Whether the Appellant was the correct party to be sued [7] This issue pertains to the Appellant’s contention that Sri Maju is not the employer of all 36 Respondents, and consequently, Sri Maju is not the appropriate party to be sued by 25 out of the 36 Respondents. The Appellant argues that each Respondent should pursue claims against the S/N OcZahGqn1EuzdmrIvZ61mA specific company with which they individually contracted. The Industrial Court has acknowledged that Sri Maju, Aneka, Azra, and Germuda are part of the same corporate group, sharing common ownership. While recognising the separate legal identities of these entities, the Industrial Court also noted that the corporate veil might be lifted where the operational realities of the group warrant such an approach. [8] Citing the case of Pamol (Sabah) Ltd & Anor v Joseph bin Paulus Lantip & Ors [2012] 15 MLJ, the Appellant asserts that Sri Maju, Aneka, Azra, and Germuda are distinct legal entities with separate rights and liabilities. [9] The Appellant maintains that, absent specific statutory provisions or instances where the corporate veil is pierced due to misuse of the corporate structure for fraudulent or improper purposes, the separateness of these entities should be upheld. Accordingly, liabilities incurred by one company should not be automatically attributed to another within the group. [10] Furthermore, the Appellant argues that each employment contract clearly designates the specific employer, which is the only entity liable under the contract. The Appellant relies on a contractual clause stating, "I agree to work at such times and at such place as the management may think fit," contending that this clause does not alter the identity of the designated employer. Despite the companies operating as a group, each functions under separate contracts, thereby reinforcing their legal independence. S/N OcZahGqn1EuzdmrIvZ61mA [11] The Appellant submits that even if certain Respondents received their salaries from a different company than that named in their contracts, such payments were made purely for administrative convenience and do not signify a change in the employer. Evidence from SD1 (Pauline) supports the position that these transactions were merely procedural and should not affect the contractual relationships as defined by the respective employment agreements. [12] The Appellant contends that there is no evidence to suggest that the group of companies operated as a single integrated unit that would justify treating them as one employer. Without clear evidence of a unified operational structure overriding the individual corporate boundaries, the default position is to respect the separate legal identities of each company. [13] The principle that a company is a separate legal entity from its shareholders and other companies, even within the same group, is well-established in company law. This doctrine was firmly established in Salomon v. A Salomon & Co Ltd [1897] AC 22, where the House of Lords affirmed that upon incorporation, a company becomes a separate legal person distinct from its members. This principle underpins modern corporate law, allowing companies to own assets, incur liabilities, and enter into contracts independently of their shareholders or affiliated companies. [14] Nonetheless, the principle of separate legal entity is not absolute. Courts have recognised exceptions where the corporate veil may be pierced to prevent misuse of the corporate structure for fraudulent or improper purposes. The Federal Court, in Ong Leong Chiou & Anor v. S/N OcZahGqn1EuzdmrIvZ61mA Keller [2021] 4 CLJ 821, outlined circumstances in which the veil might be lifted:- “[1] The juristic principle comprising the bedrock of company law is the legal fiction that, on incorporation, the corporate entity is clothed with a separate and distinct personality. It is a legal person distinct from its members (Salomon v. A Salomon & Co Ltd [1897] AC 22 (‘Salomon v. Salomon’)). There subsists a ‘veil’ between the company and its members that separates them for purposes of liability, property, capacity, and in relation to acts done or the acquisition of rights. The natural persons who are the incorporators are ignored. [2] However, the veil of incorporation is not entirely inviolable. One of the well-recognised and accepted exceptions to the principle of the separate personality of a company is where the legal entity of a corporate body is utilised for fraudulent, dishonest or unlawful purposes. Those seeds of limitation were set out in the locus classicus of Salomon v. Salomon (above) itself by Lord Davey: If … the company was formed for an unlawful purpose, or in order to achieve an object not permitted by the provisions of the [Companies] Act, the appropriate remedy (if any) would seem to be to S/N OcZahGqn1EuzdmrIvZ61mA set aside the certificate of incorporation, or to treat the company as a nullity, or, if the appellant has committed a fraud or misdemeanour … he may be proceeded against civilly or criminally … In such circumstances, the person or persons perpetrating such abuse cannot hide behind the separate corporate personality. The courts will “break” the shell of incorporation, by utilising the doctrine of the “lifting or piercing of the corporate veil”. Our law journals are replete with case law on this subject.” [15] Justice Nallini Pathmanathan, in the above case, observed that the corporate veil may be lifted where it is shown that the company is being used as a façade to conceal true facts, commit fraud, or evade legal obligations. The burden of proof rests on the party seeking to lift the veil to demonstrate clear evidence of such improper use. [16] The issue of whether group companies can be treated as a single entity for legal purposes has been examined in cases such as Hotel Jaya Puri Bhd v. National Union of Hotel Bar & Restaurant Workers & Anor [1980] 1 MLJ 109 where Salleh Abas FJ (as he then was) stated as follows:- “It is true that while the principle that a company is an entity separate from its shareholders and that a subsidiary and its parent or holding company are separate entities having separate existence is well S/N OcZahGqn1EuzdmrIvZ61mA established in company law, in recent years the court has, in a number of cases, by-passed this principle if not made an inroad into it. The court seems quite willing to lift “the veil of incorporation” (so the expression goes) when the justice of the case so demands. Thus the facts of the case may well justify the court to hold that despite separate existence a subsidiary company is an agent of the parent company or vice versa as was decided in Smith, Stone and Knight v. Birmingham Corporation; Re F.G. (Films) Limited; and Firestone Tyre & Rubber Co. v. Llewelyn, Professor Gower in his Principles of Modern Company Law, 3rd Edition, Page 213, said that the courts “are coming to recognise the essential unity of a group enterprise rather than the separate legal entity of each company within the group. Other examples of this can be found. In The Roberta (1937) 58 LJ. L.R. 159, a parent company was held liable on a bill of lading signed on behalf of its wholly owned subsidiary, the court saying that the subsidiary was ‘a separate entity … in name alone and probably for the purposes of taxation’. In another case, Spittle v. Thames Grit & Aggregates Ltd. [1937] 4 All E.R. 101, the court found no difficulty in treating a subsidiary as ‘to all intents and purposes’ the same as the parent company which held 90 per cent of its shares. A licensing authority in exercise of its discretion has S/N OcZahGqn1EuzdmrIvZ61mA been held entitled to have regard to the fact that a parent and subsidiary company, though technically separate legal persons, in fact constituted a single commercial unit (Merchandise Transport Ltd. V. British Transport Commission [1962] 2 Q.B. 173, Devlin LJ. At page 202) … A good example of this is Bird & Co. v. Thos. Cook & Son [1937] 2 All E.R. 227, in which an indorsement of a cheque to ‘Thos. Cook & Son Ltd.’ was treated as an indorsement to the allied but separate company of Thos. Cook & Son (Bankers) Ltd. Regarding it as a mere misdescription to be ignored under the principle falsa demonstratio non nocet.” It is clear therefore that the approach taken by the President of Industrial Court is not without any legal support when he placed an emphasis on the essential unity of group enterprise which in this case consists of the Hotel and the Restaurant, especially when Datuk N.A. Kularajah who is the Managing Director of the Hotel was also the Managing Director and later a Director of the Restaurant and had the ultimate authority over the employees. Thus, the practice of treating the employees of the Restaurant as being separate from the employees of the Hotel such as the Union having been told that they were so, their salaries, their E.P.F. and SOCSO contributions being paid by the Restaurant, does not detract from the fact that the employees in question were in fact S/N OcZahGqn1EuzdmrIvZ61mA working in one group enterprise. In my judgment, by giving recognition to this fact, the President did not cause any violence to the sanctity of the principle of separate entity established in Salomon v. Salomon & Co. but rather gave effect to the reality of the Hotel and the Restaurant as being in one enterprise. I find nothing unreasonable in the finding of the President by by-passing this principle.” [17] Similarly, in Sunrise Sdn Bhd v. First Profile (M) Sdn Bhd & Anor [1996] 3 MLJ 533, the Court acknowledged that while the principle of corporate personality is fundamental, it is not inviolable. Courts have intervened to pierce the corporate veil when companies are used to evade contractual obligations or perpetrate injustices. [18] In the present case, the central issue is whether Sri Maju, Aneka, Azra, and Germuda, despite being separate legal entities, should be treated as a single employer for the purposes of this legal action. The Appellant argues that there is no statutory or common law basis to deviate from the principle of separate legal entities. They assert that each Respondent's employer is clearly defined in their respective contracts, and payments made by other group companies are merely administrative conveniences that do not alter the contractual relationships. [19] To determine whether Sri Maju is the correct employer of all 36 Respondents, the court must consider not only the formal contracts but also the operational and managerial realities of the group. S/N OcZahGqn1EuzdmrIvZ61mA [20] Evidence indicates that Sri Maju, Aneka, Azra, and Germuda are managed under a unified leadership and operate with a cohesive management structure. Testimony from SD5 confirms that these companies function as an integrated unit, blurring the lines between the formal legal separations of the entities. This unified management supports the view that Sri Maju effectively functions as the employer of all Respondents. [21] The use of the Sri Maju logo on uniforms and vehicles reinforces the perception that employees are working for a single employer. This common branding reflects the integrated nature of the group's operations and supports the Respondents' claim that they are employed by Sri Maju, regardless of the company name on their individual contracts. [22] Pay slips issued by Sri Maju to employees contracted with other group companies further illustrate the operational reality that Sri Maju oversees employment matters across the group. This cross-company administration of payroll substantiates the argument that Sri Maju acts as the principal employer, managing and overseeing employment conditions for all workers within the group. [23] The evidence demonstrates that Sri Maju, Aneka, Azra, and Germuda are not merely separate legal entities operating independently but function as a unified enterprise with shared resources, branding, and administration. [24] The issuance of pay slips by Sri Maju to employees of other group companies, combined with the use of the Sri Maju brand, highlights the integrated nature of their operations. This evidence indicates that the S/N OcZahGqn1EuzdmrIvZ61mA companies operate without meaningful distinction in their day-to-day functions, effectively making Sri Maju the de facto employer. [25] The Respondents have successfully met the burden of proof, showing that Sri Maju and its related companies operate as a single economic entity. The operational integration, common branding, and unified management substantiate the Respondents' claim that Sri Maju is their true employer. This justifies lifting the corporate veil to prevent injustice and reflect the true nature of the employment relationships. [26] The principle established in Ong Leong Chiou provides a sound legal basis for treating Sri Maju as the employer, as failing to do so would permit the companies to unjustly shield themselves behind the facade of corporate separateness, to the detriment of the Respondents. [27] The Court finds that Sri Maju, Aneka, Azra, and Germuda operate as a single enterprise with integrated management and operations. Accordingly, Sri Maju is properly considered the employer of all 36 Respondents.