SRI MAJU SARATA EKSPRES SDN BHD SEGAR A/L MUNUSAMY & 35 ORANG YANG LAIN

AA-16-16-09/2023 Kand. 44 17/09/2024 08:33:06 IN THE HIGH COURT OF MALAYA AT IPOH IN THE STATE OF PERAK DARUL RIDZUAN CIVIL APPEAL NO.: AA-16-16-09/2023 BETWEEN SRI MAJU SARATA EKSPRESS SDN BHD …APPELLANT [COMPANY REGISTRATION NO: 163851-X] AND 1. SEGAR A/L MUNUSAMY & 35 ORANG YANG LAIN …RESPONDENTS GROUNDS OF JUDGMENT 1 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal INTRODUCTION [1] This judgment concerns an appeal against the decision of the Industrial Court of Justice (ICJ) which ruled in favour of the Respondents in their claim against the Appellant, Sri Maju Sarata Ekspress Sdn. Bhd. The Appellant contests various aspects of the ICJ's decision, particularly the entitlement of the Respondents to full salary payments and the impact of their part-time employment during the claim period. After careful consideration, this Court upholds the ICJ's decision, finding that the appeal lacks merit. BACKGROUND FACTS [2] The Respondents in this case have sought from the Appellant the full payment of their monthly salaries, amounting to RM600 each, for the period commencing July 2020 and concluding in February 2021. [3] The Respondents comprise 36 individuals who assert their entitlement to the aforementioned salary payments. [4] Following a thorough examination of the case, the Industrial Court of Justice (ICJ) determined that the Appellant is liable to pay the aggregate sum of RM177,600.00 to the Respondents, covering the salary payments for the months from July 2020 until February 2021. [5] Aggrieved by the ICJ’s ruling, the Appellant has lodged this appeal against the decision rendered by the ICJ. 2 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal ISSUES TO BE DETERMINED [6] The Appellant contests the decision of the Industrial Court of Justice (ICJ) on several grounds, which are as follows:- (i) Whether the Appellant was the proper party to be sued by the Respondents; (ii) Whether wages are paid for work done only; (iii) Validity of the Consent Letter; (iv) Whether the Court should deny claims to specific Respondents on the basis of their withdrawal from proceedings and purported lack of comprehension regarding the proceedings; and (v) Whether the existence of part-time employment during the claim period should influence the quantum of the final award. (i) Whether the Appellant was the correct party to be sued [7] This issue pertains to the Appellant’s contention that Sri Maju is not the employer of all 36 Respondents, and consequently, Sri Maju is not the appropriate party to be sued by 25 out of the 36 Respondents. The Appellant argues that each Respondent should pursue claims against the 3 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal specific company with which they individually contracted. The Industrial Court has acknowledged that Sri Maju, Aneka, Azra, and Germuda are part of the same corporate group, sharing common ownership. While recognising the separate legal identities of these entities, the Industrial Court also noted that the corporate veil might be lifted where the operational realities of the group warrant such an approach. [8] Citing the case of Pamol (Sabah) Ltd & Anor v Joseph bin Paulus Lantip & Ors [2012] 15 MLJ, the Appellant asserts that Sri Maju, Aneka, Azra, and Germuda are distinct legal entities with separate rights and liabilities. [9] The Appellant maintains that, absent specific statutory provisions or instances where the corporate veil is pierced due to misuse of the corporate structure for fraudulent or improper purposes, the separateness of these entities should be upheld. Accordingly, liabilities incurred by one company should not be automatically attributed to another within the group. [10] Furthermore, the Appellant argues that each employment contract clearly designates the specific employer, which is the only entity liable under the contract. The Appellant relies on a contractual clause stating, "I agree to work at such times and at such place as the management may think fit," contending that this clause does not alter the identity of the designated employer. Despite the companies operating as a group, each functions under separate contracts, thereby reinforcing their legal independence. 4 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal [11] The Appellant submits that even if certain Respondents received their salaries from a different company than that named in their contracts, such payments were made purely for administrative convenience and do not signify a change in the employer. Evidence from SD1 (Pauline) supports the position that these transactions were merely procedural and should not affect the contractual relationships as defined by the respective employment agreements. [12] The Appellant contends that there is no evidence to suggest that the group of companies operated as a single integrated unit that would justify treating them as one employer. Without clear evidence of a unified operational structure overriding the individual corporate boundaries, the default position is to respect the separate legal identities of each company. [13] The principle that a company is a separate legal entity from its shareholders and other companies, even within the same group, is well- established in company law. This doctrine was firmly established in Salomon v. A Salomon & Co Ltd [1897] AC 22, where the House of Lords affirmed that upon incorporation, a company becomes a separate legal person distinct from its members. This principle underpins modern corporate law, allowing companies to own assets, incur liabilities, and enter into contracts independently of their shareholders or affiliated companies. [14] Nonetheless, the principle of separate legal entity is not absolute. Courts have recognised exceptions where the corporate veil may be pierced to prevent misuse of the corporate structure for fraudulent or improper purposes. The Federal Court, in Ong Leong Chiou & Anor v. 5 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal Keller [2021] 4 CLJ 821, outlined circumstances in which the veil might be lifted:- “[1] The juristic principle comprising the bedrock of company law is the legal fiction that, on incorporation, the corporate entity is clothed with a separate and distinct personality. It is a legal person distinct from its members (Salomon v. A Salomon & Co Ltd [1897] AC 22 (‘Salomon v. Salomon’)). There subsists a ‘veil’ between the company and its members that separates them for purposes of liability, property, capacity, and in relation to acts done or the acquisition of rights. The natural persons who are the incorporators are ignored. [2] However, the veil of incorporation is not entirely inviolable. One of the well-recognised and accepted exceptions to the principle of the separate personality of a company is where the legal entity of a corporate body is utilised for fraudulent, dishonest or unlawful purposes. Those seeds of limitation were set out in the locus classicus of Salomon v. Salomon (above) itself by Lord Davey: If … the company was formed for an unlawful purpose, or in order to achieve an object not permitted by the provisions of the [Companies] Act, the appropriate remedy (if any) would seem to be to 6 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal set aside the certificate of incorporation, or to treat the company as a nullity, or, if the appellant has committed a fraud or misdemeanour … he may be proceeded against civilly or criminally … In such circumstances, the person or persons perpetrating such abuse cannot hide behind the separate corporate personality. The courts will “break” the shell of incorporation, by utilising the doctrine of the “lifting or piercing of the corporate veil”. Our law journals are replete with case law on this subject.” [15] Justice Nallini Pathmanathan, in the above case, observed that the corporate veil may be lifted where it is shown that the company is being used as a façade to conceal true facts, commit fraud, or evade legal obligations. The burden of proof rests on the party seeking to lift the veil to demonstrate clear evidence of such improper use. [16] The issue of whether group companies can be treated as a single entity for legal purposes has been examined in cases such as Hotel Jaya Puri Bhd v. National Union of Hotel Bar & Restaurant Workers & Anor [1980] 1 MLJ 109 where Salleh Abas FJ (as he then was) stated as follows:- “It is true that while the principle that a company is an entity separate from its shareholders and that a subsidiary and its parent or holding company are separate entities having separate existence is well 7 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal established in company law, in recent years the court has, in a number of cases, by-passed this principle if not made an inroad into it. The court seems quite willing to lift “the veil of incorporation” (so the expression goes) when the justice of the case so demands. Thus the facts of the case may well justify the court to hold that despite separate existence a subsidiary company is an agent of the parent company or vice versa as was decided in Smith, Stone and Knight v. Birmingham Corporation; Re F.G. (Films) Limited; and Firestone Tyre & Rubber Co. v. Llewelyn, Professor Gower in his Principles of Modern Company Law, 3rd Edition, Page 213, said that the courts “are coming to recognise the essential unity of a group enterprise rather than the separate legal entity of each company within the group. Other examples of this can be found. In The Roberta (1937) 58 LJ. L.R. 159, a parent company was held liable on a bill of lading signed on behalf of its wholly owned subsidiary, the court saying that the subsidiary was ‘a separate entity … in name alone and probably for the purposes of taxation’. In another case, Spittle v. Thames Grit & Aggregates Ltd. [1937] 4 All E.R. 101, the court found no difficulty in treating a subsidiary as ‘to all intents and purposes’ the same as the parent company which held 90 per cent of its shares. A licensing authority in exercise of its discretion has 8 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal been held entitled to have regard to the fact that a parent and subsidiary company, though technically separate legal persons, in fact constituted a single commercial unit (Merchandise Transport Ltd. V. British Transport Commission [1962] 2 Q.B. 173, Devlin LJ. At page 202) … A good example of this is Bird & Co. v. Thos. Cook & Son [1937] 2 All E.R. 227, in which an indorsement of a cheque to ‘Thos. Cook & Son Ltd.’ was treated as an indorsement to the allied but separate company of Thos. Cook & Son (Bankers) Ltd. Regarding it as a mere misdescription to be ignored under the principle falsa demonstratio non nocet.” It is clear therefore that the approach taken by the President of Industrial Court is not without any legal support when he placed an emphasis on the essential unity of group enterprise which in this case consists of the Hotel and the Restaurant, especially when Datuk N.A. Kularajah who is the Managing Director of the Hotel was also the Managing Director and later a Director of the Restaurant and had the ultimate authority over the employees. Thus, the practice of treating the employees of the Restaurant as being separate from the employees of the Hotel such as the Union having been told that they were so, their salaries, their E.P.F. and SOCSO contributions being paid by the Restaurant, does not detract from the fact that the employees in question were in fact 9 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal working in one group enterprise. In my judgment, by giving recognition to this fact, the President did not cause any violence to the sanctity of the principle of separate entity established in Salomon v. Salomon & Co. but rather gave effect to the reality of the Hotel and the Restaurant as being in one enterprise. I find nothing unreasonable in the finding of the President by by-passing this principle.” [17] Similarly, in Sunrise Sdn Bhd v. First Profile (M) Sdn Bhd & Anor [1996] 3 MLJ 533, the Court acknowledged that while the principle of corporate personality is fundamental, it is not inviolable. Courts have intervened to pierce the corporate veil when companies are used to evade contractual obligations or perpetrate injustices. [18] In the present case, the central issue is whether Sri Maju, Aneka, Azra, and Germuda, despite being separate legal entities, should be treated as a single employer for the purposes of this legal action. The Appellant argues that there is no statutory or common law basis to deviate from the principle of separate legal entities. They assert that each Respondent's employer is clearly defined in their respective contracts, and payments made by other group companies are merely administrative conveniences that do not alter the contractual relationships. [19] To determine whether Sri Maju is the correct employer of all 36 Respondents, the court must consider not only the formal contracts but also the operational and managerial realities of the group. 10 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal [20] Evidence indicates that Sri Maju, Aneka, Azra, and Germuda are managed under a unified leadership and operate with a cohesive management structure. Testimony from SD5 confirms that these companies function as an integrated unit, blurring the lines between the formal legal separations of the entities. This unified management supports the view that Sri Maju effectively functions as the employer of all Respondents. [21] The use of the Sri Maju logo on uniforms and vehicles reinforces the perception that employees are working for a single employer. This common branding reflects the integrated nature of the group's operations and supports the Respondents' claim that they are employed by Sri Maju, regardless of the company name on their individual contracts. [22] Pay slips issued by Sri Maju to employees contracted with other group companies further illustrate the operational reality that Sri Maju oversees employment matters across the group. This cross-company administration of payroll substantiates the argument that Sri Maju acts as the principal employer, managing and overseeing employment conditions for all workers within the group. [23] The evidence demonstrates that Sri Maju, Aneka, Azra, and Germuda are not merely separate legal entities operating independently but function as a unified enterprise with shared resources, branding, and administration. [24] The issuance of pay slips by Sri Maju to employees of other group companies, combined with the use of the Sri Maju brand, highlights the integrated nature of their operations. This evidence indicates that the 11 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal companies operate without meaningful distinction in their day-to-day functions, effectively making Sri Maju the de facto employer. [25] The Respondents have successfully met the burden of proof, showing that Sri Maju and its related companies operate as a single economic entity. The operational integration, common branding, and unified management substantiate the Respondents' claim that Sri Maju is their true employer. This justifies lifting the corporate veil to prevent injustice and reflect the true nature of the employment relationships. [26] The principle established in Ong Leong Chiou provides a sound legal basis for treating Sri Maju as the employer, as failing to do so would permit the companies to unjustly shield themselves behind the facade of corporate separateness, to the detriment of the Respondents. [27] The Court finds that Sri Maju, Aneka, Azra, and Germuda operate as a single enterprise with integrated management and operations. Accordingly, Sri Maju is properly considered the employer of all 36 Respondents. (ii) Whether wages are paid for work done only [28] This issue concerns the entitlement of the Respondents, who are bus drivers employed by Sri Maju and associated entities, to receive their full basic wages during the Movement Control Orders ("MCO") period, despite the suspension of their usual bus operations due to Covid-19 pandemic restrictions. 12 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal [29] The Appellant contends that wages should be paid based on work performed, with the Respondents’ compensation traditionally linked to completed trips and supplemented by a seniority allowance. Since bus services were halted during the MCO, the Appellant argues that the Respondents are not entitled to the full wages stipulated in their contracts. Conversely, the Respondents claim entitlement to a basic salary of RM1200.00 as specified in their contracts, irrespective of the operational restrictions during the MCO. [30] The Appellant refers to Section 2 of the Employment Act 1955 and the principle established in the case of National Union of Hotel, Bar & Restaurant Workers Peninsular Malaysia & Anor v Mahsyur Mutiara Sdn Bhd (Sheraton Langkawi Beach Resort) [2017] 6 MLJ 265, asserting that wages are payments made for work performed under the employment contract. Consequently, no work performed means no wages are due. This aligns with the Appellant's payment structure, which is based on trip completion and seniority, not a fixed salary. [31] It is noted by the Appellant that the 'basic rate' on payslips is generated by payroll software and does not represent a fixed salary but is instead composed of trip allowances and a seniority allowance. Hence, in the absence of trips during the MCO, the Appellant argues that no wages should be paid. [32] The Appellant maintains that the Covid-19 pandemic and subsequent government-imposed MCOs resulted in a cessation of bus operations, which was beyond the Appellant's control. It argues that imposing an obligation to pay full wages when no trips were carried out 13 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal due to these restrictions would be unduly prejudicial. During the MCO, the Appellant received the Program Subsidi Upah ("PSU") from SOCSO and disbursed RM600.00 monthly to the Respondents, reflecting a good faith effort to alleviate the impact of the operational standstill without resorting to retrenchments. [33] The Appellant highlights the financial hardship it endured during the MCO, arguing that being compelled to pay the full basic wages without corresponding work would further exacerbate its losses. The Appellant emphasizes that the pandemic and resulting operational limitations were extraordinary circumstances that should be factored into any determination of wage obligations. [34] Section 2 of the Employment Act 1955 defines wages as "basic wages and all other payments in cash payable to an employee for work done in respect of his contract of service." This definition was elucidated in National Union of Hotel, Bar & Restaurant Workers Peninsular Malaysia & Anor v Mahsyur Mutiara Sdn Bhd (Sheraton Langkawi Beach Resort) [2017] 6 MLJ 265, where the Court of Appeal affirmed that wages are compensatory payments for work performed under the terms of employment. [35] The SOCSO PSU program was designed to support employers in sustaining wage payments during periods of business disruption caused by the pandemic. Compliance with the terms of such subsidy programs is integral to ensuring that employees receive the intended financial relief. [36] The crux of the matter lies in determining whether the Respondents are entitled to their basic salary of RM1200.00 during the MCO period 14 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal despite the lack of work. The evidence indicates that prior to the MCO, the Respondents consistently received this basic salary in addition to variable trip allowances. This established practice creates an expectation that the basic salary would continue irrespective of trip frequency. [37] The Appellant’s argument that wages are solely for work done, while grounded in statutory definitions, does not sufficiently address the contractual and practical realities established before the MCO. The payslip evidence suggests that the Respondents’ basic salary was a fixed component of their remuneration, not subject to reductions based on trip performance. [38] Furthermore, the Appellant’s receipt of the PSU subsidy from SOCSO was specifically aimed at enabling employers to maintain wage payments during periods of disrupted operations. The Respondents’ position that they are entitled to the full basic salary of RM1200.00, less the subsidy amount, is compelling under these circumstances. [39] The Court finds that the Respondents are entitled to their basic salary of RM1200.00 during the MCO period, notwithstanding the reduction in work opportunities. The Appellant’s payment of only RM600.00, derived from the PSU subsidy, fails to meet the contractual and statutory obligations towards the Respondents. The Appellant's financial hardship, while acknowledged, does not absolve it from its responsibilities to its employees under the employment contracts and the terms of the PSU program. [40] This court therefore finds that the Respondents are entitled to the outstanding balance of their basic wages for the MCO period, amounting 15 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal to RM600.00 per month, in addition to the RM600.00 already paid under the PSU subsidy. (iii) Validity of the Consent Letter [41] The third issue concerns the validity and enforceability of consent letters signed by the Respondents, relating to wage deductions implemented by the Appellant during the pandemic period. The central question is whether the deductions were lawful and whether the Respondents voluntarily consented to the wage reductions, or if the consent was obtained under duress or without full understanding of the terms [42] The Appellant argues that the Respondents voluntarily agreed to wage deductions as evidenced by signed consent letters for the periods from 1 July 2020 to 31 October 2020 and from 1 November 2020 to 31 January 2021, in line with the company's decision due to financial difficulties during the pandemic. However, critical analysis reveals that the Respondents' signatures on these consent letters do not unequivocally establish genuine consent to the wage reductions. [43] The Respondents consistently allege that they did not fully understand the content of the consent letters when they signed them, and some claimed that they were coerced into signing with threats of not receiving their wages. [44] Appellant’s witnesses, Pauline and Abdul Rahman, testified that they explained the contents and implications of the consent letters to all 16 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal Respondents, who then signed voluntarily. Additionally, Mohanraj A/L Ganason and Chan Meng Onn, employees of Sri Maju Sarata Ekspres Sdn Bhd and Aneka Jasaramai Sdn Bhd respectively, confirmed that they were similarly offered to sign the consent letters after understanding their contents, and they did so voluntarily without raising disputes until now. [45] The evidence indicates that, despite the explanations provided, several Respondents signed the letters under the impression that failure to do so would result in not receiving their wages. This raises significant concerns about the voluntariness of their consent. Notably, the principle of genuine consent requires that an individual is free from any form of undue influence or coercion when making a decision. The testimony that Respondents felt compelled to sign due to fear of non-payment undermines the argument of voluntariness. [46] Further, it is crucial to note that not all Respondents signed both consent letters. Specifically, Segar and Vedivelan did not sign any consent letter, yet wage deductions were still applied to them, demonstrating a lack of uniformity and consistency in the application of the alleged consent- based deductions. This inconsistency highlights the arbitrariness of the Appellant’s actions and casts doubt on the Appellant's claim that the wage reductions were mutually agreed upon. [47] Section 24 of the Employment Act 1955 governs permissible deductions from wages. However, the Act is silent on wage reductions due to business hardships like those faced during the pandemic, and it emphasizes that deductions must not be arbitrary or without lawful justification. The Appellant cites cases such as Lim Ban Leong v. Gold Bridge Engineering & Construction Bhd and Ting Hie v. HSBC Bank 17 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal Malaysia Berhad to argue that wage deductions could be permissible if undertaken in good faith during economic hardship. However, these cases do not directly address the Respondents' core argument: that their consent was obtained under duress or without full comprehension. [48] Furthermore, Section 7A of the Employment Act 1955 permits agreements on terms more favorable to employees than the statutory minimums but does not sanction agreements made under coercion or without informed consent. Therefore, any alleged agreement based on the consent letters must meet the threshold of voluntary and informed consent, which, in this case, is not convincingly demonstrated. [49] The Respondents also argue that the Appellant received wage subsidy assistance from SOCSO, which came with conditions prohibiting wage reductions for workers earning RM4,000 per month and below. The Appellant's actions appear to contravene these conditions, as wage reductions were applied indiscriminately, including to those who did not sign the consent letters. The breach of these conditions further invalidates the Appellant's actions and supports the Respondents' entitlement to the claimed wages. [50] In light of the evidence, it is apparent that the Respondents’ alleged consent to the wage reductions was not fully informed or voluntarily given, and some of the Respondents were coerced or misled into signing the consent letters. Moreover, the inconsistent application of the wage reductions, including to those who did not sign any consent letters, and the Appellant's failure to comply with SOCSO subsidy conditions further undermine the validity of the deductions. 18 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal [51] The Industrial Court’s decision to dismiss the Appellant’s claim on this issue is therefore upheld. The Appellant's appeal is dismissed, and the Respondents are entitled to the payment of their full wages for the relevant periods as claimed. The Court finds that the Appellant’s actions in implementing wage reductions were neither lawful nor justified under the prevailing circumstances. (iv) Whether the Court should deny claims to specific Respondents on the basis of their withdrawal from proceedings and purported lack of comprehension regarding the proceedings [52] The Appellant argues that certain Respondents, including Mohanraj A/L Ganason and Chan Meng Onn, should not be awarded compensation as they had voluntarily withdrawn from the proceedings after realizing that the claim was not against SOCSO but rather against Sri Maju for RM600 per month over an eight-month period. The Appellant further contends that the Respondents signed consent letters and submitted requests for unpaid leave to pursue other part-time work during the period in question, which demonstrates their understanding and voluntary disengagement from the claims against Sri Maju. [53] The Appellant's position is that these Respondents, having withdrawn and expressed a lack of interest in pursuing claims against Sri Maju, cannot now seek awards based on the same claims. The Respondents counter that their lack of understanding of the proceedings, should not bar them from being awarded their rightful salary payments. 19 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal [54] The Court recognizes that employment rights, including the right to wages, are fundamental and cannot be waived or negated by consent letters that were not fully understood or voluntarily executed. [55] The Respondents’ lack of formal education and basic legal knowledge further supports their claims that they were not fully aware of the implications of their participation or withdrawal from these proceedings. Their entitlement to wages arises from their employment relationship and should not be lightly dismissed on the basis of procedural misunderstandings. [56] The Court finds that the Respondents’ withdrawal from the proceedings and the signing of consent letters were not conducted with full understanding or voluntariness. Consequently, the Court should not deny awards to these Respondents based on the arguments presented by the Appellant. [57] The Respondents are entitled to the full payment of salaries as initially claimed. The Appellant's arguments regarding the Respondents' withdrawal and consent letters do not negate the Respondents' legal entitlements under their employment agreements. (v) Whether the existence of part-time employment during the claim period should influence the quantum of the final award [58] The Appellant argues that some Respondents engaged in part-time employment during the claim period without obtaining prior permission from their primary employer, the Appellant. Although the employers did not 20 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal raise any issues due to understanding the financial hardships faced by the Respondents during the pandemic, the Appellant contends that this part- time work should be considered when determining the final award. The Appellant maintains that the quantum of the final award should be reduced to account for the income earned through these part-time jobs. [59] In contrast, the Respondents argue that the Appellant’s implied consent to their part-time work, evidenced by the lack of disciplinary action or objection, should mean that their entitlement to full salary payment remains unaffected. They assert that the financial need to seek additional income does not negate their right to the full salary from their primary employer. [60] It is established that some Respondents undertook part-time jobs during the claim period. The Appellant has noted that these part-time jobs were pursued without formal permission, yet no formal objections or disciplinary actions were taken by the Appellant. The employers’ tacit acceptance of the part-time work due to the Respondents' financial needs during the pandemic does not constitute an explicit waiver of the Respondents’ rights to their primary employment salary. [61] The Respondents argue that the lack of formal action against their part-time work suggests an implied consent from the Appellant. Implied consent can be inferred from an employer's inaction or failure to object to certain employee behaviours. However, implied consent does not automatically translate to an agreement to forgo salary payments or to reduce the amount of salary owed. 21 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal [62] The Appellant’s understanding of the Respondents' financial situation does not equate to an acknowledgment of their right to reduce salary payments. Employers typically retain the right to enforce employment terms unless explicitly waived. The Respondents’ engagement in part-time work was not formally approved, and thus, the terms of their primary employment contract regarding full salary payments should be upheld. [63] While acknowledging the financial hardships imposed by the pandemic, the issue of reducing the final award must be considered in the context of contractual obligations and employee entitlements. The fundamental principle of employment law is that employees are entitled to their agreed-upon salary unless there is a clear contractual provision allowing for deductions or reductions. [64] The Respondents’ decision to take on additional work to meet financial needs does not inherently diminish their entitlement to their primary salary. If the part-time work was not officially sanctioned, it should not affect their rights under their primary employment contract. The Appellant’s inability to enforce restrictions on part-time work due to the extraordinary circumstances does not create a basis for reducing salary awards. [65] Given the circumstances, the Respondents’ part-time employment, though undertaken without formal permission, does not constitute a valid reason for reducing their salary awards. The financial hardship they experienced does not negate their entitlement to the full salary as per their employment contract. 22 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal [66] It is thus in my conclusive finding that the final award for the Respondents should not be reduced based on their engagement in part- time work during the claim period and the Respondents are thus entitled to their full salary payment as claimed. CONCLUSION [67] Having reviewed the facts, legal principles, and case law, this Court concludes that the appeal lacks merit. In light of the above, this Court upholds the decision of the ICJ in favour of the Respondents. Thus, dismissed the Appellant’s appeal with costs of RM5,000.00 is to be paid by the Appellant to the Respondents and the Respondents are entitled to their full salary payments as determined by the ICJ. Dated: 10.09.2024 23 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal Pihak-pihak: Tetuan Chan & Associates bagi pihak Perayu Peguamcara & Peguambela No. 1, 1st Floor Jalan Tun Sambanthan 30000 Ipoh Perak Tel: 05.25452931 Faks: 05.2534091 Ruj: CKK/RL/SAYA/cc/14419/2021 Emel: chanipoh2@gmail.com Peguamcara: Encik Robin Lim Fang Say Tetuan Ellan & Co bagi pihak Responden-Responden Peguamcara & Peguambela No. 210, 2nd Floor Tokio Marine Life Building 45-C, Jalan Tun Sambanthan 30000 Ipoh Perak Tel: 05.2530605 Faks: 05.2540605 Emel: ellan_co@yahoo.com Peguamcara: Encik T. Ellanggovan a/l Thambiraju Encik Logaprieyan a/l Arichandran 24 S/N OcZahGqn1EuzdmrIvZ61mA **Note : Serial number will be used to verify the originality of this document via eFILING portal