Majupadu Development Sdn Bhd v Kong Kiek Ching (JA-16A-2-09/2024)

This was an appeal from the Industrial Court relating to the decision by the Industrial Court Chairman in not allowing the application by the Company/Appellant to recall its witness for the purpose of introducing a piece of evidence relating to fraud and embezzlement of money not mentioned in the show cause letter framed against the Respondent.

After hearing arguments from both counsel, and upon carefully perusing the Records of Appeal including the Grounds of Judgment prepared by the Chairman, this Court allowed this appeal with costs. Consequential thereto, it was also ordered that the Chairman shall allow the Company to bring in the evidence and to proceed therefrom with the hearing of the Claimant’s claim in full. Salient facts

Vide a letter dated 08.12.2021, the Company terminated the Claimant’s employment.

As a result, the Claimant filed a claim for unlawful dismissal against the Company in the Industrial Court.

The trial at the Industrial Court began on 24.11.2023. S/N gbelrUQ6g0Gm3F2auqYTQ

The Company’s 1st witness (COW-1) gave evidence by tendering a witness statement and a supplementary witness statement, which were marked as CO-WS 1 (A) and CO-WS 1 (B) respectively.

The cross-examination of COW-1 was reserved. The trial was then adjourned to September 2024.

When the trial resumed on 10.09.2024, COW-1 was absent due to medical reasons. The Company then proceeded to call COW-2 and COW-3 to give their evidence.

COW-3 tendered a witness statement and a supplementary witness statement, which were marked as CO-WS 3 (A) and CO-WS 3 (B) respectively.

The Claimant then raised an objection, requesting that the parts of CO-WS 3(A) which contained an accusation that the Respondent had committed fraud and embezzlement of money which had caused loss of RM200,000.00 to the Company be expunged from the Industrial Court’s record (“Preliminary Objection”).

The basis for the Preliminary Objection was that such accusation of fraud and embezzlement of money was not among the charges stated in the show-cause letter dated 24.11.2021 issued by the Company to the Respondent. In other words, those fraud and embezzlement were not part of the charge against the Claimant in the show cause letter. S/N gbelrUQ6g0Gm3F2auqYTQ

The Industrial Court allowed the Preliminary Objection, hence this appeal.

In allowing the appeal, this Court firstly finds that the charge (show cause letter) was dated 24.11.2021.

The termination letter was dated 08.12.2021.

According to COW-1 and COW-3’s testimony, the Company had only come to discover about the fraud and embezzlement on 01.12.2021.

Thus, the said discovery was obtained before the termination date. From the evidence, the said discovery had been taken into the mind of the Company as the employer, prior to the decision to dismiss the Claimant.

In this regard, this Court agrees with the submission by the Company’s counsel that the evidence relating to the said discovery was wrongly expunged by the learned Industrial Court Chairman.

That such evidence ought not to have been expunged because they are very much relevant for the purpose of determining the appropriate relief under Second Schedule of the Industrial Relations Act 1967, which are worded as follows:- S/N gbelrUQ6g0Gm3F2auqYTQ “Second Schedule: Factors For Consideration In Making An Award In Relation To A Reference Under Subsection 20 (3) Factors For Consideration In Making An Award In Relation To A Reference Under Subsection 20 (3) …

Any relief given shall take into account contributory misconduct of the workman.”

In Maritime Intelligence Sdn Bhd v. Tan Ah Gek [2021] 10 CLJ 663 the Federal Court held that:- “[46] … The focus of the enquiry of the Industrial Court under section 20(3) of the Act, is therefore premised on matters and events as they occurred at the time of the dismissal. The reasons operating in the mind of the employer, which preceded the decision to terminate, and resulted in the decision to terminate, comprise the matters to be considered and adjudicated upon by the Industrial Court under section 20(3). … [53] Any such ‘just cause or excuse’ can only refer to the reason resonating in the employer’s mind, prior to, or preceding the decision to dismiss. Those words do not envisage the investigation or contemplation of matters or reasons that the employer discovers subsequently or which operate on the employer’s mind post-dismissal. [54] These subsequent matters may well go to the issue of the moulding of the relevant relief such as contributory conduct, or comprise basis to refuse reinstatement and reduce or refuse compensation in lieu. But such subsequent and fresh evidence cannot be utilised retrospectively to justify a termination which was not effected for those reasons or on that basis. It is reiterated that this is because such ‘cause’ did not operate on the employer’s mind at the material time. S/N gbelrUQ6g0Gm3F2auqYTQ [55] Therefore both a literal and purposive statutory construction of section 20 does not envisage the employer seeking to justify the termination utilising post-dismissal reasons.”

My understanding of Maritime is clear, if the contentious evidence concerns something post termination, then it is inadmissible. But if it is otherwise, i.e. pre-termination then they should be allowed to be admitted as evidence. The rationale to that can be found from the Federal Court’s decision in the following paragraph: - “[92] … It follows that such evidence must be evidence which was evident and operational on the employer’s mind immediately prior to, or at the time of dismissal. It cannot refer to evidence which arose in the employer’s mind subsequently because those factors did not make the employer reach the decision that the workman’s services ought to be terminated. … And the ambit of that jurisdiction is to ascertain the matters or factors determinative of the decision to dismissal, resulting in the dismissal, and not matters which have occurred subsequently to the employer in an effort to justify the dismissal ex post facto.”

The position may have been otherwise if the evidence obtained by the Company is shown to have occurred post termination.Thus for the reasons as stated above, I allowed the appeal with costs of RM3,000.00 (subject to payment of allocator fee). Dated: 31.03.2026 sgd …………………………………….. Noor Hisham Bin Ismail Judge Johor Bahru High Court S/N gbelrUQ6g0Gm3F2auqYTQ For the Appellant : Messrs. Ai Nin Tan & Partners 26-3, Jalan PJU 5/9, Dataran Sunway Kota Damansara 47810 Petaling Jaya, Selangor. For the Respondent : Messrs V. M. Muthu & Co No. 46, First Floor, Jalan Permas 10 Bandar Baru Permas Jaya 81750 Masai, Johor S/N gbelrUQ6g0Gm3F2auqYTQ