Award of Transfer cases - Industrial Court Malaysia

7/29/2019 Award of Transfer cases - Industrial Court Malaysia

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[2013] 1 LNS 412 Legal Network Series

DALAM MAHKAMAH TINGGI MALAYA DI PULAU PINANG

[PERMOHONAN BAGI SEMAKAN KEHAKIMAN NO: 25-42-03-2012]

Dalam perkara berkenaan dengan Award

Mahkamah Perusahaan No. 87 Tahun 2012

bertarikh 12.1.2012 yang diterima pada

25.1.2012

Dan

Dalam permohonan suatu permohonan

Untuk Perintah Certiorari

Dan

Dalam perkara berkenaan Aturan 53,

Kaedah-Kaedah Mahkamah Tinggi 1980.

ANTARA

NESTLE PRODUCTS SDN BHD PEMOHON

DAN

1. MAHKAMAH PERUSAHAAN

MALAYSIA ...RESPONDEN-

2. MEERA HUSSAIN P.M. RESPONDEN

SHAHUL HAMID

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JUDGMENT

This Applicat ion for judicial review is in respect of the Award

handed down by the 1 s t respondent (R1) in relat ion to the dispute

between the Applicant and the 2 n d respondent (R2) on the i ssue of

R2's dismissal by the Applicant.

Brief factual matrix

By a le t ter dated 30.11.2004, R2 who was holding the posi t ion

of Sales Representat ive Gradel , was t ransferred from the Applicant 's

Penang Branch to Kuantan Branch , Sa les Div i s ion based in Kuala

Te re n gg a nu w it h e ff e ct f r om 1 .1 .2 0 05 . R 2 h ow e ve r, s ub m it te d

severa l appea l l e tt e rs appea ling against the t ransfer order, c i ting

amongst o ther s, h is med ical condi ti on . The App li cant had dul y

responded to a l l of R2 's appeals explaining to him that the t ransfer

has come about to provide oppor tuni ty for exposure and

development . Furthermore , the Appli can t has expla ined tha t with

R2's cont r ibut ion over the years , the Appl icant bel ieves that he has

the potent ial for further growth and the experience and capabil i ty to

a dd v alu e in th e E ast Co as t ar ea . With r eg ar d to h is me dic al

condit ion, the Applicant a l so c lar if ied that the pace of l i fe in Kuala

Terengganu i s modera te and t ha t any med ical care and ongoi ng

medicat ion, i f needed, is avai lable throughout the country and in the

East Coast.

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Due to R2's fai lure to report for duty on 3.1.2005 and later on5.1.2005, he was required to at tend a Domest ic Inquiry on 20.1.2005

to answer 2 changes leveled against him:

Charge 1:

Th a t yo u h a ve o n 3 r d and 5 t h January 2005 in fa i l ing to comply wi th the

C om p an y 's l a wf u l i n st r uc t io n t o p ro c ee d o n t r an s fe r, c o mm i tt e d a n a c t o f

insubordination.

Charge 2:

Th a t yo u h a ve in th e co u rse o f a t t emp t in g to a vo id th e

t r a n s f e r a b u s e d t h e G r i e v a n ce P ro c e d u re p r oc e s s a s c o n t a i n e d i n A r t i c l e 9

o f the NPC/NUCW 2001-2003 Col lec t ive Agreement (which i s now superseded

b y t he N PC / NU CW 2 00 4 - 2 00 6 C ol le c ti v e A gr ee m en t w hi c h i s p en di n g

cogni t ion by the Industr ia l Court .

The panel o f t he Domes ti c Inqui ry found R2 gui lt y o f bot h

charges. R2 was however given another chance to report for duty on

2.2.2005 despite the finding of guilty by the panel of Domestic Inquiry.

R2 fa il ed t o r epor t fo r du t y on 2 . 2. 2005 and h i s employmen t

w as s ub s eq ue n tl y t er m in at ed b y t he A pp li ca n t b y a l et te r d a te d2 .2 .2 05 o n t he gr ou nd o f i ns ub or di na ti on a nd t ha t h is a ct i on

const i tutes a repudiatory breach of his cont ract of employment .

The Award Of R1

In the Award, R1 held that the dismissal of R2 on account of his

r e f u s a l t o g o o n t r a n s f e r f r o m t h e P e n a n g B r a n c h t o t h e K u a n t a n

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Branch to the based in Kuala Terengganu was without just cause or

excuse

R1 proceeded to award monetary compensat ion in the sum of

RM132,840.40 as follow:

(a) Backwages from the date of dismissa l t o the la st date of

hear ing in the sum of RM53,390.40 (RM3,178.800 x 24

with a deducat ion of 30%); and

(b) Compensation in l ieu of re ins ta t ement (one month sa la ry

f or e ac h c om pl et ed y ea r o f s er vi ce f ro m 2 .6 .1 98 0 t il l

2.2.2005) in the sum of RM79,450 (RM3,178.00 x 25).

However, in arriving at the Award of compensat ion the learned

Cha i rman o f R1 deduca t ed 30% of t he back wages on accoun t o f

'misconduct ' of R2.

The Law

It is t r i te law that the High Court wil l quash the decision of the

Industrial Court if in the course of coming to its decision the Industrial

Court has commited an error of law, when i t committed proceduralimpropriety, illegality or irrationality: Booi Kim Lee v. Menteri Sumber

Manusia, Malaysia & Anor [1999] 4 CLJ 121.

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Findings of fac t s based pure ly on the c red ib i l i ty ' s o f wi tness

may not be chal lenged in judicia l revies; however , i t i s es tabl i shed

law that :

i . rel iance upon erroneous fac tual conclus ion; or

i i. conclusion which are not supported by evidences;

i ii . decis ion i s not supported by facts ; or

iv. the findings have been r eached by talking into account

irrelevant consideration, or

v. not taking account rel evant considera tion ,

are subject to judicial review: Ranjit Kaur S Gopal Singh v. Hotal

Excelsior (M) Sdn. Bhd [2010] 8 CLJ 629.

The law on the transfer of a workman is well settled:

i . Tr ans fe r of a wor ke r is a mana ger ia l p rer og at ive w hich

c an b e e xc ut e d b on a f id e i n t h e i n t e re s t o f t h e

e m p l y e r ' s b u s i n e s s :

L a d a n g H o l y ro o d v. Ay a s a m y M a n i k a m & O r s [ 2 0 0 4 ] 2

C L J 6 9 7 ;

Ikedal I.O.M. Holding (M) Sdn. Bhd v. Gan Poh Jin [1995]

1 ILR 297;

Saiful Bahari Abdul Rashid v. Menara Kuala Lumpur Sdn.

Bhd [2012] 2 LNS 0324.

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i i . Manageria l p reroga t ive to t ransfer, pr ima fac ie val id

unless vi t iated by proof of mala f ide . The burden of proof

l ies on the workman alleging victimization:

S h a n k e r K a n a v e l v . S u n M e d i a C o r p o r a t i o n [ 2 0 0 3 ] 3

ILR 141 ; Harianto Effendy Zakaria & Ors v. Mahkamah

Per u s ah a an M al a ys i a & Ano r [ 20 11 ] 5 CLJ 18 8 ;

Balakrishnan a/l Krishnasamy v. Wes tern Digital (M) Sdn.

Bhd & Anor [1999] MLJU 437.

ii i. The burden of proof on the allegation of mala fide lies on the

workman alleging victimization etc,:

Shanker Kanavel (supra);

Harianto Effendy Zakaria & Ors (supra);

Balakrishnan a/l Krishnasamy (supra).

iv. Nature and quality of proof of victimization required positive

proof on balance of probabilities: Ranjit Kaur S Gopal Singh

(supra). It must be proved that the order of transfer was mala

fide or was a measure of vic timization or unfai r labour

practice. There should be concrete materials which should be

unimpeachable in character. Shanker Kanavel (supra).

v. Willful refusal to proceed on transfer instruction is

insubordination which warrant dismissal:

Pan Global - Textiles Bhd Pulau Pinang v. Ang Bong Teik

[2002] 1 CLJ 181;

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Chan Sow Lan v. Jurutera Konsultant (Semenanjung) Sdn.

Bhd [2011] 2 LNS 1563;

TN Machinery & Equipment (KL) Sdn. Bhd & Ors v. Choong

Loong Wun [2011] 2 LNS 1600;

Chinniah Sundram v. Pioneer Sun-Mix (SMC) Sdn. Bhd [2009]

2 LNS 1293.

v i. Transfe r can be e ffected so l ong a s t here i s no change to

terms and conditions of service:

Shahabudin Abdul Rashid v. Talasco Insurance Sdn. Bhd [2004]

4 CLJ 514;

Selvarani M. Narayanasamy v. Nittsu Transport Services (M)

Sdn. Bhd[2009] 4 ILR 524.

vii. The nature of the disadvantage or detriment would impugn a

transfer directive must pertain to the terms and conditions of

e mp lo yme nt o f a tr an sf er re d e mp lo ye e a nd t o m at te rs

w h ic h a ff ec t t he p r ef er en ce o r t he w is he s o f t he

employee. Entai led inconvenience is a normal consequenceo f a ny r el oc at io n a s l on g a s n o p ro of o f mala f ide or

improper motive: Loh Siew Kim v. Menteri Sumber Manusia,

Malaysia & Anor [2010] 1 LNS 558.

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vii i. Appeal aga inst t ransfer do not excuse an employee f rom

complying with the transfer order:

Malaysia Airports Bhd v Abdillah Bujang & Anor [2000] 2 ILR

65;

Tenaga Insurance Bhd v. Chea Lee Sang [2002] 1 ILR 154.

ix. No obligation or requirement on the part of the employer to

consult with employee prior to a transfer:

Afizah Yaakob v. Cosmopoint Sdn. Bhd[2009] 3 ILR 653;

George Town Holdings Bhd v. Chan Wang Tak [1997] 3 ILR

935.

Findings

Based on the above l aw s ta ted, I wil l now del iberate on the

judgment of Rl.

I t i s R 2 ' s c a s e t h a t h i s t r a n s f e r w a s d o n e i n b a d f a i t h w a s

premised on paragraph 26 of the Statement of Case which s ta tes as

fol lows:

The Claimant (R2 herein) contends and avers that the Company

was motivated by malice and its action was mala fide when decided to

transfer contrary to the terms of employment without at all discussing

with/consulting him. The Claimant too contends that the Company was

unhappy with the Claimant's active involvement in trade union activities

during his tenure in Penang (page 5 of the Applicant's Affidavit).

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In h i s w i t ness s t a t emen t R2 made no re fe rence a t a l l t o any

al leged vict imizat ion due to his union act ivi t ies.

The only purported evidence of mala fide due to victimization is

R2's bare assert ion of the Applicant's unhappiness with him for being

a v oc al n eg otia tio n an d hi s p er cep ti on o f h is s upe rior 's b od y

l an g ua ge . T he r e i s a ls o t h e r e fe r en ce t o s o me u n na me d s ta ff t o

whom COW 2 purpor ted ly ment ioned tha t R2 was championing the

workers r igh t . However th i s a l l eged s t a t ement of COW 2 was never

put to COW 2 in the c ross-examinat ion .

T h e s e a r e m e r e l y b a r e a s s e r t i o n s w h i c h d o n o t c o u n t a s

p r o b a t i v e e v i d e n c e t o c o n s t i t u t e p r o o f o f m a l a f i d e .

T he A pp li ca nt o n t he o th er h an d h ad p ro du ce d e vi de nc e

t hr ou gh C OW 1 a nd C OW 3 t ha t t he t ra ns fe r w as f or g en ui ne

b u s i n e s s r e a s o n s , i e , t h e K u a n t a n B r a n c h w a s e x p a n d i n g a n d

n e e d e d a n e xp er ie nc e p er so n t o h an dl e a nd m an ag e th e s ai d

e x p a n s i o n . R 2 w a s r e c o m m e n d e d b y t h e P e n a n g B r a n c h M a n a g e r

as he was of the op in ion tha t R2 had the necessary exper ience and

he was a good perfor mer. These tes t imonies were never chal lenged .

R2' s case of v ic timiza tion was never put to the Appli cant 's

witnesses I t i s essential that a par tly case be expressly put to the

opponent material witnesses when they are under cross-examinat ion:

Aik Ming (M) Sdn. Bhd & 7 Ors v. Chang Ching Chuen & 3 Ors &

Another Case [1995] 3 CLJ 639.

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The above evidence adduced by the Applicant dur ing thep r o c e e d i n g s b e f o r e . R 1 s h o w s t h a t t h e r e w a s i n d e e d a n e e d t o

t r a n s f e r R 2 t o t h e K u a n t a n b r a n c h f o r t h e n e e d t o u t i l i z e R 2 ' s

exper ience and deve lop the sa id branch . The t ransfer was for bona

f ide reason .

R1 clearly had not taken into account the reasons given by the

Applicants and to properly evaluate the same and the fl imsy evidenceof R2 before a rr iv ing a t t he unsubst an ti at ed concl us ion t ha t t he

transfer was not bona f ide . R1's decision is clearly flawed.

R2 also al leges that the Applicant was motivated by malice and

i t s act ion was mala f ide when i t decided to t ransfer him cont rary to

t he t er m o f e mp lo yme nt w it ho ut a t a ll d is cu ss in g w it h h im o r

consul t ing him.

I am of the view that there i s no obl igat ion on the par t of an

employer to consult an employee prior to transfer him. It is noted that

R 1 d id n ot ma ke a ny a dv er se f in di ng o n t hi s i ss ue a ga in st t he

Appl ican t , i n h i s Award . Clear ly therefore , R2 has fa i l ed to prove

mala f ide on this al leged ground.

R1 also held that R2 did not out r ight ly refuse to go on t ransfer but was sti l l appealing to the Applicant to reconsider i ts decision.

Clearly, R1 had taken into account irrelevant consideration.

Whi le an employee who was dissat i sf ied wi th a t ransfer order

may lodge appeal , such act ion does not in i t se l f negate the t ransfer

order and excuse the employee from complying with the order.

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The Applicant had considered the appeal and decided R2 had togo on t ransfer . R2 i s therefore obl iged to comply wi th the t ransfer

order.

R2's failure to comply with the Applicant 's transfer order and his

refusal, was a wilful disobedience to a lawful and reasonable order.

R1 also held that the t ransfer of R2 was a detriment to his term

of employment. R1 held that R2 was referred to as Sales

Representa t ive , a grade be low the pos i t ion of Key Account s Sa les

Representat ive (KASR), his posi t ion prior to the t ransfer.

During the trial , evidence was adduced through COW 3 to show

that there was no change to the condi t ions of employment as can be

seen at Q & A No: 21 at page 86 of the appl icant 's affidavi t .

Q: Wa s the C la iman t' s p os it io n on t ran sfer to the Kua ntan b ran ch a s a

Sales Representat ive Grade 1 a demotion from his posi t ion at the

Penang branch as Key Accounts Sales Representative?

A : N o , i t w a s n o t . E s s e n t i a l l y , a K e y A c c o u n t s S a l e s

Re p re s en ta t i v e i s a S a le s Re p re s en ta t i v e . In b o th b r a nc h es , th e

Cla imant was a Grade I Sa les Represen ta t ive , tha t being the case

the Claimant would st i l l be in the same Grade and enjoy the same

salary and benefits .

Even the terms in the t ransfer le t ter s ta tes that R2 ' to assume

t he same pos i t i on o f Sa l e s Represen t a t i ve Grade 1 ' - ( s e e l e t t e r

dated 30.11.2000 at page 106 of the Appl icant ' s aff idavi t ) .

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No evidence was adduced before R1 to indicate that SalesRe pr es en ta ti ve Gr ad e 1 wa s a gr ad e b elo w KAS R. I n f ac t, R2

admit ted during cross-examinat ion that none in his appeal let ters did

he men t i on t ha t he was demot ed o r t r ans fe r red t o a g rade be l ow.

Clearly this an afterthought on the part of R2. Evident ly R1 has taken

in to account i rre levant cons iderat ions in decid ing that the ac t o f

t ransferring R2 was mala fide .

The reasons of appeal by R2 ie, h is personal problem, family

reason and heal th reason to reconsider the t ransfer were personal in

na ture and are matt e rs which the Appl i can t had addressed . These

reasons had nothing to do with his ter ms and conditions of

employment with the Applicant .

R1's finding that the transfer was a detriment to R2's terms and

conditions of employment is, without basis.

I t i s inevi t ab le tha t some inconvenience may be caused when

one i s r equ i red t o move f rom one p l ace t o ano t he r . An empl oye r

should take into account these factors . However this considerat ion

must be balance against an employer 's r ight to manage i ts business.

In the absence of any proof of mala f ide or improper motive onthe Applicant 's part , failure by R2 to comply with the transfer order is

tantamount to insubordination which may warrant a dismissal.

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Conclusion

T he v ar io us m at te rs s ta te d a bo ve n ot o nl y c on st it ut e t he

grounds for chal len ging R1' s Award on the ground s of i l legal i ty but

also const i tutes unlawfulness o n the ground of i r ra t ional i ty .

R 1 h ad a rr i ve d a t e r ro n eo u s f in d in g s o r a ct ed o n e vi de n ce

which had no probat ive va lue and not re l i ed on mater i al documents

and evidence adduced before i t , in finding that the act of t ransferring

R2 was mala f ide hence the dismissal is without just cause or excuse.

O n t he t ot al it y o f t he f ac ts a nd c ir cu ms ta nc es A pp li ca nt 's

decis ion to t ransfer R2 was wel l wi thin the scope of the Appl icant ' s

managerial prerogat ive to t ransfer.

The t ransfer exercise was carr ied out for a val id reason in the

i n t e re s t o f t he company ' s bus i ness . R2 had been se l ec t ed because

h e h ad t he e xp e ri en c e a n d s e ns it iv it y t o e ns u re t he s u cc e ss f ul

c omp le ti on o f t he p ro je ct . F ur th er, h e w as n ot p la ce d in a ny

disadvantaged posi t ion as a resul t of the t ransfer :

The act of t ransferring R2 to the Kuantan branch was bona f ide

and his persistent refusal to comply with the transfer order constitutes

an act of insubordination.

Furthermore, s . 13 of the Industr ia l Relat ions Act , 1967 also

recognizes the prerogative of an employer to t ransfer an employee

wi thout any change det r imental to the terms of employment and R1

had fai led to consider the object ive and pol icies of the Act .

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I t i s p la in that the R1 had commit ted several errors of fact andl aw whi ch war ran ts i nt er fe rence by t hi s Court . R1 had fai led t o,

amongst o thers , apply the cor rec t p r inc ip les of indus t r i a l l aw and

jur isprudence pertaining to the Applicant 's exercise of managerial

prerogative to transfer, applied the wrong tests, had taken into

account i r re l evant cons iderat ions and fa il ed to t ake into account

relevant considerat ion. The R1's Award can be character ized as one

which is irrational in the Wednesbury's sense.

Based on the forgoing reasons the Applicant's Application was

allowed with the costs of RM2,000.00.

(ZAKARIA SAM)

Judge

High Court Penang.

Dated : 10 JUNE 2013

Counsel:

For the applicants - Lim Heng Sang; M/s Lee Hishamuddin Allen &

Gledhill

For the 2nd respondent - P Jeevaretnam; M/s Jeevaretnam & Co

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Award of Transfer cases - Industrial Court Malaysia