Gainful employment represents the bread and butter of every society. It ensures the continuation of an individual’s livelihood and the pursuance of the right to livelihood automatically invokes the larger right and that is, the Right to Life. In Malaysia, this is guaranteed by Article 5 of the Federal Constitution.
When a dispute occurs between an employer and an employee in Malaysia, recourse may be sought by parties to the dispute at the Industrial Relations Department and then to the Industrial Court. The Industrial Relations Act 1967 regulates relations between employer and employee, particularly at the Industrial Relations Court.
Representations
Where a workman considers that he has been unfairly dismissed without just cause or excuse, he may, through the enabling section 20 of the Industrial Relations Act 1967, make representations in writing to the Director General to be reinstated in his former employment within sixty days (60) of the dismissal or if dismissed with notice, within the period of such notice but not later than sixty days (60 days) from the expiry of such notice.
The workman will not be allowed to submit a complaint after sixty days (60) have passed.
Representations should be made at the office of the Director General nearest to the place of employment from which the workman was dismissed. Section 2 Industrial Relations Act 1967 provides that a “workman”:
means any person, including an apprentice, employed by an employer under a contract of employment to work for hire or reward and for the purposes of any proceedings in relation to a trade dispute includes any such person who has been dismissed, discharged or retrenched in connection with or as a consequence of that dispute or whose dismissal, discharge or retrenchment has led to that dispute
Conciliation / Settlement
Upon the Director General receiving such representations from the workman through section 20 Industrial Relations Act 1967, the Director General shall take necessary steps to try and reach an expeditious settlement at this period. However, where the Director General deems that it is not likely to reach a settlement, the Director General shall refer the representations to the Industrial Relations Court for an award.
The Director General at the Industrial Relations Department will facilitate a meeting known as a “Conciliation” where both the employer and the employee are required to attend. This is carried out with the aim to attempt to settle the dispute.
Legal representations at this Conciliation meeting at the IR Department are not allowed. This means no lawyer may be brought in to act for employer or employee at this stage. Section 20(6) Industrial Relations Act 1967 however, provides for whom may represent an employer and employee at the Conciliation stage.
Prior to the coming into force of the Industrial Relations (Amendment) Act 2020 on 1st January 2021, it was the practice that should a settlement fail to be reached at the Conciliation stage under section 20(2) Industrial Relations Act 1967, the Director General will then notify the Minister of Human Resources. It is then the duty of the Minister of Human Resources who will then refer the dispute to the Court, if he thinks fit.
However, and at present, post the coming into force of Industrial Relations (Amendment) Act 2020, cases not resolved through Conciliation by the Director General will now be automatically rereferred to the Court by the Director General without the need to notify the Minister of Human Resources. This therefore would expedite the unfair dismissal process to the Court as there is no need for the Minister of Human Resources to filter the disputes.
Proceedings at the Industrial Court
The dispute once at the Court, will be registered as a case and ‘Form F – Notice of Mention of Case’ will be issued to parties by the Court. Form F provides details such as the Hearing dates, court instructions on filing documents or any other pre-hearing detail. At this stage, parties will be known as the Claimant (who is the employee) and the Company (who is the employer). Parties may also be legally represented by a lawyer at this Court stage of proceedings.
Under section 3 and 4 of the Industrial Court Rules 1967, both Claimant and Company must file in the IR Court, Form A – Application To be Represented By A Legal Practitioner and Form B – Warrant of Authority depending on the type of representation they choose.
Subsequently, other such necessary preparations will be made by parties which include the filing of a Statement of Case by the Claimant with its respective bundle of documents, then the filing of a Statement In Reply by the Company also with the Company’s bundle of documents, filing of a Rejoinder (if necessary) by the Claimant, as well as (but not limited to) the filing of witness statements.
Once the abovementioned documents have been filed by both Claimant and Company, the registrar of the Industrial Relations Court will issue a ‘Notice of Hearing’ under Form G of the ICR 1967 where a Hearing date will be fixed.
The Hearing at the Industrial Relations Court works in the same way as an actual civil trial at the civil courts where witnesses are called to be examined and cross-examined. However, the Evidence Act 1950 is not utilised during the Hearing at the Industrial Relations Court because the Industrial Relations Court is a quasi-judicial tribunal and is not subject to technical and legal considerations as compared to the civil courts. The Industrial Relations Court relies on section 30(5) of the Industrial Relations Act 1967 which provides that the Industrial Relations Court shall act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal form.
With the submission by both parties of their case, their evidence given and cross-examination carried out, the Industrial Relations Court will ultimately seek to determine whether the Claimant was dismissed with ‘just cause and excuse’.
The basic principle of industrial jurisprudence is that the employer must produce convincing evidence for the dismissal. The burden of proof of just cause and excuse lies on the employer to proof that the dismissal was a valid measure. The standard of proof or proving that the dismissal was carried out with just cause and excuse is on the balance of probabilities.
An award, which is a decision, shall be made by the Industrial Relations Court (which includes an interim award) after both parties have filed their respective written submissions. The practice is that an award will usually be pronounced within 30 days from the parties’ last submissions in the Industrial Relations Court.
In making the award, the Industrial Relations Court shall have regard to public interest, the financial implications and the effect of the award on the economy of the country and the industry concerned. The effect it will have on related or similar industries will also be taken into account.
In making an award, the industrial court will take into consideration the factors specified in the 2nd schedule. The 2nd schedule of the Industrial Relations Act 1967 provides that:
- Backwages, if given, shall not exceed twenty-four months from the dismissal based on the last-drawn salary of the person who has been dismissed without just cause or excuse;
- A probationer shall not be given backwages of more than twelve months from the date of dismissal based on his last drawn salary;
- Should there be post-dismissal earnings, then a percentage of such earnings, to be given by the Court shall be deducted from the backwages given;
- There shall be no relief for loss of future earnings;
- Relief shall not take into account contributory misconduct of the workman.
According to the Industrial Relations Act 1967, should the Industrial Relations Court make a finding that the employee was dismissed without just cause and excuse, the employee will typically be awarded either (i) reinstatement and backwages or (b) compensation in lieu of reinstatement and backwages. In practice however, since reinstatement may be difficult as the relationship between employer and employee would have broken down, the awards usually given are compensation in lieu of reinstatement. This is typically awarded on the basis of 1 month’s salary for every year of service.
Additionally, backwages are also awarded to cover the period between the date of dismissal and the date the Court makes the award. A 24-month limit is fixed for confirmed employees which is based on the employees last drawn salary and a 12-month limit for probationers. This is however still subject to mitigation and discretionary considerations such as if the employee has sought alternative employment.
An appeal against an award to the High Court may be made pursuant to section 33C of the IRA 1967 if any party is dissatisfied with the Industrial Relations Court’s award. This request for an appeal must be made within fourteen (14) days of the day on which the party received the decision.
Conclusion
Overall, with the presence of the Industrial Court, the Malaysian industrial jurisdiction affords the workman a good avenue for protection to seek a remedy if he feels that he has been dismissed without just cause or excuse. The completion of a case filed at the Industrial Court will generally take about 6 to 8 months to be completed. The Court always seeks to strike a balance between the constitutional right of a workman to his livelihood and the employers right to dismiss a workman with just cause & excuse.
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