Questions about employment disputes in Malaysia: dismissal, unpaid wages, forced resignation, the Industrial Court and the Labour Court.
Wages must generally be paid within seven days after the end of each wage period. If your employer does not pay, you can file a claim at the nearest Labour Office (the Labour Court) under section 69 of the Employment Act 1955, free of charge. Bring your IC, appointment letter, payslips and any termination letter. Either side may appeal to the High Court within 14 days.
Constructive dismissal happens when an employer's conduct is a serious breach going to the root of the employment contract, and the employee leaves because of it. The test is contractual, not just unfairness. Write to the employer first, act promptly, and file a representation within 60 days of leaving under section 20 of the Industrial Relations Act 1967.
Under section 28 of the Contracts Act 1950, an agreement restraining someone from a lawful profession, trade or business is void to that extent, subject to narrow exceptions. So post-employment non-competes are often unenforceable. But confidentiality duties still apply, and a fair training bond may be recoverable as reasonable compensation under section 75.
The Industrial Court is less formal than the civil courts and decides cases according to equity, good conscience and the substantial merits, without regard to technicalities. But witnesses still give evidence on oath and are cross-examined. In dismissal cases the employer usually goes first, because it must justify the dismissal.
A Labour Court hearing is usually held at the Labour Office before a Labour Officer, and is less formal than a courtroom. You give evidence on oath, explain your claim, refer to your payslips and documents, and answer questions from the officer and the employer. Bring originals and copies, tell the truth, and keep to the facts.
A retrenchment is a dismissal. If you believe there was no genuine redundancy, or that you were unfairly selected, you can file written representations with the Director General of Industrial Relations within 60 days of the dismissal, or within 60 days after the notice period ends (IRA 1967, s.20(1),(1A)). If conciliation fails, the case may be referred to the Industrial Court (s.20(3)), which decides according to equity, good conscience and the substantial merits (s.30(5)). Backwages are capped at 24 months (Second Schedule).
Being on probation does not remove protection from unfair dismissal. A probationer who believes the dismissal was without just cause or excuse can file written representations with the Director General of Industrial Relations within 60 days (IRA 1967, s.20(1),(1A)). The Industrial Court will look at whether the employer genuinely assessed the probationer's suitability and acted in good faith. If the dismissal is found to be without just cause, backwages for a probationer are capped at 12 months (Second Schedule, para 2).
Under section 14 of the Employment Act 1955, an employer may, after due inquiry, dismiss without notice, downgrade or impose a lesser punishment on an employee for misconduct. Suspension without wages as a punishment cannot exceed two weeks; suspension pending the inquiry cannot exceed two weeks and the employee must be paid at least half wages, refunded if no misconduct is found (s.14(1),(2)). Prepare carefully: ask for the charge in writing, the documents, and time to respond. If you are dismissed, you can file representations under section 20 of the Industrial Relations Act 1967 within 60 days.
A genuine fixed-term contract ends when the period expires (Employment Act 1955, s.11(1)), so non-renewal is not ordinarily a dismissal. But the Industrial Court looks at substance, not labels. Where an employee has been kept on a series of "fixed-term" contracts to do permanent, ongoing work, or was given a legitimate expectation of renewal, non-renewal may be treated as a dismissal. If so, you can file representations within 60 days under section 20 of the Industrial Relations Act 1967, and the Court decides on equity and substantial merits (s.30(5)).
A person dissatisfied with an Industrial Court award under section 30 may appeal to the High Court within 14 days from receipt of the award (IRA 1967, s.33C(1)). The appeal follows the Rules of Court 2012 procedure for appeals from the Sessions Court, and the High Court has the same powers as on such an appeal (s.33C(2),(3)). An appeal does not by itself cancel the award. A money award carries interest at 8% a year, or a lower rate the Court directs, from the 31st day after the award until paid (s.30(1A)). Further appeals to the Court of Appeal are possible.
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