âThe court is of the view that honesty and integrity are amongst the key characteristics that any employee should possess, no matter what form of employment the employee is engaged in.â quoted from the case of Southern Bank Berhad v Azmi Ali  1 ILR 614. When it comes to termination of contract of employment, an employer has many ways to terminate an employee. One of the ways is by terminating the employee on the ground of misconduct. The Employment Act 1955 gives employers the right to dismiss, downgrade or impose any other lesser punishment on an employee who has been found guilty of misconduct.
A conduct is an action that is not consistent with the conditions of employeeâs contract or service. According to Section 14 subsection (1) of the Employment Act 1955, an employer may, on the grounds of misconduct inconsistent with the fulfilment of the express or implied conditions of his service, after due inquiry dismiss without notice the employee or downgrade the employee or impose any other lesser punishment as he deems just and fit, and where a punishment of suspension without wages is imposed, it shall not exceed a period of two weeks. It covers an infinite range of activities, not necessarily confined to the workplace, which with the legitimate interests of the employer.
BURDEN OF PROOF
The disciplinary action for misconduct can only be done by using the burden of proof. The burden of proving misconduct is to justify dismissal lies on the employer. The employer has to establish such misconduct to the standard of a balance probabilities. The employer can only terminate if there is just cause or excuse. He has to prove that he has just cause or excuse for the decision to impose the disciplinary measure of dismissal upon the employee. The burden of proving misconduct is divided into two, appropriate reasons and acceptable procedure. Yang Arif Rajendran Nayagam in Galaxy Portfolio Sdn Bhd v Suradi Sulaiman (Award No. 158 of 2006)  1 ILR 187, Industrial Court Kuala Lumpur in his Award quoted the case of Lord Donaldson in Construction & Allied Trades Technician Union v Brain  1 RLR 224 âthe employer has to show why in fact he dismissed the employee. This is no great burden upon the employer, since he will know why he dismissed the employeeâ.
One of the burden of proof for misconduct is an acceptable procedure. There is two components in acceptable procedure. Firstly is statutory laws which will fully refer to The Employment Act 1955, under Arrangement of Sections, part II which is Contract of Service, Section 14 Termination of contract for special reasons. According to Section 14 subsection (1) of Employment Act 1955, an employer may, on the grounds of misconduct inconsistent with the fulfilment of the express or implied conditions of his service, after due inquiry dismiss without notice the employee or downgrade the employee or impose any other lesser punishment as he deems just and fit, and where a punishment of suspension without wages is imposed, it shall not exceed a period of two weeks. Under Section 14 subsection (2) of Employment Act 1955, for the purposes of an inquiry under subsection (1), the employer may suspend the employee from work for a period not exceeding two weeks but shall pay him not less than half his wages for such period if provided that if the inquiry does not disclose any misconduct on the part of the employee the employer shall forthwith restore to the employee the full amount of wages so withheld. Secondly is by using case law as an acceptable procedure. Case law in this ground is domestic inquiry and principle of natural justice.
Next proof is an appropriate reason or also known as grounds of termination for misconduct. Some of the example of appropriate reasons for termination would be the employee was caught in action in selling companyâs information to companyâs rivals or the employee has harassed his colleagues at the workplace or may be stealing companyâs property. There are two types of misconduct that can be used as appropriate reasons for taking the decision.
TYPES OF MISCONDUCT
Most misconduct occurs at the workplace during working hours. Misconduct can be classified as either major or minor depending the severity. The classification is important as it affects the penalty chosen. Major misconduct is when a serious action or failure to act by an employee happened, that may result in written warnings or dismissal without notice or downgrading after due inquiry. Some of the examples of major misconduct will be being drunk at work or on drugs at work, fighting among one another or stealing companyâs property.
On the other hand, minor misconduct is an offences that warrants verbal warning for single incident but progress to more severe disciplinary action and eventual dismissal for persistent offender. The offence must be not serious enough to take serious or warning, but if allowed to be repeated often, the offence will become a major misconduct. Examples for minor misconduct will be lateness of coming to work, inappropriate clothes on workplace, or may be by using rude language toward his colleagues. It is impossible to make a list of acts of misconduct and classify them as major or minor. A lot depends on the circumstances.
GENERAL GUIDELINES ON TAKING DISCIPINARY ACTION
When disciplinary action is necessary, general guidelines on taking disciplinary action should be kept in the employerâs mind. Firstly, it should be expected. Employees must know the rules of the organization and penalties for breaking the rules. Every worker should be given a copy of rules and be offered an oral explanation to ensure he understand. Later the employee will be asked to sign a copy of rules stating that he has read and understood those rules and he agrees to abide them. By doing it, the employee cannot complain that he was not told about the rules of the organization. The copy should be filed in employeeâs personal file. Moreover, it should be given in private. Any disciplinary action especially an oral warning should be given in private. No worker likes to be embarrassed in front of his colleagues. Praises and recognition for a good work should be given in public.
Plus the action should be consistent against the employees who commit misconduct. This is probably one of the trickiest area in disciplinary action. Consistency means that the same act of misconduct committed by two workers should lead to the same penalty. By leading to the same penalty, there should be no question on supervisorsâ favourites being permitted to break the rules while others being punished. Not to mention that it will likely to destroy morale of the workers when one supervisor usually ignores acts of misconduct while another is very strict on taking action. Therefore, different supervisors must give the same penalties to their subordinates when rules are broken. Consistency also requires any time of misconduct is committed and the employer becomes aware of it, a penalty will follow. Next, it should be immediate. Disciplinary action should be taken immediately after misconduct is discovered. However, hasty action is not advisable. The management should take into consideration to take adequate time to find out the facts of the case. Management should never rely on hearsay. The proof of misconduct is necessary.
Lastly is by having a progressive discipline. The objective here is to correct employeeâs behaviour rather than punish him. The method used is by increasingly severe penalties be imposed on workers who repeat an act of misconduct. In other words, the worker would be given a light penalty for the first act of misconduct that is not very serious. However, for the second time he repeated the same misconduct, then the penalty will be heavier. It is necessary for the organization to have a clear policy on the time period after which an employeeâs record will be considered clear. Surely it is unfair that the same act of misconduct is repeated for years after the first offence but still to be considered as minor nature. In a progressive disciplinary system, the penalties begin with an oral warning and counselling session. No formal records would be kept, but the supervisor should keep a note of any discussion. If an oral warning fails to correct the employeeâs behaviour, a written warning should be given. Mostly companies will give up to three warnings before moving on to the next stage. In these warning letters, the misconduct should be described in detail with reference to any previous oral warnings. It is also useful to include a brief statement explaining the purpose of the rule which has to be broken. A written warning should include the statement of the problem, identification of the misconduct committed, the consequences resulting from the act of misconduct, the corrective action required of the employee, the proposed action by the employer for failing the corrective action and lastly the reference to previous warnings and dates of the warnings.
PROCEDURE PRIOR TO TERMINATION DUE TO MISCONDUCT
An employee may be dismissed for misconduct, however the misconduct must be major and a fair procedure must be followed prior to the dismissal. When an employee is accused of committing a major misconduct, a full written report providing details of the alleged misconduct should be prepared. If the person who makes the complaint does not provide sufficient information, the company may need to conduct a full-scale investigation. The investigator or may be a team of investigators must collect and gather all available evidences so that a case may be brought against the worker concerned. The issues that will be ask by the investigator such as what rules, express or implied were broken or what or where did the alleged misconduct occur or how was the misconduct carried out or may be other than witnesses, are there any other types of evidence available to prove the guilt of the accused worker, the questions can be vary as it will be focusing on finding the evidence for alleged misconduct.
At the end of the investigation, on the investigation report will recommend whether enough evidence has been collected to suggest that the organization has sufficiently strong case to take action against the employee. Moreover, the report will also be helpful to identify any weaknesses in management system which allowed the employee to commit the misconduct. Therefore, the investigation report has short term use and will be helpful in the future, making the report has both immediate. If the investigator decides a prima facie case exists that is there is enough evidence to proceed with disciplinary action, then the employer can organize a domestic inquiry to hear the evidence against the employee. A prima facie is a Latin expression meaning on its first encounter or at first sight. However according to law perspective, the meaning of prima facie is the evidence before trial is sufficient to prove the case unless there is substantial contradictory evidence presented at trial.
Once the organization decided to proceed with the alleged misconduct, at this stage many organization may decide to suspend the employee from work. According to Section 14 subsection (2) of Employment Act 1955, for the purposes of an inquiry under subsection (1), the employer may suspend the employee from work for a period not exceeding two weeks but shall pay him not less than half his wages for such period. It is also states that provided that if the inquiry does not disclose any misconduct on the part of the employee, the employer shall forthwith restore to the employee the full amount of wages so withheld.
Suspension may be necessary if the workerâs presence might threaten the work situation or when it is suspected that the employee may have the opportunity to tamper with the documentary evidence or threaten witnesses or when it is necessary to remove the employee from the opportunity to continue his misconduct such as embezzlement of company funds is suspected. If the employee is within the scope of Employment Act, then clearly the employer has the right to suspend the employee prior to the holding of a formal inquiry into his misconduct. However, if the employee is not within the scope of Employment Act, the employer has no right to suspend the employee without pay or on half pay, unless the employment contract has a clause on this matter. If the employer believes that it would be prudent to suspend the employee, he must pay the employee his normal wages during the period of suspension.
Employers need to issue a letter commonly called as a show-cause letter as it is a widespread practice for employers. A show cause letter is a formal letter that need to be issue to an accused employee at some point during investigation demanding an explanation for his behaviour. It is essential that employer follow the proper procedures before dismissing an employee. This is to avoid any problem that may occur in the future.
Misconduct mostly happen at the workplace during working hours. A lot of the acts of misconduct depends on the circumstances, making it is impossible to make a list and classify these acts as major or minor. When it comes to taking disciplinary action, the employers need to follow all five (5) of the general guidelines on taking the disciplinary action. The guidelines are as listed here, it should be given in private, it should be expected, any action should be consistent, it should be immediate and lastly it should be progressive. Not only that, when an employee is accused of committing a major misconduct, the employer need to start following the procedures prior to dismissing an employee who is guilty of committing a misconduct. Any acts of misconduct that committed should be follow with a penalty. The punishment or penalty will be impose according to the severity of the misconduct. Besides that, the investigation report should be clear and helpful for the company in deciding whether the act of misconduct by the employee is with just cause or excuse or without just cause and excuse.
SUMMARY OF CASE STUDY
INDUSTRIAL COURT OF MALAYSIA CASE NO. : 12(3)(8)/4-422/10
SYLVIA TAN SIOK ENG V MALAYSIAN AIRLINE SYSTEM BERHAD
(AWARD NO.: 1149 OF 2015)
This is a reference made under Section 20(3) of the Industrial Relations Act 1967 arising out of the dismissal of Sylvia Tan Siok Eng (âthe Claimantâ) by Malaysian Airline System Berhad (âthe Companyâ) on 10 November 2008. The reference was dated 26 January 2010 and was received by the Court on 8 April 2010.
Brief Facts of the Case
This is a case whereby the Claimant was dismissed by her employer, Malaysia Airline System Berhad on 10 November 2008. The allegations against the Claimant arose after the Company’s Head of Human Resource, Ahmad Jallani Abdul Rahman received two anonymous letters on 11 March 2008 and 28 March 2008 respectively. These letters were forwarded to the Company’s Security Department for further investigations and as a result, the Company sent a letter of allegation to the Claimant. The Claimant responded by way of an undated letter. The Company unsatisfied with the explanation, issued a Notice of Disciplinary Inquiry dated 6 August 2008 with 9 charges against the Claimant as follows:
Charge 1: On 15 March 2008 the Claimant had absent from workplace from 1300hrs to 2100hrs without approval.
Charge 2: On 15 March 2008 the Claimant had travelled to Kuching on MH2803 MYY/KCH whereby the Claimant should be on duty at MYYAP check-in counter from 1300hrs to 2100hrs.
Charge 3: At Airport Operation MYYAP office the Claimant had forged attendance dated 15 March 2008 by signing the attendance sheet, whereby the Claimant were not present for duty on the said date.
Charge 4: That the Claimant as Traffic Officer of the Company, had changed duty with Traffic Office Zahbar Sidi staff no: 0375029 from 13 March 2008 to 15 March 2008 without approval from superior.
Charge 5: On 22 February 2008 the Claimant had absent from workplace from 1300hrs to 2100hrs without approval.
Charge 6: On 22 February 2008 the Claimant had changed duty with Traffic Clerk Afda Bin Mohmmad staff no: 1065621 on 22 February 2008 without approval from the Claimantâs superior.
Charge 7: On 13 March 2008 at MYYAP the Claimant had abetted with Traffic Officer Zahbar Bin Sidi, staff no. 0375029 by replacing his duty from 13hrs till 2100hrs without approval from superior whereby the Claimant were on rest day for the said date.
Charge 8: On 13 March 2008 at MYYAP the Claimant had made a false claim on overtime/meal pay return for the month of February 2008 whereby she were not present for duty on the said date.
Charge 9: On 13 March 2008 at MYYAP the Claimant had made a false claim on overtime/meal pay return for the month of March 2008 whereby she were not present for duty on the said date.
The Claimant was found guilty on 8 out of the 9 charges of misconduct against the Claimant by The Disciplinary Inquiry Panel. The Claimant was found not guilty in respect of charge 8. On 10 November 2008, the Company proceeded to dismiss the Claimant from her employment after the finding of guilt by the Domestic Inquiry Panel. The Claimant in her Amended Statement of Case and Statement of Rejoinder disputed the charges, stating that mutual exchanges of shift duties between employees was a common practice and denied the other incidental charges. The Claimant argue that her dismissal from the Company was without just cause and excuse.
EVALUATION AND DECISION
It is trite law that charges against a Claimant must be precise and concise in order for the Claimant to respond and defend herself against the charges. In this case, it is obvious that the charges framed against the Claimant is inconsistent and confusing. The Investigating Officer of the case (COW-1) and the person who drafted the charges against the Claimant agreed during the cross-examination that some of the charges were in a contradiction with each other and can lead to confusion. Based on the above reason, this Court finds that the charges are misleading.
Change of Roster/Swapping Shifts
The Company contends that there is a circular regarding mutual roster changes dated 2 November 1999. The circular reads that âstaff working on shift maybe permitted to change their duty roster provided it is on the same day with the consent from both parties and approved by the Section/Department Head concerned. The change must not incur any extra cost to the Company.â The Claimant’s superior (COW-5) confirmed that he had not received any application from the Claimant for the shift change. The Claimant in her evidence states that shift exchanges was common practice that was condoned by the Company. The Claimant also gave some of the evidence of shifts took place without the permission of the superior officers from the daily rosters.
False Claims of Overtime and Meal Allowance
The issue arises when the Claimant was not present on 22 February 2008 and 15 March 2008 but had signed in on Daily Attendance to claim for her overtime and meal allowances. The Claimant testified that on each occasion where shifts were swapped, the original person rostered will take the overtime and/or meal allowance according to the original roster in order not to confuse the accounts department. As such the situation as it arose caused no loss of monies to the Company and was common practice.
The totality of the evidence adduced by the Claimant and the Company and bearing in mind Section 30(5) of the Industrial Relations Act 1967, this Court finds that the Claimant’s dismissal was without just cause or excuse.
It is obvious that the Claimant is partially responsible for the misconduct. The system as practiced in the Miri office was inconsistent and not clear and the Claimant’s colleagues also practiced the system. Thereby, the Claimant should not be blamed fully for the misconduct. The Court is hereby deducts 50% of the backwages as contributory misconduct.
RM2,856.00 x 24 months : RM 68,544.00
Less : 50% : RM 34,272.00
(ii) Compensation in lieu of reinstatement
RM2,856.00 x 29 months (one month for each year of service) : RM 82,824.00
AWARD SUM : RM117,096.00
The amount of RM117,096.00 if applicable, is to be paid by the Company to the Claimant through his counsel Messrs Ranbir S. Sangha & Co within 30 days from the date of this Award.