Thursday, 19 April 2012
AN OVERVIEW OF A DOMESTIC ENQUIRY
AN OVERVIEW OF A DOMESTIC ENQUIRY
A. INTRODUCTION
1. A domestic inquiry is an internal hearing held by an employer to ascertain
whether an employee is guilty of misconduct. The purpose of a domestic
inquiry is to find out the truth of the allegations made against the workman.
2. The Industrial Court, in the course of adjudicating whether a dismissal is
without just cause or excuse within the context of Section 20 of the Industrial
Relations Act 1967, does not merely examine whether there were proper
grounds for the employer to terminate the services of the employee but also
examines whether the process by which the employee was terminated was fair
or unfair.
3. This aspect of “procedural fairness” in the taking of disciplinary action, against
an employee may often be a crucial factor in deciding whether the dismissal
will be upheld by the Court.
4. It is therefore, imperative to recognise that upholding a dismissal in the
Industrial Court involves satisfying 2 criteria:
(a) That there were proper grounds for terminating the employee;
(b) That the procedure by which the employee was terminated was fair.
5. In conducting a domestic inquiry the rules of natural justice must be adhered
to. Justice must not only be done but must be seen to be done; the “twin
pillars” of natural justice being “No person shall be condemned unheard” and
“No person shall sit in judgment in his own cause or in any in which he is
interested”.
16. It is in this context that the importance of conducting a proper domestic inquiry
assumes significance.
7. The domestic inquiry should not be regarded by the employer as a “mere
formality” nor an unnecessary inconvenience but an integral part of the
disciplinary process whereby the employer can establish that the termination of
the employee was with just cause or excuse. The objective of holding a
domestic inquiry is twofold. Firstly, to give the opportunity to the employer to
prove the charges of misconduct against a delinquent employee before
punishment is meted out and secondly to give the employee sufficient
opportunity to defend himself/herself.
8. Rather than view the domestic inquiry as burden on the management, and an
unnecessary waste of time, resources and expense, the employer, should view
the process of the inquiry as a means to show that every possible means was
made available to avail the employee of meeting the charges against him and,
if possible, clearing himself.
B. POSITION UNDER THE EMPLOYMENT ACT 1955
9. Under Section 14(1) of the Employment Act, 1955, it is stated that an
employer may, AFTER DUE INQUIRY, dismiss the employee or take other
disciplinary action including downgrading and suspension of the employee on
grounds of misconduct inconsistent with the fulfilment of the express or
implied conditions of service.
210. The effect of the incorporation of the term “DUE INQUIRY” into the
provisions of Section 14(1) of the Employment Act 1955 was considered in
detail in the recent Federal Court decision of Said Dharmalingam v. Malayan
Breweries (Malaya) Sdn Bhd (1997) 1 CLJ 646 where the Court stated as
follows:
“In R. v. BBC, ex parte Lavelle (1982) 1 RId? 404, Woolf J indicated,
albeit obiter, that when there is a procedure for dismissal in an employment
not covered by statute at all, employers must comply with that procedure
for the dismissal to be valid. If the contractual procedure was infringed an
injunction should issue to prevent the dismissal. This view was partly based
on the notion that employment protection legislation had substantially
changed the position at common law, so that ‘the ordinary contract
between master and servant now has many of the attributes of an office.’
In the present case, there is a statutory requirement, to wit, s. 14(1) of the
Act, providing for the elementary safeguard of the right to “due inquiry” by
the employer. It follows, that at least, prima facie, a dismissal in breach of
s. 14(1) would be void.
Having said that, we must add, that when, as here, a claimant is an
employee within the meaning of the Act, he has by s. 14(2) thereof a
statutory right to “due enquiry” by his employer, and so, the approach of
the Industrial Court or for that matter the High Court, in considering the
question whether the claimant had been dismissed without just cause or
excuse, would be, to examine the decision not just for substance but for
process as well.”
311. The decision of the Federal Court in Said Dharmalingam clearly states in
respect of employees governed by the Employment Act that unless there is due
enquiry prior to dismissal for misconduct, the dismissal can be struck down by
the Industrial Court even if the employer can show sufficient grounds to
dismiss. Hence, “procedural fairness” is crucial in successfully upholding the
dismissal.
12. It should perhaps be noted that an earlier Federal Court decision in Milan
Auto Sdn Bhd v Wong Sen Yen (1996) 1 AMR 49 held that the requirement
of “due inquiry” before dismissal in Section 14(1) of the Employment Act
was not mandatory and, even if there was a defective inquiry, it was “curable”
in the sense the Industrial Court could still enquire into the decision to dismiss
and uphold the same if proper grounds were made out.
13. It is respectfully suggested that the decision in the Milan Auto case can be
explained on the basis that there, the Industrial Court wrongly struck down a
dismissal without inquiring into the merits of the dismissal which it was
required to do under Section 20 of the Industrial Relations Act, 1967.
However, given that the most recent pronouncement on the question of due
inquiry, is as set out in the said Dharmalingam’s case, it is respectfully
suggested that all prudent employers should, when dealing with complaints of
misconduct of employees governed by the Employment Act, ensure that a
proper inquiry is conducted or run the risk of dismissal being struck down.
C. POSITION OF EMPLOYEES NOT GOVERNED BY THE
EMPLOYMENT ACT, 1955
14. With regard to these employees, the general rule that a failure to hold a
domestic inquiry or the holding of a defective inquiry will not automatically
vitiate or nullify the dismissal still applies.
415. This was the approach taken by the Federal Court in the case of Ong Yuen
Hock v Syarikat Hong Leong Assurance Sdn Bhd (1995) 2 MLJ based on
the earlier leading decision in Dreamland Corporation (M) Sdn Bhd v.
Choong Chin Sooi (1988) 1 MLJ. Essentially, these decisions state that even
if the domestic inquiry held was defective, it is still open to the employer to
satisfy the Industrial Court that the dismissal was proper on the merits.
16. It is respectfully suggested that as a matter of good industrial practice and
irrespective of which the employee is governed by the Employment Act or not,
a domestic inquiry should be held whenever a complaint of misconduct is
brought to ensure that the employee is accorded fair treatment in answering the
charge.
17. We shall now examine briefly the various stages of the domestic inquiry and
the necessary procedures to ensure that no challenge can be successfully taken
to claim the inquiry as unfair.
D. BRIEF GUIDELINES FOR CONDUCTING A PROPER INQUIRY
18. It is essential to keep bear in mind, at all times, that there are no fixed criteria
as to what constitutes a proper inquiry. Every case must necessarily depend on
the particular circumstances and the degree of formality and rules adopted
would also be determined by the prevailing circumstances.
19. What is of utmost importance, however, is that the basic principles of natural
justice are observed. These may be summarised as follows:-
(i) That the employee is given an opportunity to know, in full, the charges
made against him.
5(ii) The employee has reasonable opportunity of defending himself against
the charges.
(iii) The management team which sits as the Inquiry Panel should be
unconnected with the events and circumstances surrounding the charge:
20. It would be noticed that these are not simply legal requirements but basic
concepts of fairness and justice designed to ensure that the employee is given a
proper hearing to answer the charges made against him.
E. PROCEDURE PRIOR TO INQUIRY
E1. INVESTIGATION OF COMPLAINT
21. Normally, the source of the complaint comes from the employee’s immediate
superior or a fellow employee.
22. It is essential to investigate the complaint as soon as possible. This has the
double advantage of obtaining the relevant evidence before it becomes difficult
or impossible to trace and also to avoid any allegation by the employee
subsequently that the employers have “condoned” the alleged misconduct.
23. It is always useful to interview all parties concerned in the complaint and have
their statements recorded. In charges involving financial irregularities and
misconduct, it is best that an internal audit be conducted and full and
comprehensive report be compiled. A difficulty can sometimes arise, if the,
complaint is from an outside source i.e. not within the employment,
organisation and such person is reluctant to give any written statement to
substantiate his complaint. There could be difficulties if the employee, when
confronted, makes a total denial of the allegation.
624. To obviate the difficulty, it is suggested that the outsider complainant (i.e. the
third party), should be persuaded to reduce his complaint in writing so that
disciplinary action can be instituted against the employee concerned. At the
same time, the investigation officer should ascertain if other supporting
evidence from within the Company can be obtained to corroborate or support
the complaint so that the third party’s complaint does not stand by itself.
25. It is also important that the investigating officer is unconnected with the
allegations and not a person who is likely to be selected to sit on the Inquiry
Panel. If the investigation involves some special expertise and skill or
understanding of a particular area of the operations, a suitably qualified person
well versed in the area should be approached to assist in the investigation.
E2. SHOW CAUSE LETTER
26. If the investigation establishes a prima facie case justifying the complaint
which calls for an explanation from the employee, the employer should then
proceed to issue a show cause letter.
27. The letter should be drafted in clear and unambiguous language setting out all
the allegations to which the employee is requested to “show cause”. It should
normally be signed by the Personnel Manager or Head of the Department.
Where the charges are of a technical nature, i.e. misappropriation or breach of
trust, it is best to, draft the same in the format of a charge in a criminal case.
This will immediately highlight the elements of the offence that need to be
proved and would also provide for precision in the drafting. A vague or
ambiguously worded charge in a show cause letter is often indicative that the
employers are unsure of the circumstances giving rise to the charge or even
worse, create an impression that the charges are not bona fide.
728. Where possible, the charge should specifically refer to which rules or
regulations, that have been breached. If no specific rules have been breached, it
is best to state the charges constitute either a breach of both the express and/or
implied terms of the contract of employment.
29. The show cause letter should be confidential and preferably delivered to the
employee personally. If this is not possible, the letter should be sent to the
employee’s address.
E3. SUSPENSION DURING PERIOD TO SHOW CAUSE
30. Care must be taken that the period of suspension and the amount of pay the
employee receives during the period of suspension are in accordance with the
provisions of the Employment Act or relevant Collective Agreement, where
applicable.
31. If extension of the period of suspension is required to complete investigations,
especially upon receipt of the employee’s reply to the show cause letter, the
employee must be notified accordingly. It is advisable to ensure that the
employee receives his full salary for any extended period of suspension.
32. It is normal that suspension is invoked where the presence of the employee is
likely to jeopardise the safety and discipline of the Company and hence, should
only be resorted to where charges of major misconduct are made or there are
several charges.
33. Furthermore, the letter of suspension should not give instructions that the
employee should stay at his place of residence during working hours as such an
order amounts to house arrest and is unlawful. Malayan Banking Berhad v.
Association of Bank Officers Peninsula Malaysia (Award 347 of 1986)
834. Depending on the reply received from the employee, the Company may
proceed to institute a domestic inquiry. This may be necessary even if an
employee, in his reply to the show cause letter, gives a vague response and
appears to admit to only some of the charges or just part of the charge.
E4. THE DOMESTIC INQUIRY PROPER
35. The first step is to send a notice of the domestic inquiry to the employee
concerned. The notice should give particulars of the date, time and place of the
inquiry and should stipulate that the employee would be entitled to crossexamine the employer’s witnesses and may, himself, produce witnesses or
documents to rebut the charges.
36. Where there are several charges of a detailed nature, care must be taken to
ensure that the period of time between the notice of domestic inquiry and the
actual inquiry is of a reasonable period to prepare his defence.
37. In the meanwhile, the employers should proceed to select the panel of
members for the inquiry. The basic criteria for the selection should be:
(a) Officers who are not involved directly with the investigation and
circumstances of the case.
(b) Officers should normally be of a rank or status above the employee
facing the disciplinary charges.
(c) The Chairman should be adequately well versed with the, general,
legislation involving employment and the Industrial Court awards.
38. Of particular importance is the rule that the Panel should not be seen to be
biased or even appear biased. In a number of cases the Industrial Court has
held that the element of bias vitiates the fairness of the dismissal.
939. In Oriental Bank Bhd v Zulkiflee b. Hassan, Kaiang (1986) 2 ILR 1332 the
Claimant was dismissed for breach of the express terms and limit of authority
by which he was bound and/or breach of general duty of care obligatory upon
him.
40. The Claimant contended that the inquiry held was not carried out properly and
his dismissal was unlawful, mala fide and amounted to an unfair labour
practice.
41. In this case, the Chairman of the Inquiry was fully informed of the results of
the investigation conducted by the investigator. Subsequently, he had a
meeting with the Claimant before the Inquiry where the Claimant gave his own
story. Another member of the inquiry was also present during the meeting. The
Chairman and the member knew all the facts of the allegation prior to the
inquiry.
42. It was held that there was an element of bias because some of the members of
the inquiry had known the facts of the allegations. Although the claimant was
guilty of gross negligence and was rightly dismissed, since there was bias in
the inquiry the Claimant was entitled to backwages.
43. Similarly, care must be taken to ensure that the Panel does not appear overly
keen to question the employee. This role should be left to the employer’s
representative presenting the case. While the Panel may always clarify points
arising during the course of the proceedings they should not turn the inquiry
into an inquisition.
10E5. NOTES OF INQUIRY
44. All statements given in the inquiry should be carefully recorded either by the
Panel Member or a member of staff for that purpose. Further, the notes should
be typed up and made available for the employee to counter-sign to avoid any
challenge subsequently by the employee. See OYL Condoir Industries Sdn
Bhd v. Kulijan a/i Muthusamy & 2 ors (1992) 2 ILR 33 where the Court
held that the domestic inquiry was conducted unfairly and unjustly as the
Claimants were not allowed to call witnesses, no notes of proceedings were
recorded nor made.
45. The general procedure at the inquiry would normally be as follows:
The Charge must be read to the employee and explained to him at the
commencement of the inquiry. If he admits the charge, he should be given the
opportunity to express the circumstances that led him to commit the offence
and mitigates his case. The Chairman then will ask the officer presenting the
case to briefly state the facts of the case including how the offence was
committed to enable the Panel to recommend the appropriate punishment or
continue with the proceedings.
If the employee concerned is absent without an explanation offered, the case
may still be heard in his absence and the outcome of it must be communicated
to him.
Any witnesses, called by either party to give statements, is to be subject to
cross-examination by the other party. In other words, there will be an
examination in chief by one party, cross examination by the other party and reexamination by the former party of witnesses. Statements made by these
witnesses must be recorded and signed by them. They must not be in the room
where the inquiry is being held until called in by the Chairman.
1146. It must also be noted that while an employee may be accompanied by a Union
representative at the inquiry, he is not entitled to insist on legal representation.
Petroleum Nasional Bhd v. Mohd Radzuan B. Rarnli 1993 1 ILP. 100 and
Sime Darby Plantation Sdn Bhd v. Wong Chu Meng 1983 2 ILR 210.
E6. PROCEDURE SUBSEQUENT TO INQUIRY
47. After the inquiry, the Chairman should discuss the case with the Panel
Members and decide upon the merits of the case.
48. Findings should be contained in a report which should be based on the material
and evidence produced at the inquiry giving reasons in brief for conclusions on
the charges.
49. In Standard Chartered Bank v. Cliff a/l James (1991) 2 ILR 1168, the
Court held that as no finding of the inquiry was recorded at the end of the notes
of inquiry, this effectively invalidated the inquiry and the Court was entitled to
disregard the notes of inquiry.
50. The Report, once finalised, is then sent to the appropriate executive or officer
in management for taking the requisite action. Unless it is expressly
empowered to do so, the Panel should refrain from determining what the
punishment should be meted out although they may merely recommend
disciplinary actions. The reason is that the question of meting out the
appropriate punishment does not involve the deliberation of the finding of the
charges but other factors such as the employee’s previous records, warnings
etc. which would not normally be available to the Panel.
1251. Once management is in a position to fully consider all the relevant factors, then
the appropriate disciplinary action can be taken. If dismissal is decided, the
employee should be informed as soon as possible and also on what grounds he
is being dismissed. If there is a right of appeal within the disciplinary
procedures against the decision, the employee should be directed to that fact
and informed of the period and to whom he may exercise his right of appeal. In
this regard, the decision of Said Dharmalingam is again of importance. In that
case, the Court held that it is incumbent on an employer to provide the
employee an opportunity to make a plea in mitigation.
52. As was stated by the Court:
“Due inquiry for the purposes of Section 14 of the Act includes the right to
make representations against the punishment proposed as a result of
adverse findings by a domestic body”
The Court, however, held that a plea of mitigation is not necessary where the
employment contract states that dismissal mandatory upon a particular finding
or where the misconduct is so grave that no useful purpose would be served by
a plea in mitigation.
53. Once all avenues for internal appeals are exhausted and assuming that the
employees appeal is rejected, the employee should be so informed. It is normal
to pay the employee whatever monies due subject to income tax clearance and
request that all company property be returned.
54. If these procedures and guidelines are adhered to, an employer should be well
on his way to being able to defend successfully an unfair dismissal complaint
in the Industrial Court.
_______________________________________________________________
Diciplinary Process - Rights of Employees
NATURAL JUSTICE
(For Malaysia and almost all Commonwealth countries)
An employer ought to give an employee the opportunity to be
heard because it is one of the fundamental principles of natural justice which
no employer can afford to ignore. In R
vs CambridgeUniversity (1715) I Strange 557 at 567;93 ER 698 at 704 Fortescue J
explained that “Even God did not pass sentence on Adam before he was called
upon to make his defence”
Industrial Court (IC) Award 88/74 The court made a remark
“Natural justice requires that no man be condemned unheard”
the Principles of Natural Justice :
1. Audi alteram partem - both sides shall be heard
IC Award 138/85, the Court held
that there should be due inquiry with charge or charges framed and the employee
given ample opportunity to defend himself or be heard.
2. Nemo judex in propia causa - no
man shall be judge in his own cause.
IC Award 247/86 is emphatic when
it states :- IC Award No. 142 of 1986
serves as a good lesson for the employer.
Great care must be taken to see that the rules of natural justice are
followed……..
In Surinder Singh Kanda vs Government of the Federation of
Malaya (1962) MLJ 169 Lord Denning had this to say: …..The rule against bias is one thing. The right to be heard is another. Those two rules are the essential
characteristics of what is often called ‘natural justice’. They are the twin pillars supporting it. They have recently been put in two words
‘impartiality’ and ‘fairness’. But they
are separate concepts and are governed by separate conditions. The workman must know what evidence has been
given and what statements have been made affecting him: and then he must be
given a fair opportunity to correct or contradict them. In the case of Board in Ceylon University vs Fernando (1960)
the Lordship made a remark ‘whoever has
to adjudicate must not hear evidence or receive representative from one side
behind the back of the other’.
CHARGES
The charges or allegation against the accused must be very
clear. The charges cannot be vague
and baseless as company’s rules and
regulation must be cited with the
charges. IC has made it clear vide Award
No. 86 of 1977 and Award 82 of 1982 that charges should not be vague and should
cite the company rules and regulation which have been breached.
NOTICE OF INQUIRY
1. That
the notice of inquiry should mention the
right of the accused to cross-examine the bank’s witness.
2. To
provide the accused with copies of all statements of all witnesses together
with the notice of this inquiry for the accused to prepare his defence before
the inquiry. Copies of statements of all
witness should be extended to the accused before the inquiry as per Award
164/85, 87/86, 279/86 and 252/88 which held that copies of the statements of
all witnesses should be extended to the accused before the inquiry.
3. The
CHARGES.
PUNISHMENT
IC Award no 50/86: was stated that withholding of annual
increment is considered a form of punishment.
VICTIMISATION
we should observed the defects of victimisation
is very clear such as :
the Investigation
Officer (IO) who investigated this
case :
1. never
ever issue any query to the accused and also failed as IO to take proper
statements from the accused. IO should
identify that his investigation should not violate the internal system of the
organization. E.g. that it is clear that
the Audit Division violated their own rule as clearly stated in the Audit
Manual that “ Workman will be provided with the opportunity to formally respond
queries and their comments will be included in the final report” and that “a
draft report for discussions with the workman will be produced at the end of
each investigation within 4 weeks after the completion of the investigation
work” The IO should ensure not to violate the company’s own rule and ethics.
2. IO
should look out for contradictions in the statements by various witnesses.
3. IO
to check and ensure whether the company has in the past condoned such
misconduct by me and other employees. Award 136/93 and 179/93.
4. IO
should not attempt to cover up major weaknesses on the company’s system in the
course of his investigations and thereby violate his own code of ethics. IC Award
148/85, whereby in the course of his investigation, the IO should not
cover up weaknesses of the company.
i)
IO should be independent while investigating the
case. He should maintain fairness and
not allow prejudices or bias or influence of the others to override
objectivity. IO state whether the
incident occurred because of the shortcomings in the company’s working
system. He should highlight the
integrity of the data and facts obtained
Also IO should highlight the
mitigating factors that certain consideration should be given to the accused,
if any such facts exist. He should not rely on one person or one source to
obtain facts.
5. IO
should be sure which particular rule or
regulation of the company that the accused breached. IO should not proceed to
propose there is a case against the workman if he is uncertain of the
violation, as the accused may later prove
the uncertainty of the Investigation Officer. I wish to refer to IC Award 82/82 whereby he
should ensure that the charges relate to the company rules and
regulations. To punish a worker for a
misconduct which do not appear in the company’s rules and regulations is very
questionable. Management should not be
misrepresented by the IO.
6. The
IO did not check all other departments/units/sectors as the way he checked on
the accused to ensure that there were so such similar issues in the past or
presently happenings. This is a clear
victimisation as no other departments/units/sectors were checked in this manner
i.e checked backwards eventhough the various years audit reported satisfactory
and the checking was done after the accused was transferred out of that
position. IO should be sure to confirm
whether there were earlier such similar incidents that were condoned by the
management.
IO should not give
his personal opinions
The IO should not give his personal opinion or views during
presentation, but confine himself to the facts arising from his
investigations. Award 279/86
IO is not allowed to
ask any question
IO should remain a
neutral position
IO should present his case as this is his job and should
remain neutral. He should not have
personal interest against the accused.
Prosecutor (failed
to) : Obligations of the Prosecutor
- Must call the complainant to be a witness during the prosecution and to allow the accused to cross examine him. When prosecutor failed to call the complainant - Ref. Holiday Inn Hotel, Penang and National Union of Hotel and Restaurant Workers (Award No. 90 of 1987) whereby the company failing to call two material witnesses to give evidence at the enquiry and by failing to take into account their recorded statements, has violated the principles of natural justice.
- That the notice of inquiry did not mentioned the right of the accused to cross-examine the employer’s witness.
- To provide the accused with copies of all statements of all witnesses together with the notice of this inquiry for the accused to prepare his defence before the inquiry. Copies of statements of all witness should be extended to the accused before the inquiry as per Award 164/85, 87/86, 279/86 and 252/88 which held that copies of the statements of all witnesses should be extended to the accused before the inquiry. Call all witnesses that gave statements to the IO during his investigation for the accused to cross-examine. - IC Award 282/87.
- That the person who made the allegation did not personally see the incident. IC Award 304/87.
- The charges or allegation against the accused must be very clear. The charges cannot be vague and baseless as company’s rules and regulation must be cited with the charges. IC has made it clear vide Award No. 86 of 1977 and Award 82 of 1982 that charges should not be vague and should cite the company rules and regulation which have been breached.
- Management must allow the accused to call any witness as he wish and expenses to be borne by the company, if any. Management should not harass the witness requested by the accused. Witnesses should not be intimidated by harassing him/her on the expenses claimed
- A clear victimisation and injustice when the request by the accused to postpone on an inquiry session for purpose of preparation being denied. There is a clear case of reference : United Traction Co. Sdn Bhd Butterworth and Transport Workers Union (Award No. 40 of 1987) whereby workman requires sufficient time to study the statements made by the witness.
- The Industrial Relation manager took very lightly on the request for witnesses and informed the accused that it is just a request and is not an order is violation of natural justice.
- Comply to IC award No. 164/85, 87/86, 279/86, 152/85 & 142/86 when documents pertaining to the case were given to the panel prior to the inquiry i.e. before the start of the first session. The award stressed that the panel should not read any statements or reports pertaining to the accused or the case prior to the inquiry
PANEL OF INQUIRY
1. Which should have only copies of the charge
sheets prior to the inquiry had already had and read the file of the case prior
to the charge being read out to the accused.
Panel member should not read any statements or even look into any
records pertaining to the case before the inquiry. In this instance, this inquiry is indeed
defective and unfair - IC Award 152/85 and 142/86. Panel
put questions as they had previous knowledge of the facts. Panel should never be briefed before, during
or even after the hearing of the case.
Ref. Malayan Tobacco Co. Bhd and
Chow Yong Peng (Award No. 87 of 1986)
& Ref. Lori Malaysia Bhd and Transport Workers Union
(Award No. 69 of 1987)
2. The Chairman
or any of the Panel members did not explain the ground rules of the inquiry to
the accused as to the process when he should cross-examine the witness and when
to commence his defence.
3. The
panel members should ask, listen and
consider the valid preliminary objections raised by the accused.
4. It
is of primary importance to bring to the attention of the Panel members, even
though all the Panel members are being appointed by the management to conduct
the inquiry it does not necessarily follow that the Panel members should uphold
the management’s case against the
accused. He should not be found guilty just simply because one or more senior
member of the management personally wanted so. This
inquiry should not be a vehicle for the management’s victimisation against the
accused. The panel’s decision should
be based on facts that are substantial and reasonable.
5. Panel should not ask incriminating
questions
Panel should confine themselves to questions that would clear any
doubts.
Award 347/86
6. Chairman and Panel members should know and
have knowledge that IO should not give
his personal opinions pertaining to
the case against the accused.
The IO should not give his personal opinion or
views during presentation, but confine
himself to the facts arising from his investigations.
Award 279/86
and also IO is not allowed to ask any question
7. Appointment
of the panel, by whom?
The
panel should be appointed by Head of HR or any other such person who is higher than the accused.
ERROR BY MANAGEMENT
1. Condonation : By doing so the management had condoned the misconduct,
if any. Chairman of Industrial
Court in the Bank Bumiputra (M) Bhd and
George Thomas warned that “Even if the
workman is guilty of the charge, the bank having failed to take action after a
very long period of time had condoned the mistake/misconduct, if any.” The award went to say that “once an employer had condoned any misconduct
which would have justified dismissal or fine, the employer cannot after such
condonation go back upon the employer’s election to condone and claim right to
dismiss the employee or to impose fine or any other punishment in respect of
the offence which has been condoned”
(Condonation : forgiveness or
passing over without any blame.) Another
case is there should be no discrimination between one employee and another for
the same offence committed under the same or similar circumstances. The panel and the PO should not try to cover
the company’s weaknesses. The bank
should not adopt double standards in meting out punishments Ref. Chartered Bank and NUBE (Award No. 104
of 1983) and also Award 115/87.
2. Failed
to conduct the inquiry within reasonable time. In the IC Award 282/87 “the inquiry was found
improper that the bank did not take action against the accused until seven and
a half months after the incident. Employer extend beyond the time within which
the employer might reasonably be expected to take decision. In this IC case, the bank should have acted
within a reasonable time and certainly waiting for about 6 months is not
considered to be reasonable time. Ref.
BBMB and George Thomas (Award No. 282 of
1987)
3. Postpone
the cases several times after written notice being issued to the accused
beside the verbal information being conveyed by the Industrial Relation
officer. This has caused duress on the
accused and had effected his health and if able to prove shall be considered as
victimisation.
4. If
the charges related in the process of inquiry
show or prove gross negligence
and lack of efficiency on the part of the management. The Industrial Court Award No. 137 of 1986 (
UMBC and ABOM) found it necessary to emphasise the unsatisfactory system of
operation which prevailed in the bank during the material time which suggested
gross negligence and lack of efficiency on the part of management. The accused may reiterate the inefficiency on
the part of the management which now tried to throw the blame on an employee in
the process of victimisation against employees.
5. Code of Conduct for Industrial Harmony
The issue of Code of Conduct for Industrial Harmony which was signed by the
Malayan Council of Employers’ Organisation (MCEO) and Malaysian Trades union
Congress (MTUC) and the Minister of Labour and Manpower Malaysia signed on 9th
February 1975 and became law as from 30th May 1980 as the code is
envisaged by Section 30(5A) of the Industrial Relation Act 1967.
It is doubted
that management of many companies are
aware of the existence of such Code of Conduct.
To highlight few
points:
When management is seen to be very keen to punish employees,
management neglect their essential duties to establish complete and proper
rules and regulations and to make such rules and regulation readily available. That is not all, management should make every
effort to ensure that employees know and understand them (rules &
regulations) and the best way to achieve the same is to give every employee a
copy of the rules and by explaining them orally.
6. DOUBLE JEOPARDY
1.
Punished Twice
Another issue that should be noted is the issue of double
jeopardy whereby a suspect or wrong-doer is dismissed after an earlier
punishment say, in the form of transfer.
Ref. MAS and A.T. Xavier (Award
No. 92 of 1983)
Withholding annual increment. Award no. 50/86, it was stated that withholding of
annual increment could be considered a form of punishment for misconduct.
Principles of Nemo Debat Bis Puniri Pro Uno Delicto ie. No one should be punished twice for one fault Where is the natural justice, only
victimisation of highest degree is obvious.
I wish to quote the Industrial Court President Fong Seng Yee in the IC
Award No. 247 of 1986 as said “Award No. 142 of 1986 serves as a good lesson
for the employer. Great care must be
taken to see that the rules of natural justice are followed. If there is any failure in that respect by
the employer, the employer has to pay dearly for the error, so that security of
employment, a commodity now precious, can be safeguarded.”
- Charged Twice
A person should not be charged twice for the same offence.
7.
Charges cannot be amended when case is taken to Industrial Court
Decide
specifically as regards to the offences and the charges because no change is
permitted. Ref. UMBC, Taiping and ABOM (Award No. 137 of
1986)
8. Amend
of charges at the inquiry
Should the company amend or add to the
charges, an extension is compulsory.
IC Award 55/84
To amend the charges at the
inquiry would give the accused insufficient time to prepare his case and this would certainly
be a violation of the principles of natural justice. Award 137/86
9.
Charges cannot be added at the inquiry
(Award no. 89
of 1982) Charges cannot be added or amended during the inquiry process.
10. Reluctant to allow senior executives to be a
witness Award 7/74
WITNESS
The company failing to call two
material witnesses to give evidence at the enquiry and by failing to take into
account their recorded statements, has violated the principles of natural
justice. Ref. Holiday Inn Hotel, Penang
and National Union of Hotel and Restaurant Workers (Award No. 90 of 1987)
12. EVIDENCE
Oral evidence must be direct -
must be from person who saw it.
-
Must be from person who heard it
The employer must produce convincing evidence that the
workman is guilty of the charge.
Ref. Wah Soon Sdn Bhd and Lau Ah
Yu and Low Sang Lee (Award no. 240 of 1986)
13. Equality of punishment
There should be equality of punishment, if the charges and
the past records(of a previous case) are the similar, there should be no
difference in punishments. Award no.
115/87.
14. Unsatisfactory system of operations in the company
The court found it necessary to emphasise the unsatisfactory
system of operations which prevailed in the bank during the material time in
which suggested gross negligence and lack of efficiency on the part of
management. Ref. UMBC, Taiping and ABOM
(1986) ILR 684 (award no. 137 of 1986)
15. Panel
should not read reports prior to the inquiry
Panel should not read any other statements or report
pertaining to the accused or the case prior to the inquiry. Award 152/85 & 142/86
IO should not extend copies of the statements of witnesses
to the panel. Award 164/85, 87/86 and 279/86
16. Copies of statements of all witness should
be extended to accused before the
inquiry.
Award 164/85, 87/86,
279/86 and 252
RIGHTS OF THE ACCUSED
The simple but golden
rule for the accused - which
employers will do well to remember when conducting inquiries of this kind is to
make certain that the worker against whom disciplinary action may be taken,
actually see and hear all the witnesses from whom statements are taken and that
he is allowed the opportunity of not only confronting but also questioning them
one by one.
Withholding annual increment
Award no. 50/86, it was stated that withholding of annual
increment could be considered a form of punishment for misconduct.
Panel should not ask incriminating questions
Panel should not play the role of asking incriminating
questions. Instead the panel should
confine themselves to questions that would clear any doubts. Award 347/86
Condoned to similar
acts
The IO should verify that the company has not condoned to
similar acts of misconduct in the past and examine the company’s security
system and working procedure. The
purpose of this exercise is to ensure that the company itself is beyond
reproach before the company pursues a case against the accused. The company should not use the accused as a
scapegoat for its fault and shortcomings.
Award136/93 & 179/93
IO should not cover
company’s weaknesses
In the course of his investigations, the IO should not
attempt to cover the major weaknesses of the company.
CHECK AND TO DISCUSS
THE METHOD OF RECORDING
Notes should be verbatim, i.e. in the form of questions and
answers (award no. 66 of 1976)
Closing remarks
For the summary - Misconduct
outside the sphere of employment
If the employers had carried defective inquiry or the rules
of natural justice had not been
observed during the inquiry process. The
inquiry must be seen to be must in fact be conducted in a fair and impartial
manner
For further questions, email to : bang.the.bank.my@gmail.com
Domestic Inquiry - Rights of Employees
NATURAL JUSTICE
An employer ought to give an employee the opportunity to be
heard because it is one of the fundamental principles of natural justice which
no employer can afford to ignore. In R
vs CambridgeUniversity (1715) I Strange 557 at 567;93 ER 698 at 704 Fortescue J
explained that “Even God did not pass sentence on Adam before he was called
upon to make his defence”
Industrial Court (IC) Award 88/74 The court made a remark
“Natural justice requires that no man be condemned unheard”
the Principles of Natural Justice :
1. Audi alteram partem - both sides shall be heard
IC Award 138/85, the Court held
that there should be due inquiry with charge or charges framed and the employee
given ample opportunity to defend himself or be heard.
2. Nemo judex in propia causa - no
man shall be judge in his own cause.
IC Award 247/86 is emphatic when
it states :- IC Award No. 142 of 1986
serves as a good lesson for the employer.
Great care must be taken to see that the rules of natural justice are
followed……..
In Surinder Singh Kanda vs Government of the Federation of
Malaya (1962) MLJ 169 Lord Denning had this to say: …..The rule against bias is one thing. The right to be heard is another. Those two rules are the essential
characteristics of what is often called ‘natural justice’. They are the twin pillars supporting it. They have recently been put in two words
‘impartiality’ and ‘fairness’. But they
are separate concepts and are governed by separate conditions. The workman must know what evidence has been
given and what statements have been made affecting him: and then he must be
given a fair opportunity to correct or contradict them. In the case of Board in Ceylon University vs Fernando (1960)
the Lordship made a remark ‘whoever has
to adjudicate must not hear evidence or receive representative from one side
behind the back of the other’.
CHARGES
The charges or allegation against the accused must be very
clear. The charges cannot be vague
and baseless as company’s rules and
regulation must be cited with the
charges. IC has made it clear vide Award
No. 86 of 1977 and Award 82 of 1982 that charges should not be vague and should
cite the company rules and regulation which have been breached.
NOTICE OF INQUIRY
1. That
the notice of inquiry should mention the
right of the accused to cross-examine the bank’s witness.
2. To
provide the accused with copies of all statements of all witnesses together
with the notice of this inquiry for the accused to prepare his defence before
the inquiry. Copies of statements of all
witness should be extended to the accused before the inquiry as per Award
164/85, 87/86, 279/86 and 252/88 which held that copies of the statements of
all witnesses should be extended to the accused before the inquiry.
3. The
CHARGES.
PUNISHMENT
IC Award no 50/86: was stated that withholding of annual
increment is considered a form of punishment.
VICTIMISATION
we should observed the defects of victimisation
is very clear such as :
the Investigation
Officer (IO) who investigated this
case :
1. never
ever issue any query to the accused and also failed as IO to take proper
statements from the accused. IO should
identify that his investigation should not violate the internal system of the
organization. E.g. that it is clear that
the Audit Division violated their own rule as clearly stated in the Audit
Manual that “ Workman will be provided with the opportunity to formally respond
queries and their comments will be included in the final report” and that “a
draft report for discussions with the workman will be produced at the end of
each investigation within 4 weeks after the completion of the investigation
work” The IO should ensure not to violate the company’s own rule and ethics.
2. IO
should look out for contradictions in the statements by various witnesses.
3. IO
to check and ensure whether the company has in the past condoned such
misconduct by me and other employees. Award 136/93 and 179/93.
4. IO
should not attempt to cover up major weaknesses on the company’s system in the
course of his investigations and thereby violate his own code of ethics. IC Award
148/85, whereby in the course of his investigation, the IO should not
cover up weaknesses of the company.
i)
IO should be independent while investigating the
case. He should maintain fairness and
not allow prejudices or bias or influence of the others to override
objectivity. IO state whether the
incident occurred because of the shortcomings in the company’s working
system. He should highlight the
integrity of the data and facts obtained
Also IO should highlight the
mitigating factors that certain consideration should be given to the accused,
if any such facts exist. He should not rely on one person or one source to
obtain facts.
5. IO
should be sure which particular rule or
regulation of the company that the accused breached. IO should not proceed to
propose there is a case against the workman if he is uncertain of the
violation, as the accused may later prove
the uncertainty of the Investigation Officer. I wish to refer to IC Award 82/82 whereby he
should ensure that the charges relate to the company rules and
regulations. To punish a worker for a
misconduct which do not appear in the company’s rules and regulations is very
questionable. Management should not be
misrepresented by the IO.
6. The
IO did not check all other departments/units/sectors as the way he checked on
the accused to ensure that there were so such similar issues in the past or
presently happenings. This is a clear
victimisation as no other departments/units/sectors were checked in this manner
i.e checked backwards eventhough the various years audit reported satisfactory
and the checking was done after the accused was transferred out of that
position. IO should be sure to confirm
whether there were earlier such similar incidents that were condoned by the
management.
IO should not give
his personal opinions
The IO should not give his personal opinion or views during
presentation, but confine himself to the facts arising from his
investigations. Award 279/86
IO is not allowed to
ask any question
IO should remain a
neutral position
IO should present his case as this is his job and should
remain neutral. He should not have
personal interest against the accused.
Prosecutor (failed
to) : Obligations of the Prosecutor
- Must call the complainant to be a witness during the prosecution and to allow the accused to cross examine him. When prosecutor failed to call the complainant - Ref. Holiday Inn Hotel, Penang and National Union of Hotel and Restaurant Workers (Award No. 90 of 1987) whereby the company failing to call two material witnesses to give evidence at the enquiry and by failing to take into account their recorded statements, has violated the principles of natural justice.
- That the notice of inquiry did not mentioned the right of the accused to cross-examine the employer’s witness.
- To provide the accused with copies of all statements of all witnesses together with the notice of this inquiry for the accused to prepare his defence before the inquiry. Copies of statements of all witness should be extended to the accused before the inquiry as per Award 164/85, 87/86, 279/86 and 252/88 which held that copies of the statements of all witnesses should be extended to the accused before the inquiry. Call all witnesses that gave statements to the IO during his investigation for the accused to cross-examine. - IC Award 282/87.
- That the person who made the allegation did not personally see the incident. IC Award 304/87.
- The charges or allegation against the accused must be very clear. The charges cannot be vague and baseless as company’s rules and regulation must be cited with the charges. IC has made it clear vide Award No. 86 of 1977 and Award 82 of 1982 that charges should not be vague and should cite the company rules and regulation which have been breached.
- Management must allow the accused to call any witness as he wish and expenses to be borne by the company, if any. Management should not harass the witness requested by the accused. Witnesses should not be intimidated by harassing him/her on the expenses claimed
- A clear victimisation and injustice when the request by the accused to postpone on an inquiry session for purpose of preparation being denied. There is a clear case of reference : United Traction Co. Sdn Bhd Butterworth and Transport Workers Union (Award No. 40 of 1987) whereby workman requires sufficient time to study the statements made by the witness.
- The Industrial Relation manager took very lightly on the request for witnesses and informed the accused that it is just a request and is not an order is violation of natural justice.
- Comply to IC award No. 164/85, 87/86, 279/86, 152/85 & 142/86 when documents pertaining to the case were given to the panel prior to the inquiry i.e. before the start of the first session. The award stressed that the panel should not read any statements or reports pertaining to the accused or the case prior to the inquiry
PANEL OF INQUIRY
1. Which should have only copies of the charge
sheets prior to the inquiry had already had and read the file of the case prior
to the charge being read out to the accused.
Panel member should not read any statements or even look into any
records pertaining to the case before the inquiry. In this instance, this inquiry is indeed
defective and unfair - IC Award 152/85 and 142/86. Panel
put questions as they had previous knowledge of the facts. Panel should never be briefed before, during
or even after the hearing of the case.
Ref. Malayan Tobacco Co. Bhd and
Chow Yong Peng (Award No. 87 of 1986)
& Ref. Lori Malaysia Bhd and Transport Workers Union
(Award No. 69 of 1987)
2. The Chairman
or any of the Panel members did not explain the ground rules of the inquiry to
the accused as to the process when he should cross-examine the witness and when
to commence his defence.
3. The
panel members should ask, listen and
consider the valid preliminary objections raised by the accused.
4. It
is of primary importance to bring to the attention of the Panel members, even
though all the Panel members are being appointed by the management to conduct
the inquiry it does not necessarily follow that the Panel members should uphold
the management’s case against the
accused. He should not be found guilty just simply because one or more senior
member of the management personally wanted so. This
inquiry should not be a vehicle for the management’s victimisation against the
accused. The panel’s decision should
be based on facts that are substantial and reasonable.
5. Panel should not ask incriminating
questions
Panel should confine themselves to questions that would clear any
doubts.
Award 347/86
6. Chairman and Panel members should know and
have knowledge that IO should not give
his personal opinions pertaining to
the case against the accused.
The IO should not give his personal opinion or
views during presentation, but confine
himself to the facts arising from his investigations.
Award 279/86
and also IO is not allowed to ask any question
7. Appointment
of the panel, by whom?
The
panel should be appointed by Head of HR or any other such person who is higher than the accused.
ERROR BY MANAGEMENT
1. Condonation : By doing so the management had condoned the misconduct,
if any. Chairman of Industrial
Court in the Bank Bumiputra (M) Bhd and
George Thomas warned that “Even if the
workman is guilty of the charge, the bank having failed to take action after a
very long period of time had condoned the mistake/misconduct, if any.” The award went to say that “once an employer had condoned any misconduct
which would have justified dismissal or fine, the employer cannot after such
condonation go back upon the employer’s election to condone and claim right to
dismiss the employee or to impose fine or any other punishment in respect of
the offence which has been condoned”
(Condonation : forgiveness or
passing over without any blame.) Another
case is there should be no discrimination between one employee and another for
the same offence committed under the same or similar circumstances. The panel and the PO should not try to cover
the company’s weaknesses. The bank
should not adopt double standards in meting out punishments Ref. Chartered Bank and NUBE (Award No. 104
of 1983) and also Award 115/87.
2. Failed
to conduct the inquiry within reasonable time. In the IC Award 282/87 “the inquiry was found
improper that the bank did not take action against the accused until seven and
a half months after the incident. Employer extend beyond the time within which
the employer might reasonably be expected to take decision. In this IC case, the bank should have acted
within a reasonable time and certainly waiting for about 6 months is not
considered to be reasonable time. Ref.
BBMB and George Thomas (Award No. 282 of
1987)
3. Postpone
the cases several times after written notice being issued to the accused
beside the verbal information being conveyed by the Industrial Relation
officer. This has caused duress on the
accused and had effected his health and if able to prove shall be considered as
victimisation.
4. If
the charges related in the process of inquiry
show or prove gross negligence
and lack of efficiency on the part of the management. The Industrial Court Award No. 137 of 1986 (
UMBC and ABOM) found it necessary to emphasise the unsatisfactory system of
operation which prevailed in the bank during the material time which suggested
gross negligence and lack of efficiency on the part of management. The accused may reiterate the inefficiency on
the part of the management which now tried to throw the blame on an employee in
the process of victimisation against employees.
5. Code of Conduct for Industrial Harmony
The issue of Code of Conduct for Industrial Harmony which was signed by the
Malayan Council of Employers’ Organisation (MCEO) and Malaysian Trades union
Congress (MTUC) and the Minister of Labour and Manpower Malaysia signed on 9th
February 1975 and became law as from 30th May 1980 as the code is
envisaged by Section 30(5A) of the Industrial Relation Act 1967.
It is doubted
that management of many companies are
aware of the existence of such Code of Conduct.
To highlight few
points:
When management is seen to be very keen to punish employees,
management neglect their essential duties to establish complete and proper
rules and regulations and to make such rules and regulation readily available. That is not all, management should make every
effort to ensure that employees know and understand them (rules &
regulations) and the best way to achieve the same is to give every employee a
copy of the rules and by explaining them orally.
6. DOUBLE JEOPARDY
1.
Punished Twice
Another issue that should be noted is the issue of double
jeopardy whereby a suspect or wrong-doer is dismissed after an earlier
punishment say, in the form of transfer.
Ref. MAS and A.T. Xavier (Award
No. 92 of 1983)
Withholding annual increment. Award no. 50/86, it was stated that withholding of
annual increment could be considered a form of punishment for misconduct.
Principles of Nemo Debat Bis Puniri Pro Uno Delicto ie. No one should be punished twice for one fault Where is the natural justice, only
victimisation of highest degree is obvious.
I wish to quote the Industrial Court President Fong Seng Yee in the IC
Award No. 247 of 1986 as said “Award No. 142 of 1986 serves as a good lesson
for the employer. Great care must be
taken to see that the rules of natural justice are followed. If there is any failure in that respect by
the employer, the employer has to pay dearly for the error, so that security of
employment, a commodity now precious, can be safeguarded.”
- Charged Twice
A person should not be charged twice for the same offence.
7.
Charges cannot be amended when case is taken to Industrial Court
Decide
specifically as regards to the offences and the charges because no change is
permitted. Ref. UMBC, Taiping and ABOM (Award No. 137 of
1986)
8. Amend
of charges at the inquiry
Should the company amend or add to the
charges, an extension is compulsory.
IC Award 55/84
To amend the charges at the
inquiry would give the accused insufficient time to prepare his case and this would certainly
be a violation of the principles of natural justice. Award 137/86
9.
Charges cannot be added at the inquiry
(Award no. 89
of 1982) Charges cannot be added or amended during the inquiry process.
10. Reluctant to allow senior executives to be a
witness Award 7/74
WITNESS
The company failing to call two
material witnesses to give evidence at the enquiry and by failing to take into
account their recorded statements, has violated the principles of natural
justice. Ref. Holiday Inn Hotel, Penang
and National Union of Hotel and Restaurant Workers (Award No. 90 of 1987)
12. EVIDENCE
Oral evidence must be direct -
must be from person who saw it.
-
Must be from person who heard it
The employer must produce convincing evidence that the
workman is guilty of the charge.
Ref. Wah Soon Sdn Bhd and Lau Ah
Yu and Low Sang Lee (Award no. 240 of 1986)
13. Equality of punishment
There should be equality of punishment, if the charges and
the past records(of a previous case) are the similar, there should be no
difference in punishments. Award no.
115/87.
14. Unsatisfactory system of operations in the company
The court found it necessary to emphasise the unsatisfactory
system of operations which prevailed in the bank during the material time in
which suggested gross negligence and lack of efficiency on the part of
management. Ref. UMBC, Taiping and ABOM
(1986) ILR 684 (award no. 137 of 1986)
15. Panel
should not read reports prior to the inquiry
Panel should not read any other statements or report
pertaining to the accused or the case prior to the inquiry. Award 152/85 & 142/86
IO should not extend copies of the statements of witnesses
to the panel. Award 164/85, 87/86 and 279/86
16. Copies of statements of all witness should
be extended to accused before the
inquiry.
Award 164/85, 87/86,
279/86 and 252
RIGHTS OF THE ACCUSED
The simple but golden
rule for the accused - which
employers will do well to remember when conducting inquiries of this kind is to
make certain that the worker against whom disciplinary action may be taken,
actually see and hear all the witnesses from whom statements are taken and that
he is allowed the opportunity of not only confronting but also questioning them
one by one.
Withholding annual increment
Award no. 50/86, it was stated that withholding of annual
increment could be considered a form of punishment for misconduct.
Panel should not ask incriminating questions
Panel should not play the role of asking incriminating
questions. Instead the panel should
confine themselves to questions that would clear any doubts. Award 347/86
Condoned to similar
acts
The IO should verify that the company has not condoned to
similar acts of misconduct in the past and examine the company’s security
system and working procedure. The
purpose of this exercise is to ensure that the company itself is beyond
reproach before the company pursues a case against the accused. The company should not use the accused as a
scapegoat for its fault and shortcomings.
Award136/93 & 179/93
IO should not cover
company’s weaknesses
In the course of his investigations, the IO should not
attempt to cover the major weaknesses of the company.
CHECK AND TO DISCUSS
THE METHOD OF RECORDING
Notes should be verbatim, i.e. in the form of questions and
answers (award no. 66 of 1976)
Closing remarks
For the summary - Misconduct
outside the sphere of employment
If the employers had carried defective inquiry or the rules
of natural justice had not been
observed during the inquiry process. The
inquiry must be seen to be must in fact be conducted in a fair and impartial
manner
For further questions, email to : bang.the.bank.my@gmail.com
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