HADZRI BIN ABDUL HAMID MENG LIGHT ENGINEERING SDN BHD

DALAM MAHKAMAH TINGGI MALAYA DI GEORGETOWN NOMBOR GUAMAN: PA-16-9-08/2023 ANTARA HADZRI BIN ABDUL HAMID ...Perayu DAN MENG LIGHT ENGINEERING SDN BHD ...Responden GROUNDS OF JUDGMENT Introduction [1] This is an appeal against the decision of this Court on 18.01.2024 which affirmed and upheld the decision of the Industrial Court against the Respondent (Company) who had dismissed the Appellant's claim for the termination of the contract on the grounds of constructive dismissal. [2] For the convenience and accuracy of the facts as presented by the parties in the High Court, in this judgment, the parties are referred to as they were in the High Court. Backgrounds [3] The Appellant is a General Manager who serves with Respondent since 1.04.2019 with a monthly salary of RM6,300.00. The Appellant is a permanent employee. At the beginning of May 2021, the Appellant applied to work from home, because at that time there was a period of control movement due to Covid-19. The Appellant has worked from home from 8.05.2021 until 16. 0.8.2021 and was paid until June 2021. [4] On 246.2021, the Respondent sent an e-mail confirming permission for the Company to operate throughout the restriction period to the Appellant. The Appellant was instructed to attend and work in the office. On 29.06.2021, once again an e-mail was sent to the Appellant to attend and work in the office. [5] Due to the Appellant's failure to attend the office, the employer's representative attended the Appellant's home on 2.07.2023. Once again, on 15.07.2021, the Respondent's representative came to the Appellant's house to request the Appellant to sign a Settlement Agreement where if the Appellant signed this Settlement Agreement, the Appellant's services will be terminated and the Appellant will be paid compensation of RM18,900.00 which is equivalent to 3 months of his salary. But this matter was not agreed by the Appellant. [6] Then, after a week of August 2021 has passed, the Appellant has not received his salary for the month of July 2021. Therefore, on 9.08.2021, the Appellant sent an e-mail to the Respondent and informed the Respondent that he has not received his salary for the month of July 2021 and requesting that his salary to be paid by the Respondent before 15.08.2021. No answer was given by the Respondent. [7] Therefore, the Appellant sent a “notice of constructive dismissal’ via e-mail to the Respondent and to be effective on 16.08.2021, on the reason that the Appellant had already been terminated constructively when the Respondent failed to make salary payment for the month of July 2021 to him, even though the Respondent had been notified by the Appellant. Issue [8] In the Notice of hearing before the Industrial Court, the main complain stated is that the Respondent has failed to pay salary in July 2021, and the Appellant acts to use the principle of constructive dismissal for that failure which is alleged to have occurred as a fundamental breach of contract. The issue that was asked and needs to be answered by the Industrial Court is as follows: “Whether the late payment of the salary in July 2021 did amount to breach of the fundamental terms of the contract.” Appellant’s arguments [9] The Appellant argued that there were errors and misdirection of facts and laws required the intervention of this Court. The Appellant 3 argued that the Learned Chairman has indeed made a mistake [Award No. 1742] when she failed completely to taking into account that the “elements of constructive dismissal” has been proven by the Appellant in this case. In her award, the Learned Chairman has already touched on the principles of laws for constructive dismissal but reached into incorrect and unreasonable conclusions. Hence, the decision made by the Learned Chairman is not safe and this requires intervention from this Court. [10] The Appellant refers to the case of NG TECK FAY V. MALAYSIAN COMPANY COURT & ANOR [2021] 10 CLJ 73 where Lee Heng Cheong JCA when delivering the decision of the Court of Appeal has stated that: "The very fact that the reason proffered by the appellant in his letter of constructive dismissal was not properly considered constitutes an error of law that attracts appellate intervention in the form of judicial review.” [11] The Appellant argued that the conclusion reached by the Learned Chairman which alleged that the Appellant had breached the contract for not being present at work since 8.05.2021 is a conclusion that was not supported by any available and factual evidence which contradicts the principle of constructive dismissal law. [12] The Appellant argued that the Learned Chairman decided that the Appellant had breached the service contract since 8.05.2021 but at the same time, she considered the Appellant's last day of work was on 16.08.2021, the day on which the Appellant sent a constructive dismissal notice. In addition, the Learned Chairman also does not and/or fails to consider that during that period (where the Appellant worked from home), 4 the Appellant was paid for the months of May and June 2021 without any problem by the Respondent. {13] Therefore, it shows that the Respondent impliedly had permitted and had no objection for the Appellant to continue working from home since 8.05.2021. The Appellant argued, the Respondent's claim that the Appellant did not get permission to work from home and fail to prepare a report is only an “afterthought “because: (a) Throughout the period from May to July 2021 when the Appellant was working from home, the Respondent never requested a work report from the Appellant. (b) The Appellant's salary was paid as usual for the months of May and June 2021 without requirement for the Appellant to submit a work report. (c) If it is true that the Appellant does not have permission to work from home, it is certain that the Respondent will take disciplinary action against the Appellant however, this was not done by the Respondent. (d) Allegation that there is no permission to work from home and the need to submit a work report only made by the Respondent after a reminder was given by the Appellant on 9.8.202 through an e-mail. [14] In addition, the conclusion made by the Learned Chairman that allegedly, the Appellant who has breached the contract, when failing to get permission to work from home since 8.05.2021, where in fact, the Director of the Company himself, Thi Chow Hock (COW-3) who had admitted during cross-examination that the Respondent did not have any problems 5 for the Appellant to work from home starting from May 2021. This issue should not arise because the Respondent himself has no problem with the action. Otherwise the Respondent should has acted against the Appellant and/or stopped paying the Appellant's salary since May 2021. In fact, the Appellant was ready to work and receive instructions from the Respondent. In addition, the Appellant has also informed the Managing Director of this matter and even informed the Respondent [through COW?2- Ho Thog Boon] that the Appellant was willing to come to the office, if needed and the report of the work is not one of the conditions stated in the contract. [15] Therefore, the principle of forgiveness (condonation) is applicable in the situation and the Chairman has erred from this point of view as stared in TAN POH THIAM V. INDUSTRIAL COURT OF MALAYSIA & ANOR [2015] 1 LNS 1534, Hamid Sultan Abu Backer JCA in delivering the decision of the Court of Appeal, has explains the principle of ‘condonation’ as follows: [14] It must also be noted that industrial law jurisprudence, under the doctrine of condonation, does not permit the employer to rely on stale and sterile charges based on past facts. The principle of condonation was lucidly explained by the Federal Court in PUBLIC SERVICES COMMISSION MALAYSIA V. VICKNESWARY RM SANTHIVELU [2008] 1 LNS 464; [2008] 6 MLJ 1, where Tun Zaki Tun Azmi PCA (as he then was) held as follows at p. 16 of the report: "[39]... Condonation in the context of employment contract is an act by the employer to excuse or forgive him for the wrongful act committed by the employees. Condonation can be in the active form ie, by the act of telling the person that he has act of not taking any action. Halbury's Law of England (4th Ed) Vol 16 at p. 439 para 648 describes condonation as follows: An employer who with full knowledge of his employee's misconduct elects to continue with him in service cannot subsequently dismiss him for the offense which he has condoned." [16] The Appellant submits that based on the case of TAN POH THIAM (Supra), it clearly shows that the Chairman have gone astray when she was not taking into account all elements of constructive dismissal which have been fulfilled by the Appellant, even though the Respondent has not taken any action on the matter, yet she assumed a contract of service has been violated by the Appellant since 8.5.2021 Respondent’s Counter-Arguments [17] Basically, the Respondent’s counter-argument in response to the Appellant's arguments is that the Appellant himself, has breached the contract by not being present at the office since 8.05.2021 because the last time the Appellant signed the attendance book was on 7.05.2021. The Learned Chairman was right when she concluded that there is no major breach of contractual terms by the Respondent and the delay in payment of salary is not a breach of terms that invalidates the contract. [18] The Respondent argues that the Appellant failed to submit evidence (the report) that the Appellant has been doing work while working from home since 8.05.2021 and no permission was given to the Appellant to continue doing his work from home. The Appellant failed to submit a work 7 report and the Appellant's action to work from home since 8.5.2021 was made without the consent/ permission of the Respondent as an employer and therefore, the Appellant has breached the contract of service in advance. Findings and Analysis [19] This is an appeal against a judgment of the Industrial Court. When dealing with a reference under section 20 of the Industrial Relations Act 1967, the main function of the Industrial Court is to determine whether the misconduct or irregularity complained of by the employer is the basis or reason for the employer's complaint for dismissal, the employee actually did or was done by the employee and, if so, whether that reason or reason, just cause or excuse for terminating the employee (see PATCO MALAYSIA BERHAD V MUHAIYAD! BIN HORMEN & ANOR [2017] MLJU 311) [20] This court will only look at the reasons that led to the dispute between the Appellant and the Respondent that have been brought before the Industrial Court based on the notice. In BAYER (M) SDN BHD V ANWAR BIN ABD RAHIM [1996] 2 CLJ 49, the court held that: “Thus, it is settled law that test applicable in or constructive dismissal case is the 'the contract test' and not 'the test of reasonableness’. To claim constructive dismissal, four conditions must be fulfilled. These conditions are: (a)the must be a breach of contract by the employer; (b)the breach must be sufficiently important to justify the employee resigning; (c)the employee must leave in respond to the breach and not for any other unconnected reason; and (d)must no occasion any undue delay in terminating the contract, otherwise he will be deemed to have waived the breach and agreed to vary the contract.” [21] Ifthe employee leaves in circumstances where these conditions are not met, he will be held to have resigned and there will be no dismissal within the meaning of the Act. This Court must examine the said e-mails and the reasons given therein for the Appellant to walk away from his job claiming constructive dismissal (see BAYER (M) SDN BHD (SUPRA). In PATO MALAYSIA BERHAD (SUPRA), held that: “Since it is the function of the Industrial Court, and not the High Court, to weigh and assess the evidence of the witnesses, the High Court cannot interfere with the Industrial Court’s findings of facts and credibility of witnesses unless the same are totally unsupported by evidence, or the same are diametrically contrary to the evidence on record, viz. on the ground of perversity in its findings and the High Court also cannot interfere merely because it may arrive at a different factual conclusion based on the same evidence” [22] The Learned Chairman has stated In Award No. 1742 of 2023 as follows: “[26] Having considered the Claimant's sole complaint, this Court is satisfied and finds that there was no breach of an essential term of the Claimant's contract of service let alone a fundamental breach by the Company. A fundamental breach must go to the foundation of the Claimant's contract of 9 service. In this regard, reference is made to the decision of the Supreme Court in the case of WONG CHEE HONG V. CATHAY ORGANIZATION (M) SDN BHD [1998] 1 MLJ 92 wherein His Lordship Salleh Abas, LP opined — “The common law has always recognized the right of an employee to terminate his contract of service and therefore to consider himself as discharged from further obligations if the employee is guilty of such breach as affects the foundation of the contract or if the employer as evinced or showed an intention not to be bound by it any longer...(Emphasis is this Court's) [27] Rather, this Court finds that it was the Claimant who had repudiated him contract of service with the Company when he last signed this attendance log book on 7 May 2021 and had further breached the implied contractual relationship of trust and confidence with the Company effective 8 May 2021 when he provides no explanation or alibi for the periods that he had stayed away from work beginning 8 May 2021. This Court is of the view that the Claimant's repudiatory breach and/or abscondment of employment beginning May 8, 2021 has been estopped or precluded him from claiming constructive dismissal effective August 16, 2021 as stated in the Notice of Constructive Dismissal which was emailed to the Company on 16 August 2021 vide the Claimant's Second Email.” [23] This Court looks at the reasons in the Award, whether there was an error that justifies the court's intervention. Based on the facts of the case, the Appellant himself admitted that there was no delay in paying salaries before by the Respondent. The Appellant also admitted that the Respondent had asked him to send a report for the work in July 2021 for salary payment to be made. What the Appellant contends is that this action was an “afterthought “, after the failure to reach a mutual agreement to terminate the contract. 10 [24] Based on the evidence, there is no repeated action that resulted in the Appellant's salaries not being paid before. Based on the e-mail that exchanged, it is clear that the Respondent has asked the Appellant to return to the office after negotiations failed, and has also asked the Appellant to provide the report related to his work, as the Appellant has left the office to work from home (without any evidence of the Respondent's permission) since 8.05.2021.The Appellant also did not deny of doing that, (not having going to the office) after the last time he did so on 7.5.2021. [25] The test to be applied in a case of constructive dismissal is clearly laid down by the Court of Appeal in BAYER’S CASE (SUPRA). In that case, the Court of Appeal held that if a workman wishes to rely on constructive dismissal based on the employer's cumulative misconduct, he must plead it by pleading the cumulative misconduct of his employer. Having done both, viz pleaded constructive dismissal and pleaded the cumulative misconduct of his employer, the workman must give or produce evidence at the trial before the Industrial Court to demonstrate that each misconduct was so connected with the culminating act of misconduct as to form part of the same transaction. At page 198, the Court of Appeal stated as follows: “Therefore, if cumulative misconduct is being urged it must be pleaded and evidence has to be given to show that each misconduct was so connected with the culminating act of misconduct as to form part of the same transaction”. [26] It is the finding of the Industrial Court that the Appellant (Claimant) has failed to prove on the balance of probabilities that there were 11 unreasonable actions by the Respondent which resulted in no work environment or there was past incident which forced the Appellant to take such actions. [27] This Court agrees with the findings and the opinion of the Learned Chairman of the Industrial Court that there is no evidence to show that the Respondent has acted unreasonably against the Appellant. In fact, the Respondent did ask the Appellant to come back to office and prepare them the report. On the other hand, in the Court's view, there was an intention on the part of the Respondent to continue the contract with the Respondent even though due to Appellant's failure and neglect of instructions (related to report duty and submits reports). [28] The Appellant argued that the Learned Chairman was in error when she failed to account for the Respondent's failure to take any action against the Appellant, if it is true, that the Respondent considers the Appellant to have committing a misdemeanor and this mistake caused the Chairman to draw the wrong conclusion. This error should be corrected. Those finding of facts by the Industrial Court are well-founded and supported by the facts and evidence during the trial that the Appellant had failed to prove that he was constructively dismissed by the Respondent. [29] Inthis case, the Respondent's main reason for not paying the salary is because the Appellant had failed to provide a report to the Respondent. Other reasons related to the reason that the occurrence of an afterthought is no longer relevant because the Appellant himself failed to submit the requested report before 9.8.2021 and also failed to return to work in the 12 office when asked to do so. There is no explanation why no report was submitted. The Appellant has also confirmed that he did not send the report without any explanation. [30] When instructions to return to work were given, failure to do so is a violation of the duties and directions that have been given before. This confirms the fact that, no more permission was given at that time, the Appellant should have agreed to return to the office (although it is not proven that it was given from the beginning). [31] Whether there is no need to provide the reports before this is no longer relevant when the Respondent repeatedly asked for the reports to be prepared in August for July’s works. The claim that no report was requested in May and June 2021 is no longer relevant because in the Respondent's e-mail it is clear that a report only needs to be prepared for July and not for the previous months. The Respondent's latest instructions must be obeyed as an employee. The Appellant’s claim that the report was never requested for the months of May and June 2021, but the salaries were paid, is no longer relevant. [32] The Appellant referred to the argument that work had to be done to enable the report to be prepared and argued that the report could not be prepared because there was no instruction from the Respondent to carry out the work. This argument is contradicted by the Appellant's own response, which was that during that period he was still doing "whatever works". If the work has been done, why cannot the report be produced? The finding of this fact by the Chairman is correct. 13 [33] The Appellant relies on “Clause 13. Port Folio, Duties and Responsibility” and argued that the Respondent should be responsible for not providing any work to him. But in this case, when the Respondent asked him to prepare the report, was it not a work order? When asked to come to the office, was that not a work order? Did the Appellant comply with the work order? (refer to Clause 13: “Port Folio, Duties and Responsibility” “You will carry out faithfully and conscientiously the duties and responsibilities that are assigned to you by the Company. You shall be wholly committed to the Company during the tenure of employment for whatever works assigned to you by the Company’). [34] Based on the facts, whatever the Respondent’s previous actions related to no instructions for work and permission to work from home, had been "cut off' when the instruction to attend the workplace / office and also prepare the report were given by the Respondent to be complied with. This is in line with Clause 13 of the contract which actually does not help the Appellant based on the facts of this case. The finding that the Appellant actually did not attend work at the office without written permission and failed to prepare a work report for the salary payment for the month of July 2021 to be paid and made, is not included in the principle of constructive dismissal. [35] No action was taken against the Appellant even though there was allegedly a violation of not preparing a report and absence from the office, showing that the Respondent still wanted to continue the employment 14 contract with the Appellant. This becomes clearer when the salary was paid for the months of March and June 2021 and the Respondent in the e-mail also never reclaimed the salary for the months of May and June 2021. [36] The fact that the Respondent failed to pay the Appellant's salary on or before 15.8.2021 is not amounted to breached of fundamental and does not go to the root of the contract. The Appellant refers to the case of KEJUTEREAAN SAMUDRA TIMUR SDN BHD V. SELI MANDOH & ANOR [2004] 1 CLJ 393, when it held that: “[2b] Contrary to the company's contention, the fact that there was no provision in the claimant's contract of employment allowing the company to reduce his salary if ever the business incurred losses was not an irrelevant consideration. The unilateral reduction of the claimant's salary amounted to to a repudiation of his contract of employment on the part of the company. It was a fundamental breach” [37] But in that case, it was clearly a breach of the contract when the salary was reduced, but in our case, the salary was delayed due to the Appellant's failure to follow the work order issued. The Respondent did mention that they want the report to be submitted in order to pay his salary for the month of July 2024. [38] The Appellant also refers to the case of SHUHAILA IBRAHIM & ORS V. ATLAS ONE MALAYSIA SDN BHD [2012] 4 ILR 209, where The Industrial Court ruled as follows: 15 "(1) The company had failed to pay the claimants’ salaries. Non-payment of salary was by itself a fundamental breach going to the very root of the employment contract between the parties. The company by its conduct limits repudiated the employment contract and no longer had an intention to honor the claimants' contracts. Thus, the claimants had been entitled to resign and treat themselves as being constructively dismissed.” [39] Based on the case of SHUHAILA IBRAHIM (SUPRA), the failure to pay the salary amounts to a breach of contract and entitles to consider as constructive dismissal due to the fact that ” the company by its conduct limits repudiated the employment contract and no longer had an intention to honor the claimants’ contracts”. [40] In our case, it was never intended by the Respondent to terminate the contract due to the Appellant's actions, yet he was given a chance. Even on 14.08.2021 and 18.08.2021, the Company still asking for report and the Appellant also, on 18.08.2021 was, still communicating with the Appellant about the report. [41] The Appellant's argument is based on the case of LIM CHUAN CHENG V. THE BORNEO CO LTD [1964] 1 LNS 87, cannot stand as it involves a termination of contract by the employer “after concerning condonation of disobedience and cannot subsequently dismiss the employee for the offense which he had by his subsequent warnings and conduct condoned” 16 [42] The Appellant who refused to comply with the instructions on 24.6.2021 and 29.06.2021. Therefore, the Respondent's claim that the Appellant is said to be in a hurry in issuing a constructive dismissal notice was rightly considered by the Industrial Court. The court found that this decision was accurate and did not require intervention. The Appellant failed, on balance of probabilities to prove his case, as follows: “(a) there must be a breach of contract by the employer: (b) the breach must be sufficiently important to justify the employee resigning; (c) the employee must leave in respond to the breach and not for any other unconnected reason; and (d) must no occasion any undue delay in terminating the contract, otherwise he will be deemed to have waived the breach and agreed to vary the contract.” [43] When it is decided that there is no constructive dismissal, other reasons no longer need to be reviewed or decided by the Court. The approach taken by the Industrial Court is not against the law for this court to set it aside., 17 Conclusion [44] When the Industrial Court finds that there is no basis for constructive dismissal, the other remedies are no longer significant and the conclusion of the Industrial Court is correct and must not be disturbed. [45] The award delivered by the Learned Chairman of the Industrial Court is hereby affirmed. This appeal is dismissed with a cost of RM5000.00 to be paid by the Appellant to the Respondent and subject to allocator. vcce eee eee SOA... cece AZIZAN MD, ARSHAD Judicial Commissioner High Court of Malaya at Pulau Pinang Dated: 18.01.2024 Counsel for the Appellant: Mohamad Nasruddin Bin Ab Rahman Nas Rahman & Co Peguambela & Peguamcara No. 23-2-H09, Tingkat, Jalan Wangsa Delima 5, Wangsa Maju, 53300 Kuala Lumpur 18 Counsel for the Respondent: Khoo Yu Jia Tetuan BP Ang & Tan No. 7-1, Lorong Usahaniaga 5, Taman Usahaniaga 14000 Bukit Mertajam Pulau Pinang Cases referred to: 1. NG TECK FAY V. MALAYSIAN COMPANY COURT & ANOR [2021] 10 CLJ 73 TAN POH THIAM V. INDUSTRIAL COURT OF MALAYSIA & ANOR [2015] 1 LNS 1534 PATCO MALAYSIA BERHAD V MUHAIYADI BIN HORMEN & ANOR [2017] MLJU 311 BAYER (M) SDN BHD V ANWAR BIN ABD RAHIM [1996] 2 CLJ 49 KEJUTEREAAN SAMUDRA TIMUR SDN BHD V. SEL! MANDOH & ANOR [2004] 1 CLJ 393 SHUHAILA IBRAHIM & ORS V. ATLAS ONE MALAYSIA SDN BHD [2012] 4 ILR 209 LIM CHUAN CHENG V. THE BORNEO CO LTD [1964] 1 LNS 87 19