INDUSTRIAL COURT MALAYSIA

CASE NO. 17/4-99/13

BETWEEN
CHEOK SWEE AIK
AND
TALI MAJU SDN. BHD.

AWARD NO: 1216/2015

BEFORE

: YA TUAN DUNCAN SIKODOL

Chairman (sitting alone)

VENUE

: Mahkamah Perusahaan Malaysia, Kota Kinabalu, Sabah

DATE OF REFERENCE: 26.12.2012

DATES OF MENTION : 15.03.2013 & 30.06.2014
DATES OF CASE MANAGEMENT: 23.04.2013 & 12.11.2013
DATES OF HEARING: 23.09.2013, 19.06.2014, 13.08.2014, 15.09.2014 &
16.10.2014 & 18.10.2014
REPRESENTATION

: For the Claimant S. Vanugopal

Messrs S. Vanugopal & Partners
For the Respondent- Ms Catherine Chau
Messrs Catherine Chau & Associates

REFERENCE

This is a reference by the Honourable Minister of Human Resources under Section

20(3) of the Industrial Relations Act 1967 ("the Act") arising out of the dismissal of
CHEOK SWEE AIK (hereinafter referred to as the Claimant) by TALI MAJU SDN.
BHD. (hereinafter referred to as the Company) on the 1st April 2012.

AWARD

Brief Background Facts

1.

The Claimant had been engaged by the Company, whose business is in the
operation of slot machines as the Deputy General Manager since the 1 st July
2005 pursuant to the 1st Letter of Appointment dated the 1st December 2005
(CLB-1 page 3-7) at a basic monthly salary of RM10,000.00 and a petrol
allowance of RM300.00. Prior to joining the Respondent Company, he worked
for Maxi Legacy Sdn Bhd. He was subsequently promoted to the position of
General Manager with effect from the 1st January 2009 wherein his basic salary
was revised to RM13,500.00. As the General Manager the Claimant directly or
through his subordinate officers carried out the following duties and
responsibilities:
(a)

Manage, direct and control the gaming, restaurant and recreation operations of the
Company at its two Clubs in Kota Kinabalu, viz, Cherry Club at Inanam and Arriva Club at
Lintas Plaza;

(b)

Approve payment vouchers;

(c)

Ensure that the collections from the slot machine operations and from other activities

such as

restaurant and the recreation outlets are deposited into the Companys bank account and that
the deposits tally with the collections;
(d)

Receive and review the monthly reports on Slot Machine Collections Summary;

(e)

Ensure that the daily gaming operation, the restaurant business and the recreation outlets are
efficiently carried out by the Manager who reports directly to the Claimant and who (i.e the
Manager) is assisted by Executives and Supervisors;

(f)

Ensure that the gaming taxes on the slot machine collections are promptly paid to the Ministry of
Finance; and

(g)

Implement policies and decisions of the Group Executive director on the operations of the
Company.

2.

On the 12th December 2011, the Claimant was issued with a show cause letter
by the Company requiring him to explain why the dinner for 22 persons
instructed by the Group Executive Director (GED), Mr HC Lim, was not
organized on the 9th December 2011. The Claimant in his reply admitted to the
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mistake and accepted responsibility as he mistook the dinner to be hosted on

the 22nd December 2011. The Group Executive Director (GED) was however
dissatisfied with his reply and gave the Claimant a stern warning via letter dated
the 23rd December 2011 alleging that he was not only negligent but also totally
irresponsible and disrespectful towards the management.

3.

On the 22nd January 2012, the Claimant received a new letter of appointment
dated the 1st January 2012 from the Company which stated as follows:

You are required to work on schedule, which will be given to you upon
commencement of employment
Agreed normal working hour is 8 hours per day inclusive of breaks, however, the exigencies of
the business may require you to work longer hours from time to time, including weekends

4.

Pursuant to paragraph 9 of the Claimants new Letter of Appointment on working

hours, the GED with effect from the 22 nd February required the Claimant to work
on a daily split shift hours from 10.00 am to 2.00 pm and from 8.00 pm to 12
midnight.

5.

On the 7th March 2012, the Claimant protested in writing against the daily split
shift working hours to the GED stating that with effect from the 8th March 2012,
he will strictly comply with the working hours stipulated in his first Letter of
Appointment ie from 9.00 am to 5.00 pm and that he shall no longer work on the
daily split shift hours.

6.

Following the said letter, the Claimant alleged that he incurred the wrath of the
GED whereby he was victimized, harassed and abused. He also alleged that his
powers as a General Manager were withdrawn. The Claimant as a result then
issued a notice of constructive dismissal dated 28th March 2012 setting out his
complaints on the withdrawal of his powers as the General Manager and
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requiring the Company to reinstate those powers by the 2 nd April 2012 and that
in default he shall consider himself unlawfully terminated. The Company through
its letter dated the 30th March 2012 however denied the contents of the
Claimants letter and on the 31st March 2012, issued him with a notice of
termination of his services pursuant to Clause 10 of his new Letter of
Appointment with effect from the 1st April 2012 with the payment of 1 months
salary in lieu of notice.

The claimant now contends that his dismissal by the Company was without just
cause or excuse. He therefore seeks to be reinstated to his former position or be
given compensation in lieu of reinstatement.

Witnesses

7.

The following witnesses testified at the hearing of this case:

COW1

Stephen Chin (Security Manager) and his witness statement was

marked as COWS-1

COW2

Lee Wen Yee (Operations Manager, Tali Maju Sdn Bhd) and her
witness statement was marked as COWS-2

COW3

Chong Siew Kum (Manager at Arriva Club, Lintas Plaza) and her
witness statement was marked as COWS-3

COW4 -

Nancy Tseu Shu Mee (Accounts Supervisor Arriva Club, Lintas

Plaza and her witness statement was marked as COWS-4.

COW5

Lim Heok Chye (Director, Tali Maju Sdn Bhd) and his witness
statement was marked as COWS-5.

CLW1 -

Cheok Swee Aik (Claimant) and his witness statement was marked
as CLWS-1.

The following bundle of documents were also used in court and marked as
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follows;

CBOD-1- Email from Respondents Ex Director to Claimant

CBOD-2- Companys Supplementary Bundle of Documents
CBOD-3- Companys Supplementary Bundle of Documents No.2
CLBOD-1- Claimants Bundle of Documents
CL-1- Claimants penyata cukai pendapatan

The Law
8.

In the often cited case of MILAN AUTO SDN BHD v WONG SHE YEN (1995) 4
CLJ 449, the duty of the Industrial Court in dismissal cases on a reference
under s. 20 has been propounded by His Lordship Mohd Azmi FCJ as follows;

As pointed out by this Court recently in Wong Yuen Hock v Hong Leong
Assurance (1995) 3 CLJ 344, the function of the Industrial in dismissal cases
on a reference under s. 20 is twofold: first, to determine whether the misconduct
complained by the employer has been established and secondly whether the
proven misconduct constitutes just cause or excuse for the dismissal

It is trite law that the Company bears the burden to prove that the claimant had
committed the alleged misconduct and the conduct warrants the Claimants
dismissal. See Ireka Construction Bhd v Chantiravanathan a/l Subramaniam
James (1995) 2 ILR 11 (Award No. 245 of 1995).
The Company needs only to prove misconduct justifying the dismissal or
termination on the balance of probabilities. See Telekom Malaysia Kawasan
Utara v Krishnan Kutty a/l Sanguni & Anor (2002) 3 CLJ 314 (CA).

Issues for determination

9.

In this case, it is an undisputed fact that the Claimants service was terminated
by the Company on the 1st April 2012 vide letter dated the 31st March 2012.
(Page 1 CLBOD 1). Having heard the evidence adduced before me, I agree with
the Learned Counsel for the Company that the issues to be considered in this
case are as follows;
a. Whether the termination of the claimants employment is a valid termination
pursuant to a contract
b. Alternatively, If the court finds that the Claimant was dismissed and not that
his services were validly terminated, then the question for this Court to
consider is whether the dismissal of the Claimant was with just cause or
excuse.

Whether the termination of the Claimants employment is a valid termination

pursuant to a contract?

Companys contention

10.

It is the Respondent Companys contention that the Claimant in this instant case
was not dismissed from employment but rather his Contract of Employment was
terminated. Since it is a termination as opposed to a dismissal, it is therefore the
Respondents submission that the termination of the Claimants employment
was a valid termination because under Clause 10 of his letter of Appointment
dated 1st January 2012, his contract can be terminated without assigning any
reasons whatsoever by paying the Claimant 1 months salary in lieu of 1 month
notice.
According to the Company, since the Claimant had signed the 2 nd letter of
Appointment and since there was no evidence adduced before this Court that he
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was coerced into signing it nor was there evidence to show that he did not
understand its contents, the Claimant by signing on the letter of Appointment is
deemed to have taken the benefit of that new contract of Employment fully.
Based on this, the learned Counsel for the Respondent Company submitted that
the Claimant cannot now be seen to approbate and reprobate from the contract
he has agreed to and urged this court to dismiss the Claimants claim.

11.

The Claimants counsel on the other hand contended that the mere fact that the
termination of the Claimants employment was in accordance with the
termination clause in the claimants new Letter of Appointment, it would only
make the termination contractually valid, but the Industrial court as a Court of
equity and good conscience has the duty under a reference under s.20 of the
IRA 1967 to inquire whether that termination was with just cause or excuse. The
Counsel drew the Courts attention to the case of Innorprise Corporation Sdn
Bhd, Sabah v Sukumaran Vanugopal, Sabah (1993)1 ILR 373 where the IC in
its judgment referred to the judgment of Gajendragadkhar J in the Indian
Supreme Court case of R.B Diwan Badri Dass v Industrial Tribunal Punjab,
Patiala & Ors AIR 1963, SC where it was stated that:
In settling disputes between the employers and the workmen, the function of the tribunal is not
confined to administration of justice in accordance with law. It can confer rights and privileges
on either party which it considers reasonable and proper, though they may not be within the
terms of any existing agreement.it has not merely to interpret or to give effect to the
contractual rights and obligations between them which it considers essential for keeping
industrial peace.

12.

It is also the claimants contention that although he signed the 2nd Letter of
Appointment, he did not do so voluntarily. He alleged that at the time he signed
the said letter, he did not know that he had to work on a daily split shift. He
however worked for 2 weeks under the new arrangement but claimed that he did
so under silent protest. He also alleged further that he was not consulted
beforehand about the new arrangement.
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Evaluation of Evidence and findings

13.

Clause 10 of the Claimants letter of Appointment dated the 1st January 2012
provides as follows:
You will be required to give a notice period of one (1) month should you wish to terminate your
employment with the Company or pay salary in lieu of notice. Likewise, the Company may
terminate your services without assigning any reasons whatsoever by giving you one (1) month
notice or salary in lieu thereof.

14.

In the case of Zakiah Ishak v Majlis Daerah Hulu Selangor (2005) 4 CLJ 77, a
case referred to me by the learned counsel for the Respondent, the Court of
Appeal held that:
1. Clause 9 of the contract of Employment is very clear that the defendant had the right to terminate
the plaintiffs services upon giving her a 3 month notice in writing or 1 months salary in lieu of such
notice.
2. That the plaintiff accepted the offer of employment on those terms and she cannot now complain
3. The learned judge was right in holding that the termination of the plaintiffs contract of employment
was in accord with the defendants rights under Clause 9 thereof;
4. That the motive or reason for the termination was strictly a matter for the defendant as the employer,
5. That the plaintiffs contract of employment was terminated; she was not dismissed. There was,
therefore, no necessity to afford her an opportunity of being heard,
6. The fact that there were allegations of misconduct made against the plaintiff did not preclude the
defendant from terminating the plaintiffs contract of employment.

15.

Having considered the evidence adduced before me and having analysed the
submissions of both parties, I find that the relationship between the claimant and
the Respondents company was contractual in nature, wherein it expressly
provides that the employment of the Claimant can be terminated without
assigning any reasons thereto by giving the requisite notice or payment of salary
in lieu thereof. To me, the facts of this case are no different from those of Zakia
and I therefore agree with the Respondents Companys Counsels submission
that the termination of the Claimants employment is a valid termination pursuant
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to Clause 10 of the 2nd Employment Agreement dated the 1st January 2012. I do
not agree with the learned counsel for the Claimants contention that just
because this Court is a Court of good conscience and equity, this Court should
ignore the sanctity of contracts and modify the contractual rights and obligations
of the parties as in the case of Innoprise Corporation Sdn Bhd Sabah v
Sukumaran Vaugopal (Supra).

16.

The allegation of the Claimant that he did not know that he had to work on daily
split shift at the time he signed the 2nd Letter of Appointment in my view cannot
be sustained as he in cross examination admitted that he knew that working on
schedule meant having to work on shift. The Claimant confirmed that he
understood the terms and conditions in the said letter and thus was free to
accept or reject its terms and conditions. He however accepted them by signing
on the last page of the letter on the 22nd January 2012 without protest. Thus, by
signing on the 2nd Letter of appointment, he is deemed to have taken the benefit
of that new contract of employment wholly. In Zakias case, the Court of Appeal
also held that the motive or reason for the termination was strictly a matter for
the Respondent Company as the employer. Thus, the fact that there was an
allegation of misconduct against him did not preclude the Respondent Company
from terminating the claimants contract of employment. Therefore, based on
this ground alone, I dismissed the Claimants claim.

17.

Even if the Claimant was dismissed from his employment as opposed to being
terminated pursuant to contract as claimed, I am still of the considered view that
his dismissal was with just cause or excuse.

18.

Clause 18 of the claimants 2nd Letter of Appointment expressly provides that;

1. If the Claimant fails to obey and comply with all orders and direction given
to him by the Respondent Company, or
2. If he misconducts,
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Then this will be deemed a breach of the contract of employment which renders
the Claimant liable to dismissal by the Respondent Company without notice.

19.

In paragraph 10 of the Claimants statement of case, he alleged that from the 2 nd

week of December 2011, he was victimized, harassed, abused and then
dismissed from his services because he failed to organize a dinner for 22
persons to celebrate the birthday of the Group Executive Director, one H.C Lims
daughter at the Companys outlet at Cherry Chinese Restaurant. This resulted in
the 2nd letter of appointment which the Claimant claimed was issued without any
prior consultation and drastically changed his working hours.

20.

In refuting the above allegation, COW5 testified that whatever the Claimant had
done wrong, he had already been issued a warning letter. It has nothing to do
with his termination of service. The shift in the Claimants working hours
according to COW5 was necessary following the shifting of the office premises
from Sadong Jaya to Luyang and the Claimant was based at Cherry Cafe
in Inanam. As a result of the move, it was necessary for the Claimant to cover
night operating hours at the outlets which the Claimant was overseeing and it
was during the evening which is when the outlets are at their busiest.

21.

From the evidence adduced before me, I cannot find any evidence of mala fide
on the part of the Respondents Company to support the Claimants allegation
that the change in the working hours of the Claimant which culminated in the
issuance of the 2nd letter of Appointment was as a result of the Claimants failure
to organize the dinner for COW5 on the 9th December 2011. What happened on
the 9th December 2011 according to COW5 had already been dealt with by
giving a stern warning to the Claimant. The said change in the Claimants
working hours from the evidence adduced was to me nothing more than a
business decision by the Respondents Company to improve its operation due to
the expansion of its business because COW5 testified that evening is when the
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outlets are at their busiest. The decision to change the Claimants working hours
is the managements prerogative and is not unlawful neither does it constitutes
unfair labour practice. It is a purely a business decision to improve its
operations. See Elya Designs Sdn Bhd v Mahkamah Perusahaan Malaysia &
Anor (2011) 3 CLJ 929. Therefore the claimant in my view cannot insist on his
previous working hours due to the Companys expansion. Thus, the Claimants
insistence in his letter to the Respondent company dated the 7 th March 2012 to
unilaterally adhere to the previous working hours even after signing the 2 nd letter
of Appointment voluntarily and his actual act of not working on split shift from the
8th March 2012 onwards unilaterally but instead at his own time schedule of 9.00
am to 5.00 pm is a clear defiance of the Respondent Companys instruction
which in my considered view amounts to insubordination justifying dismissal.
The Federal Court in Pan Global Textiles Bhd Pulau Pinang v Ang Beng Teik
(2002) 1 CLJ 181 reiterated that disobedience of lawful orders is a serious
misconduct.

22.

The Claimants claim that his act of merely notifying the Respondent Company
in his letter dated the 7th March 2012 that he would strictly comply with the
working hours as stipulated in his 1st Letter of Appointment dated 1st December
2005 and that he would no longer work on daily shift should not be interpreted
as an act of insubordination, cannot be sustained as he in this case went ahead
to work on 9 to 5 basis unilaterally from the 8 th March 2012 onwards, in blatant
disregard of the Respondent Companys instruction. In Len Omnibus Co Ltd v
Transport Workers Union (1991) 1 ILR 484, the Industrial Court held that
challenging the authority is therefore, contrary to the basic character of the
employer

and

employee

relationship.

This

will

therefore

constitute

insubordination.

23.

I find no merit in the Claimants claim that he did not know that he had to work
on daily split shift at the time he signed the 2nd letter of Appointment as he
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himself admitted in cross examination that he knew that working on schedule

meant having to work on shift. As a General Manager, he knew that working on
shift can also involve split shifts. He also knew that split shifts are not something
that is new in the Respondent Company. As stated earlier, if indeed the Claimant
did not know that his working schedule can also involve split shifts, then he
should have protested at the first available opportunity, which he did not. He
instead worked for almost 2 weeks and only protested after realizing that the
schedule was inconveniencing his life..

24.

My findings that there was no mala fide in the issuance of the 2nd Letter of
Appointment nor was it intended to victimize the Claimant is fortified by the fact
that there was no change to the salary or position or the number of working
hours of the Claimant. There were 4 working hours each totaling 8 hours and not
14 hours a day as claimed with ample time in between shifts. Thus, there is
therefore no contravention of s.104 (1)(c) of the Sabah Labour Ordinance. In
any case, I agree with the Respondent companys Counsel that the Sabah
Labour Ordinance does not apply in this case as the Claimant does not fall
within the definition of employee which is defined as someone earning a salary
of not exceeding RM2,500.00 per month. Further, it is also the evidence of
COW5 that the Claimant was required to work on shifts as and when required as
they are involved in the operations side and this applies even to the other
managers as testified by COW2 and COW3.

25.

Apart from that, it is also the Claimants further allegation that his powers as
General Manager were withdrawn from the afternoon of the 23rd March 2012
onwards whereby among others his powers to approve payment vouchers were
not sought. However, this was denied by COW5 in his answer to question 41 of
COWS-5 where it was shown at pages 85-96 of COB-2 where he was still
allowed to sign payment vouchers after 23rd March 2012. COW2 and COW3
also testified that they did not receive instructions from their superiors not to let
13

the Claimant approve payment vouchers. COW2 went on to testify that even if
the Claimant went to the work premises, he did not always sign payment
vouchers that were left in his tray. COW2 further testified that sometimes she
would be the alternative person who would approve the payment vouchers if she
happened to be around. COW2 went on further to state that the payment
vouchers would progress to the next level of approval by the Executive Director
of the Respondent Company even without the Claimants initial or her initials, so
as not to delay payment. Thus, I therefore find that these allegations are
baseless. The same goes with the allegation that the communication of daily
sales revenue and access to the management log book were curtailed.

The Decision

26.

In conclusion, taking into account the totality of the evidence adduced by both
parties and bearing in mind s. 30(5) of the IRA 1967 to act according to equity,
good conscience and the substantial merit s of the case without regard to
technicalities and legal form, this court holds that based on the reasons herein
aforesaid, the dismissal was with just cause or excuse. Hence, the Claimants
case is hereby dismissed.

HANDED DOWN AND DATED THIS DAY OF 20th OCTOBER 2015.

- sgd (DUNCAN SIKODOL)

CHAIRMAN INDUSTRIAL COURT MALAYSIA
CAWANGAN SABAH

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