MSS A FACADE FOR DISMISSAL

MSS A FACADE FOR DISMISSAL

MURALI THARAN NAIR A/L G.NARAYANA NAIR V HLMG MANAGEMENT CO SDN BHD 

AWARD NO 276 OF 2020

FACTS 

  • The Claimant was informed that the Group Human Resources would be undergoing restructuring and that the Claimant’s position would not exist, rendering him redundant. The Claimant was offered a Mutual Separation Package (MSP) of 5 months of his last drawn salary. 
  • The Claimant was further informed that 446 Human Resource employee and the Claimant had been selected to be the first one to be retrenched. The Claimant was then sent 2 copies of the MSA which contain a resignation clause and when queried it was answered that this was a standard template used by the Company. It was not stated in the MSA as to why the Claimant was asked to leave employment nor did it stipulate his last day of service. Furthermore, it was insisted that the Claimant still need to submit a written resignation. 
  • The MSA was amended a couple of time and the Claimant left with no other alternative signed the first copy of the MSA with a note “Accepted due to restructuring and redundancy” underneath his signature. The Claimant was then asked to sign the second copy without any condition as the first copy is unacceptable. The Claimant contends that he was forced and/or coerced and/or put under duress to accept or to sign the MSA. He was misled by the Company or the Company had misrepresented to him that he was redundant due to the restructuring exercise.
  • The Company content that the Claimant was given the liberty to accept or reject the offer of the mutual separation and that he was fully aware of his legal rights and had signed the MSA voluntarily. The Claimant has displayed unsatisfactory performance in executing his tasks and responsibilities, which thereafter had to be undertaken by other employees. Hence there was no longer any need to have a dedicated individual performing such functions.

ISSUES

  • Whether there is a dismissal on the facts and if so whether the dismissal was with or without just cause or excuse. 

COURT EVALUATION AND FINDING 

  • The documentary evidence, as well as the oral testimonies, clearly show that the offer of the MSP by the Company was on the basis of redundancy as a result of the restructuring that was being carried out in the Group Human Resources.
  • It is the Court’s finding that the Claimant was indeed forced or pressured into signing the MSA as a result of the misrepresentations made to him that he was deemed redundant pursuant to the restructuring exercise taking place at the Group Human Resource. From the evidence before the Court, the incontrovertible conclusion is that the MSA was not voluntarily entered into by the Claimant. The Claimant has succeeded in proving, on a balance of probabilities, that he had been dismissed by the Company in the guise of a mutual separation scheme. 
  • The Company’s contention that the Claimant had displayed unsatisfactory performance also does not hold water in that its own appraisal documents and the testimony of COW-1 during cross-examination show that the Claimant was a good performer and that the mutual separation scheme had nothing to do with performance issues, as admitted by COW-1. Hence, the Claimant had indeed been dismissed by the Company and such a dismissal was made without just cause and excuse.

KEY TAKEAWAYS

  • The main feature of MSP is that there is a mutuality of intention or consensus-ad-idem that the employer will commit itself to a financial pay-out scheme and the employee will in return agree to give up his security of tenure and consent to leave his employer voluntarily.
  • The court cannot in equity and good conscience give effect to a purported mutual agreement which is not genuinely consensual, in particular where the employee’s volitional capacity had been impaired at the time he was purported to have agreed to the mutual termination.
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