KNOWING YOUR RIGHTS AS AN EMPLOYEE: DISMISSAL

You have been working at this particular company for a couple of years. It could be you’re being asked to leave by your employer or the situation made it impossible for you to continue working in your company. You feel distressed and helpless as you do not know what your rights are and what you should do next. Here are some guidelines that may offer you some help:

First of all, determine which of the following situation have caused your termination:

• Direct dismissal- This is when you have been positively told to leave by your employer. Notice in accordance to your employment contract may or may not have been given.

• Constructive dismissal- This is when you are being treated in such a way that left you with no choice but to resign from the company.

This is important as the requirements to be fulfilled in both these situations are different.

Direct Dismissal

If you are being terminated by your employer, ensure that you receive a termination letter. A termination letter is an important evidence, otherwise it will be your words against your employer’s words. This will also prevent your employer from arguing that you have been dismissed due to your absence from work without any reasonable excuse (this constitutes a valid ground for dismissal).

In terminating an employee, the employer must prove that he or she has a just cause or excuse to do so. This is true whether or not notice has been given to you in accordance to the terms provided in your employment contract.

Employers may validly terminate employment for the following reasons:

1. Redundancy/ Retrenchment;
2. Medical Board Over;
3. Voluntary Separation Scheme/ Mutual Separation Scheme
4. Frustration of Contract;
5. Retirement;
6. Misconduct by the employee.

Misconduct

Below are some of the circumstances in which it will be considered as misconduct capable of termination:

• Anything against the Federal Law;
• Where you have been convicted of an indictable offence;
• Insubordination;
• Any actions on your part causing adverse consequences to the company; and
• Absent from work for more than 2 consecutive days without leave and without reasonable excuse.

Due Inquiry and Show Cause

Where there has been misconduct on your part, rendering your performance inconsistent to the conditions within your employment contract, your employer must first conduct a due inquiry. In normal circumstances, there should be at least two warning letters issued by the management detailing the wrongdoing. However, in special circumstances where the misconduct is serious in nature i.e. assaulting customers or stealing- the management may directly issue a suspension order to the employee and then an internal investigation (domestic inquiry) must be carried out and a show cause letter must be given to you, to allow you the opportunity to provide explanation and to defend yourself in a due process.

It is then only the employer may decide on one of the following:

• To dismiss the employee;
• To downgrade the employee; 
• To suspend the employee without wages (not exceeding 2 weeks); or
• To impose any lesser punishment as the employer deems just and fit.

Poor Performance

Your employer may also terminate you for the reason of poor working performance. Before that, these conditions must be satisfied:

• You must be given sufficient notice or warning;
• You must have been given reasonable opportunity/ time to improve your work performance; and
• Despite sufficient notice and opportunity, you have failed to improve your work performance.
• In normal circumstances you will be issued with a PIP – Performance Improvement Plan detailing your shortcomings coupled with the methods to improve

Your employer is allowed to implement any training or programme deemed necessary for your improvement. Also, you cannot refuse a warning letter issued to you. If having been given sufficient warning and time, you still fail to improve your performance, your employer will have a valid ground to dismiss you.

Constructive Dismissal

In this situation, the employee will be required to prove that the employer has severely breached the employment contract, leaving the employee with no choice but to resign. In proving constructive dismissal, the following test will be applied:

• There has been a breach of term of your employment contract by your employer;
• The term is a fundamental term;
• The employee resigns in response to the breach; and
• There has been no delay in the respond.

Examples where there may be a case for constructive dismissal is as follows:

• Your employer deliberately reduces your salary without any good reason;
• Your employer threatens for you to resign;
• You are required to work in an unsafe environment;
• You are asked to perform tasks that are substantially different from what was provided in your employment contract.

Procedures

In both circumstances, you may lodge a representation to the Director General of Industrial Relations as provided under Section 20 of the Industrial Relations Act 1967 (‘IRA 1967’). You will have to personally attend to one of the Industrial Relation (IR) offices to lodge your representation.

Once the representation has been lodged, the officer in charge will proceed to arrange for both the employer and employee to meet to discuss for settlement. The discussion will be facilitated by an IR officer. At this stage, no representation by lawyers are allowed.

The redress provided by s.20 IRA 1967 is for the employee to be reinstated to his former employment. If you are reinstated, your employer will be required to pay you back wages from the date of your dismissal. However, the employer may offer to compensate the employee in lieu of reinstatement. Normally, the compensation will be one month of the employee’s salary for every year of service, subject to the agreement between both parties.  If an agreement can be achieved, then the matter ends here. Otherwise, the matter may be referred to the Industrial Court.

This representation must be lodged within 60 days from the date of your termination and in this circumstance, you are seeking to be reinstated- YOU WANT YOUR JOB BACK! Where you and your company have been registered and contributed to PERKESO, you may also want to apply for Job Search Allowance under the Employment Insurance System (EIS).