Employee Relations - Termination
Can an employer require an employee who tenders notice of resignation to leave the company immediately?
Yes, however the employer must pay the employee wages in lieu of the balance of the notice period.
My termination notice is 3 months and I have 2 weeks of annual leave left. Can the Company force me to leave immediately (within a week) and force me to compensate (pay the Company 2.5 months' salary) them for leaving early?
Your notice of termination would be 3 months or payment of 3 months wages in lieu of termination notice. If the Company wishes you to leave immediately, then the Company needs to pay you the payment in lieu of notice. You do not have to pay the Company any payment in lieu of notice, as you do not leave early, instead it was the Company that want you to leave early and as such the Company has to pay you in lieu of the remaining notice period.
Can a company use the services of outsiders to conduct domestic inquiry?/strong>
Domestic inquiry is an internal matter and should as far as possible be handled by employees of the Company. However, if all the employees of the company have prior knowledge of the case, company may use the services of the company's Board of Directors and outsiders to hold a domestic inquiry.
Is an employee entitled to payment in lieu of annual leave not taken at the time of termination of service?
The employee who resigns from service or whose service is terminated otherwise than for misconduct is entitled to paid annual leave in direct proportion to the completed months of service during the year in which termination takes place and the employer shall pay the annual leave wages in respect of the balance of annual leave.
How long is the notice period required for either party to terminate the contract of service?
General guidelines for disciplinary action are as follows:
Can a termination be effected without notice by either the employer or employee?
What is the recourse or action for an employer, in the event he finds his employee commits misconduct that goes against the conditions of contract?
After due investigation and after finding the act/s tantamount to misconduct that goes against the conditions of contract, either express or implied terms, the employer may:
For the purpose of investigation, an employer may suspense his employee for the maximum period of 2 weeks. Full wages shall be reimbursed to the employee once he is exonerated.
What is the regulation made pursuant to the Act that provides the entitlement to termination/lay-off benefits?
The Employment (Termination and Lay-off Benefits) Regulations 1980.
When a Frustration of Contract does occur?
Under what circumstances can an employer dismiss a probationer?
Can an employee be suspended while an investigation is being carried out?
How many types of suspension specified under the Employment Act?
Can an employee be forced to resign?
Can an employer dismiss an employee under poor performance?
What is meant by 'Last In, First Out"?
Mr. Chan with 5 years' service was being retrenched with effect from 1 April 2014. How to determine the termination benefits that he is entitled?
Basic Pay, All Allowances, Overtime Earnings but excluding travelling allowance and reimbursement. Hence, his wage for the preceding twelve months was as follows:
The Average True Day's Wage is RM 12,150 / 365 = RM33.29
(12 month's salary / 365) x Years of Service x Days of Entitlement of Each Year
= RM33.29 x 5 x 20
I am not a Malaysian citizen but I am employed by a Malaysian company. Do I have any recourse for unfair dismissal under the Malaysian Industrial Relations Act?
Yes. The right to file a representation under the Industrial Relations Act is available to all employees in Malaysia and is not limited to Malaysian citizens.
What is the difference between the Industrial Court and the Labour Court?
Industrial Court deals with individual disputes arising from the employer-employee relationship (such as dismissals) and trade disputes between trade unions and employers (such as transfers, collective agreements) and breaches of rights and obligations imposed under the Industrial Relations Act 1967; whilst Labour Court deals mainly with recovery of wages and other monies and employment benefits provided to employees under the Employment Act 1955 such as overtime pay, maternity allowance, salary in lieu of notice of termination and termination benefits. The "Labour Court" is not a statutory tribunal like the Industrial Court but refers to the hearing conducted by a Labour Officer of the Labour Department into complaints by employees. Employees whose monthly wages are RM2,000 and below and other categories of employees who are entitled to the benefits in the Employment Act 1955 can file their claims in the Labour Court. Employees who fall outside the scope of the Employment Act 1955 but whose monthly salary does not exceed RM5,000 may also seek the assistance of the Labour Court for recovery of salary or other monies due and payable by their employers under their individual contracts of service.
Can dismissal cases be settled "Out of Court"?
Yes, dismissal cases be settled "Out of Court". Many employers negotiate a settlement with the employee claiming unfair dismissal before the date of hearing. The Court welcomes such settlements as much time is saved. They need to be presented to the Court and once accepted by the Claimant become awards and enforceable like any decision made by the Court itself.
Why do employers frequently lose their cases at the Industrial Court?
There are many reasons why employers lose their cases at the Industrial Court. Three major causes of workers either being reinstated or compensated can be discerned. They are:
My employment contract says that either party may terminate the contract by providing 1 months' notice in writing or by making payment in lieu of notice. Does this mean that my employer can terminate my contract for any reason as long as he gives me 1 months' notice or payment in lieu?
Despite the notice clause in your contract, your employer is still required to show "just cause and excuse" before terminating your contract of employment. This means they must show good grounds for the termination and cannot merely rely on the notice clause to terminate the employment. Termination by an employer based solely on the notice clause could result in an employer facing a claim for unfair dismissal. Please note that the requirement to show "just cause and excuse" only applies to the employer – an employee can terminate their employment/resign from employment for any reason by following the notice clause.
What sort of remedy or damages can I get if I win my case at the Industrial Court?
The Industrial Court will usually award back wages (capped at 24 months of the last drawn salary for confirmed employees, and 12 months for probationers) and reinstatement. In the event reinstatement is not feasible (which is usually the case since the employer-employee relationship may have broken down by the time the matter goes to trial), the Industrial Court may also award compensation in lieu of reinstatement. There is no fixed formula for how much will be awarded as compensation in lieu of reinstatement, but the usual practice is one month's salary for every year of service. This sum is still subject to reduction at the discretion of the Court depending on the circumstances such as the employee's conduct and whether they are already gainfully employed.
What steps can be taken by the employer to prevent termination of employees?
When a redundancy situation arises, the employer must first take the necessary measures to avoid workers termination as proposed by the Procedure for Industrial Harmony, namely: -
1. Freeze new recruitment except for critical areas;
2. Limit overtime;
3. Limit work on weekly rest day and public holidays;
4. Reduce weekly working days or reduce the number of shift job;
5. Reduce daily working hours;
6. Conduct retraining programmes for workers;
7. Identify alternative work and transfer to other division / work within the same company;
8. Implement temporary layoff, for example in the form of temporary shutdown by offering a reasonable salary and help workers obtain temporary work elsewhere until operations can be resumed. If employers implement temporary layoffs, the information regarding the period of layoff must be reported to the Labour Department Peninsular Malaysia (JTKSM) for the purpose of monitoring whether the employee is reinstated or offered Voluntary Separation Scheme (VSS) or permanently terminated in future; and
9. Reduce employee's wages (Pay-Cut) which is made fairly at all levels can also be implemented as a last resort, after other cost saving measures has been implemented.
Is it true that probationers are not entitled to termination benefits?
As far as the law is concerned, it does not distinguish between probationers and confirmed staff. As long as the employee has served at least 12 months, the employer becomes liable to pay if the employee does not fall into any of the exclusion provisions.