Rights of Probationary Employees (Part 2)

CASE LAW: SULNAYAH BTE HJ MOHD ISA v SEKOLAH KANAK-KANAK PEKAK SELANGOR & ANOR [1999] 6 MLJ 249 – HIGH COURT (KUALA LUMPUR)

The case concerned a teacher who was appointed in the respondent’s school with effect from 12 June 1995, who needed to undergo a period of probation between 3 months to 1 year before she could become a confirmed employee. Approximately 9 months into her probationary period, she received a letter from the respondent informing her that she was given 1 month to improve her performance. Before the 1 month period ended, she was dismissed on the ground of her unsatisfactory performance before her probationary period ended. The Industrial Court ruled that her dismissal was with just cause and excuse.

This application was made for an order of certiorari to quash the award by the Industrial Court. Here, the Court held that the employer has no right to terminate an employee before the expiry of the probation period. However, the exception to the rule is where the employee has committed an act of misconduct. The onus is on the employer to prove that the dismissal was on the ground of misconduct of the employee.

The Court went on to say that misconduct connotes an act of non-disciplinary behavior and unsatisfactory performance could not come within the meaning of an act of misconduct.

In light of the above, the Court granted the application to quash the Industrial Court’s award and directed the Registrar of the Industrial Court to place this matter before another Chairman of the Industrial Court for a rehearing.

S.12 EMPLOYMENT ACT 1965

Notice of termination of contract

12. (1) Either party to a contract of service may at any time give to the other party notice of his intention to terminate such contract of service.

(2) The length of such notice shall be the same for both employer and employee and shall be determined by a provision made in writing for such notice in the terms of the contract of service, or, in the absence of such provision in writing, shall not be less than—

1. four weeks’ notice if the employee has been so employed for less than two years on the date on which the notice is given;
2. six weeks’ notice if he has been so employed for two years or more but less than five years on such date;
3. eight weeks’ notice if he has been so employed for five years or more on such date:

Provided that this section shall not be taken to prevent either party from waiving his right to a notice under this subsection.

CASE LAW: SULNAYAH BTE HJ MOHD ISA v SEKOLAH KANAK-KANAK PEKAK SELANGOR & ANOR [1999] 6 MLJ 249 – HIGH COURT (KUALA LUMPUR)

In the same case above, the judge opined that the employer should consider “giving the necessary assistance and cooperation” to enable the employee to improve including extending her probationary period so that she may achieve the standard of the performance required. The fact that the employer only gave her one (1) month to improve was regarded as insincere and without bona fide.

CASE LAW: MALAYAN BANKING BERHAD v MAHKAMAH PERUSAHAAN MALAYSIA & ANOR [2016] MLJU 919 – HIGH COURT (PULAU PINANG) – COLLIN LAWRENCE SEQUERAH JC

The case concerned an individual employed as a Financial Executive on a fixed term contract for a period of 1 year commencing from 18 Jan 2010, who needed to undergo a period of probation of not less than 6 months inclusive of 3 months of training and attending courses to enhance her skills as a Financial Executive. On 30 July 2010, the employee was not confirmed in her position, and she then filed a representation pursuant to Section 20(1) of the Industrial Relations Act 1967 pursuant to a Ministerial reference under Section 20(3) of the same act, adjudicating her case. It was held that she was terminated without just cause and excuse. 

In this application to quash the Award in finding a case of unfair dismissal, on the question on whether the employee was dismissed for just cause and excuse, the Court went on to say that the prerequisite before terminating an employee on grounds of poor performance is that he/she must be given sufficient opportunity to improve. Only if despite this, the employee fails to improve, can the employer dismiss the employee on these grounds.

As such, the Court allowed the application, awarded back wages limited to the unexpired duration of her fixed term contract (5 months and 2 weeks), and rescaling back wages of 40%.

CASE LAW: WONG CHOON MOEY v PRACTIMAX SDN BHD [2013] 2 ILJ – INDUSTRIAL COURT (KUALA LUMPUR) — AWARD NO 53 OF 2013 – MARY SHAKILA CH

The case concerned an employee who was employed on a 3-month probation period as a Senior Sales Manager and was terminated 2.5 months into her job. In the letter of termination, the company claimed that she was not dismissed, but rather not confirmed in her job due to her unsatisfactory performance. The claimant contended that she was terminated without just cause or excuse before the expiry of her probationary period as it was done with immediate effect and there was no warnings or appraisals done on her performance.

The Court made reference to the ratio decidendi of the case of IE Project Sdn Bhd v Tan Lee Seng, (Award No 56/87) (“IE Project”) and stressed that the dismissal for unsatisfactory work or incompetency should be preceded by warnings, and that it must be shown that the “work complained of was performed subsequent to warnings”. The Court further reiterated the opinion of the judge in IE Project that employers must be slow to dismiss employees who are found to be performing poorly or unsatisfactory without first warning them of the possibility of dismissal and giving them a chance to improve. Employers are responsible for finding out why their employees are performing unsatisfactorily and warning them that their continued unsatisfactory performance will result in their dismissal.

Having said that, the Court allowed the claim and awarded the claimant RM60,000 as backwages.

S.20 INDUSTRIAL RELATIONS ACT 1967

Representations on dismissals

20. (1) Where a workman, irrespective of whether he is a member of a trade union of workmen or otherwise, considers that he has been dismissed without just cause or excuse by his employer, he may make representations in writing to the Director General to be reinstated in his former employment; the representations may be filed at the office of the Director General nearest to the place of employment from which the workman was dismissed.

(1A) The Director General shall not entertain any representations under subsection (1) unless such representations are filed within sixty days of the dismissal:

Provided that where a workman is dismissed with notice he may file a representation at any time during the period of such notice but not later than sixty days from the expiry thereof.