INDUSTRIAL COURT MALAYSIA

CASE NO. 17/4-1064/15

BETWEEN

NINA CHUA SIOK PIN

AND
MUSIM INDAH SDN. BHD.

AWARD NO: 1276/2016

BEFORE

: Y.A. TUAN DUNCAN BIN SIKODOL

Chairman (sitting alone)

VENUE

: Mahkamah Perusahaan Malaysia, Kota Kinabalu, Sabah

DATE OF REFERENCE: 08.10.2015

DATE OF MENTION

: 14.12.2015

DATE OF CASE MANAGEMENT: 01.02.2016

DATES OF HEARING : 26.04.2016, 27.04.2016 & 17.06.2016
REPRESENTATION

: For the Claimant Joan P N Goh

Messrs Goh & Associates
Advocates & Solicitors
For the Respondent - S. Vanugopal
Messrs S. Vanugopal & Partners
Advocates & Solicitors

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
NINA CHUA SIOK PIN (hereinafter referred to as the Claimant) by MUSIM INDAH
SDN. BHD. (herein referred to as the Company).

AWARD
Brief Background Facts
The Claimant's employment with the Company commenced on the 1st September
2013 as the F&B Manager at its Sandakan Citi Club in Sandakan. The Claimant
through her letter dated the 23rd July 2014 to the Directors of the Company, one
Madam Theresa Kwok, requested for a transfer to Kota Kinabalu to take care of her
ailing father. When she did not receive any reply from the Company, the Claimant's
immediate superior, one Wong Fatt Chien told her to go on leave from the 1 st
September 2014. The Claimant had on the 2nd September 2014 tried to set an
appointment with Madam Theresa Kwok but was unable to do so until the 9 th
September. Following the meeting, the Claimant claimed that she was dismissed when
the said Theresa Kwok informed her that there was no point transferring her to any
other club as she did not meet her target and she was basically offered to leave the
Company with 2 months' salary. The Company on the other hand denied that the
Claimant was dismissed following the meeting but instead claimed that the Company
acceded to the Claimant's request on humanitarian grounds and offered to transfer her
to the Cherry Cafe, a Club in Inanam owned by the Company via Letter of
Appointment dated 12th September 2014. At the time of her alleged dismissal, her last
drawn salary was RM6,426.00 per month.
Claimants case

In paragraph 23 of the Claimants statement of case, she contended that she was
dismissed by the Company when Madam Theresa Kwok allegedly told her at a
meeting on the 9th September 2014 that as she did not meet her sales targets in
Sandakan there was no point in posting her to any other Club and that she was offered
to leave the Company with a payment of 2 months' salary. At paragraph 31, she also
pleaded that she was constructively dismissed on the following grounds:
(a)

She was a Club Manager from 2010 to 2013.

3

(b)

She was downgraded as F&B Manager in 2013 and served at Chempaka Pub
for the period of 6 months under the supervision of Madam Neily.

(c)

After 6 months of service at Chempaka Pub, she was then transferred to

Sandakan Citi Club by the Group as F&B Manager,

(d)

The Company knowing full well that the Claimant is to take care of her aged and ill
father however chose to transfer the Claimant to Sandakan.

(e)

The Claimant then request to be transferred back to Kota Kinabalu in a proper way
however it was rejected and her services were literally terminated.

(f)

The Claimant was informed to go on leave by the Company until further notice.

(g)

The Company gives no response whatsoever to the Claimant for her request to
be posted as the Claimant is ready for duty.

(h)

The Claimant was alleged of not to have hit the unreasonable sales target set by
the Company during her service at Sandakan Citi Club.

(i)

The

Claimant

was

the

offered

months'

salary

to

leave

the

Company. The Claimant has been dismissed without just cause and excuse on
09.09.2014.

(j)

The Claimant was not given an opportunity to be heard with a proper inquiry.
The

Company and/or the Group has ignored this important aspect which is

against the principles of natural justice.

(k)

The Claimant at the meeting on the 09.09.2014 was requested to leave the
Company with no opportunity of being heard and/or to defend herself of the
allegation which contravene the principles of natural justice and procedural fairness.
4

(l)

After the Claimant informed the Company that the Claimant will be engaging a
lawyer to deal with the Company, the Company then decided to post the
Claimant to Cherry Club and assigned the Claimant under the said Mr. William
Wong. The Group and/or the Company knows full well that the Claimant was
not in good term with the said Wong. This posting is clearly an afterthought.
Refer page 45 of Claimant's Bundle of Documents.

(m)

The Claimant has at all times discharged her duty differently and had done so
much to promote the business of the Company and/or the Group since year
1999 for the period of 15 years (up to 2014).

(n)

The Company and/or the Group's action are with malice by degrading the
Claimant which had caused her reputation and dignity to be severely
diminished.

(o)

The dismissal without just cause and excuse caused the Claimant to suffer much

embarrassment among all colleagues, relatives and friends, mental anguish and
loss of faith and confidence in the Company and/or the Group management.
The Claimant only managed to secure a job after 3 months of unemployment.

(p)

The Claimant has been unemployed and loss of income for a period of 3
months.

(q)

All these events caused anxiety, pressure and distress to the Claimant.

(r)

As a result of the unbearable and unpleasant events as stated above, it

amounted to breach of the implied obligation and mutual trust and confidence
which drove the Claimant out of the employment and destroyed the foundation
of the contract of employment. A repudiatory breached had occurred which
went to the root of the contract and this shows the Company/Group chose no
5

longer intended to be bound by its contracts and hence the Claimant chose not
to accept the posting to Cherry Club and treating herself having been
constructively dismissed by the Company.

Companys case

The Companys case is that while it is true that the Claimant had failed to achieve her
sales targets while in Sandakan, Madam Theresa Kwok never asked the Claimant to
leave the Company with a payment of 2 months' salary or at all.

Witnesses

The following witnesses testified at the hearing of this case:

CLW1 -

Adrian Liew and his witness statement was marked as CLWS-1

CLW2 -

Nina Chua Siok Pin and her witness statement was marked as CLWS-2.

COW1 -

Wong Fat Chien, Senior Manager of the Company and his witness
statement was marked as COWS-1

COW2 -

Nicole Chong Shiew Yan, Human Resource Manager of the Company and
her witness statement was marked as COWS-2

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

Claimants BOD marked as CLBD 1 and CLBD 2, Warning letter of misconduct to the
Claimant marked as CL1, Companys BOD marked as COBD 1 and COBD 2.

Issues for determination

The issues for the Courts determination in this case are as follows;
1. Whether this is a Constructive dismissal case.
6

2. Whether the dismissal was with just cause or excuse.

The Law

The Law relating to constructive dismissal has been clearly set out by the Supreme
Court in the case of Wong Chee Hong v. Cathay Organisation (M) Sdn Bhd. [1988]
1 CLJ 45; [1988] 1CLJ (Rep) 298 where Salleh Abas, L.P, has stated:
The common Law has always recognized the right of an employee to terminate his contract of service and
therefore to consider himself as discharged from further obligation if the employer is guilty of such breach
as affects the foundation of the contract or if the employer has evinced or shown an intention not to be
bound by it any longer. It is an attempt to enlarge the right of the employee of unilateral termination of his
contract beyond the perimeter of the common law by a unreasonable conduct of his employer that the
expression constructive dismissal was used.

The principle of law enunciated in the above case is that once constructive dismissal is
proven by the Claimant employee, the burden shifts to the respondent employer to
prove that the Claimants removal is with just cause or excuse. If the employer is guilty
of conduct which is a significant breach going to the root of the contract of
employment, or which shows that the employer no longer intends to be bound by one
or more of the essential term of the contract, then the employee is entitled to treat
himself as discharged from any further performance. If he does so, then he terminates
his contract by reason of the employers conduct. He is constructively dismissed. The
employee is entitled in those circumstances, at the instant without giving notice at all
or, alternatively, may give notice. But the conduct must in either case be sufficiently
serious to entitle him to leave at once. Moreover, he must make up his mind soon after
the conduct of which he complains; for if he continues for any length of time, without
leaving, he will lose his right to treat himself as discharged. He will be regarded as
having elected to affirm the contract. See Western Excavating (ECC) Ltd. V. Sharp
[1978] QB 761.

Hence, whether there was constructive dismissal under s.20 of the IRA 1967, the test
to be applied is the contract test and no longer the unreasonableness test. In Anwar
Abdul Rahim v Bayer (M) Sdn. Bhd. [1998] 2 CLJ 197 the Court of Appeal restated
the above test as follows:It has been repeatedly held by our courts that the proper approach in deciding whether constructive
dismissal has taken place is not to ask oneself whether the employers conduct was unfair or unreasonable
(the unreasonableness test) but whether the conduct of the employer was such that the employer was
guilty of a breach going to the root of the contract or whether he has evinced an intention no longer to be
bound by the contract. (See Hoilday Inn Kuching v Elizabeth Lee Chai Siok [1992] 1 CLJ 141 and
Wong Chee Hong v Cathay Organisation (M) Sdn. Bhd. [1988] 1 CLJ (Rep) 298).

Thus in Anwar Abdul Rahim v Bayer (M) Sdn. Bhd. (supra), in order to succeed in a
claim for constructive dismissal, the Claimant must establish the following:i. That the Company, by its conduct, had breached a term or terms of his contract
of employment or has evinced an intention no longer to be bound by the
contract;
ii. The breach must be a fundamental breach going to the root or foundation of the
contract;
iii. The claimant must leave in response to the breach and not for some
unconnected and ancillary reason;
iv. The claimant did not delay too long in terminating the contract in response to the
companys breach, otherwise he may be deemed to have waived the breach.

In this instant case, the claimant in her statement of case has pleaded 2 completely
different allegations namely dismissal by the employer without just cause or excuse as
well as constructive dismissal and in the said pleadings she has pleaded termination
by the employer first before her claim of constructive dismissal.
From the evidence adduced before me and by virtue of the principle laid down in
Anwar's case above, this is not a case of constructive dismissal but rather a
8

termination from employment by the employer as it does not satisfy the test laid down
in Anwar's case. There is no evidence before me that the Claimant who alleged
constructive dismissal notified the Company to rectify the complaints before making
the representation under s. 20 of the IRA 1967 and that after being so notified, the
Company failed to remedy the same. See Southern Bank Bhd v Ng Keng Lian &
Anor (2002) 5 MLJ 553. Neither was there any evidence to show that there was a
fundamental breach by the Company going to the root of the contract. Apart from that,
the Claimant in her pleadings pleaded termination of service and at the sometime
claimed constructive dismissal. This in my view is procedurally wrong as one can only
claim to be constructively dismissed or terminated from employment but not both.
Here, the Complainant went off believing that her service was terminated after a close
door meeting with the said Company Director one Theresa Kwok on the 9th September
2014 where in the said meeting Theresa Kwok allegedly told her that there is no point
posting her to any other club and that the Claimant was offered to leave the Company
with 2 months salary. This in the view of this Court is a dismissal case by the employer
by way of conduct. When the said Theresa Kwok uttered those words as alleged, the
Claimant in pursuant to that walked out believing that her service was terminated.
I disagree with the Company that the Claimant was the one who walked out of her
employment on her own violation. I also disagree that the Company had acceded to
her request via new letter of appointment dated the 12th September 2014. This is
because the evidence that she was terminated on the 9th September 2014 in the
meeting remained undisputed since the Company failed to call Theresa Kwok to
dispute the same. The evidence of COW2 to this Court is of no value as it is her
evidence that she only joined the meeting later and do not know the conversation that
transpired. Thus, I therefore agree with the Claimant's counsel that the said letter of
Appointment dated the 12th September 2014 which according to the testimony of
COW2 that she was asked by Madam Theresa Kwok to prepare pending discussion
with other Directors is an afterthought.
9

Whether dismissal was with just cause or excuse

The Law
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 was
stated 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).

In refuting the Company's allegation that she did not meet the sales target whilst she
was posted to Sandakan, the Claimant in paragraph 25 of her pleadings stated as
follows:
1. The Club was a newly opened Club after long period of renovation whereby
during the period of September 2013 to October 2013, only the restaurant of the
Club was operating whilst the Gym Room and Pub were still under renovation.
2. The food catered / supplied from the restaurant under the supervision of the
10

Claimant to the slot machine rooms were not accounted as sales to the
Claimant.
3. Only the sales from the walk in customer of the restaurant were accounted for
sales.
4. During the service of the Claimant at the Club, the business of the restaurant
has improved.
5. At the time the Claimant took over the position of F&B Manager of the Club, the
sales for the previous month of the Club was only at RM69,921.00 (August
2013).
6. With the management and effort contributed by the Claimant, the sales of the
Club has increased from RM69,921.00 to RM112,000.00 and with the record of
RM120,435.00 for the month of May 2014.
7. During the off peak season, with the effort of the Claimant, the sales still
maintained at RM86,188.00 for the month of March, ie right after Chinese New
Year festival. The sales record by the Claimant is and was at anytime higher
than August 2013 ie at RM69,921.00 only.
8. During the management of the Claimant, the sales of the Club were constantly
growing.
9. The employment of staff was controlled and limited by the Company. The gym
room was limited to 1 staff only and the kitchen of the restaurant is short of
manpower. The Claimant was not able to increase the manpower as there are
limited budget for staffs recruitment.
10. During peak hours, there are short of manpower in the kitchen to cater for the
demand which angered the customers.
11. The Claimant say that the restaurant was always full however there are lack of
manpower in the kitchen to serve the customer which affected the sales.
12. The Claimant as F&B Manager was also required to be in charge of the gym
facilities which is not under the scope of work of the Claimant, however the
Claimant continued to serve the Company with her full dedication.
13. The Claimant was also required to do purchasing of seafood and other material
11

at the fish and wet market of Sandakan personally in the early morning to cater
for the demand.
14. The sales target of the Company of RM116,000.00 per month to the Claimant is
unreasonable and with ulterior motive. The Company is fully aware that the
sales of the Club is very low as it can be seen from the sales in August 2013 ie
RM69,921.00

only

however

the

Company

set

the

sales

target

of

RNM116,000.00 for the Claimant to meet. Furtherance to that, the food catered
to slot machine rooms was not to the account of the sales of the Claimant. The
Claimant say that it is impossible to hit the sales target with such
restriction/limited resources and short of manpower as aforesaid.

The Law

The law to justify a case of poor performance is well established in the case of Sime
Darby v Mathi Arasu M Kalimuthu (1991) 2 ILR 836 ( Award No. 248 of 1991)
where the IC held that the Company has to establish the following 3 requirements in
order to justify the dismissal:
v. The Claimant was warned about his poor sales performances,
vi. The Claimant was given sufficient opportunities to improve and;
vii. Despite the warnings and opportunities given, the claimant failed to improve his
performance to the satisfaction of the Company.

In Lim Chu Chuan v Volubill Malaysia Sdn Bhd (2014) MELRU 1, a case in which
the employee was dismissed for failure to achieve the sales target, the Court held as
follows;
Even if there was poor performance, this Court finds that the Company's conduct as wanting as there was
no proof that the Claimant was ever warned of his poor performance, being counseled or given time to
improve his performance.

In this case, both COW1 and COW2 in their testimony confirmed that the Claimant did
12

not meet the sales target set by the Company. COW1 testified that the target set was
via 3 memos issued to him directly as appearing in pages 6, 7 and 8 of COB1.
However, upon my perusal of the above said memos, they are issued and addressed
to COW1 directly and not to the Claimant and they concern his sales target. Hence
why then should the Claimant be the only person to shoulder the responsibility of
meeting the sales target set by the Company. Furthermore, there was also no
evidence adduced before me that the Claimant was issued or ever issued a warning
letter due to her poor performance neither was there any evidence of any performance
appraisals communicated and discussed with the Claimant. There was also no
evidence as to how the Claimant was appraised or whether there was any appraisal at
all. No doubt, the Claimant never denied that she did not achieve the sales target set
by the Company but the Court is of the view that failure to meet the sales target should
not be shouldered by the Claimant alone. As stated by the Claimant, there were a lot
of shortfalls in the Sandakan Citi Club like for example the gym room and the pub
were still under renovation, the food supplied from the restaurant under the
supervision of the Claimant were not accounted as sales to the Claimant, that there
was shortage of manpower in the kitchen to cater for the demand of customers and
the Claimant was not able to increase the manpower as there are limited budget for
staffs recruitment, among others. This Court therefore accepts the contention by the
Claimant's counsel that the fault could not only be blamed on the Claimant alone.

Under these circumstances therefore, a performance appraisal is necessary to gauge

the Claimant's performance, without which the dismissal was arbitrary and hence not
bona fide. But all the Company said was she did not performed. The least that the
Company could have done was to discuss with her what are her shortcomings. After
all she is a long serving employee. However, this from the evidence adduced was
never done.

In the final analysis, based on the totality of evidence adduced by both parties as well
as submissions made and also having regards to equity and good conscience as well
13

as substantial merits of the case without regard to technicalities and legal form as
stated in s. 30(5) IRA, this court finds that the Claimants dismissal was without just
cause or excuse. The termination is now rendered unjust and unlawful. Accordingly,
the Claimants claim is hereby allowed. Hence I shall now examine the remedy.

Remedy

As the Claimant is now working, it is inappropriate to order the remedy of

reinstatement. Instead, the claimant will be awarded compensation under 2 heads
namely, back wages and compensation in lieu of reinstatement.

Back wages

Back wages is calculated based on the Claimants last drawn salary but limited to 24
months. See Court practice Note 1 of 1987. From the back wages, the court is
required to make a deduction for any contributory conduct; post dismissal earnings
and delay in the hearing of the case but such a deduction need not involve a
mathematical calculation. See Dr James Alfred (Sabah) v Koperasi Serbaguna
Sanya Sdn Bhd (Sabah) & Anor (2001) 3 CLJ 541.

a. Contributory Factor

I have carefully examined the facts and evidence in this case and I am of the view that
there is no contributory factor on the part of the Claimant in respect of the allegation
against her. Hence, under this item, no deduction shall be made.

b. Delay

From an examination of the notes of proceedings, I noticed that the Claimant did not
occasion any delay in connection with the hearing of this ministerial reference. Hence,
14

there is also no deduction down under this head.

c. Gainful employment

At the time of dismissal, the Claimants last drawn salary was RM6,426.00. On the
facts of this case, there is evidence adduced before me that she was unemployed for
3 months after she was dismissed by the Company. Hence, there is 20% scaling down
for post dismissal earnings.

In conclusion, I hereby hand down to the Claimant a monetary award in the total sum
of RM219,769.20 in lieu of reinstatement, which is arrived as follows:
a. Back wages from the date of dismissal (9 th September 2014) to the last date of
hearing (10th November 2016) but limited to 24 months.
RM6,426.00 x 24 = RM154,224.00 - 20%

RM123,379.20

b. Compensation of one months salary for each completed year of service. In this
case, the Claimant started working with the respondent Company from the 9th
September 1999 ie 15 years of service. (9th September 1999 to 9th September
2014).
RM6,426.00 x 15
c.

RM96,390.00

It is further ordered that the Company shall pay

the

total

amount of

RM219,769.20 to the Claimant subject to statutory deductions if any, through the

Claimants Solicitors firm of Messrs Goh & Associates within 30 days from the
date of this Award.
HANDED DOWN AND DATED THIS DAY OF 10TH NOVEMBER 2016.

-sgd(DUNCAN SIKODOL)
CHAIRMAN
INDUSTRIAL COURT MALAYSIA
SABAH
15