Way Ming, a file containing documents purporting to be the transactions that you and Yong Peng Kean conducted using the Current Account.

1.3 Dereliction in duties in failing to promptly deposit payment of cheques made to the Company

It is reported that despite it being known to you that the company was having cash flow problem which was adversely affecting the business of the company, you failed/neglected to cause to be deposited into the companys bank accounts the following cheque payments collected by the company:-

2. You are hereby given an opportunity to submit your explanation in writing WITHIN SEVEN (7) DAYS from the date hereof as to why your contract of service with the company should not be terminated. Please note that should you fail to give any reasonable explanation within the stipulated time, we will assume that you have no explanation to offer and will proceed to consider your services as having been terminated.

3. Since the charges levelled against you are of a grave and serious nature, you are forthwith suspended from your duties as the companys Chief Executive Officer pending the receipt of your written explanation and a decision has been made. During the period of suspension, you are not permitted to enter the companys premis