Court awards RM2.45 mil to ex-COO for constructive dismissal

Free Malaysia Today, 24 May 2019

KUALA LUMPUR: The Industrial Court here has awarded RM2.45 million compensation to a former chief operating officer of a public bus operating company after it ruled that he was constructively dismissed.

Tengku Mohd Hasmadi Tengku Hashim left his post at Konsortium Transnasional Berhad (KTB) in April 2015 after the chairman's son, Muhammad Hariz Mohd Nadzmi, took over half his job functions.

Tengku Hasmadi, represented by S Muhendaran and G Srividhya, said the 27-year- old Hariz had not even completed his studies that year.

He said that upon returning from his annual leave, he was taken aback when he received a memorandum on March 3, 2015 that Hariz was to be appointed the company's head of group support services.

He then wrote a letter to the company's chairman, Mohd Nadzmi Mohd Salleh, that he considered himself constructively dismissed.

He noted in the letter that Hariz was to report to Nadzmi directly and thus by-pass him. He told Nadzmi this was a serious breach of his employment contract and calculated to humiliate him and lose respect among his subordinates.

Tengku Hasmadi, who had been with KTB for 12 years, said he was solely responsible for the group's operations and support services covering about 3,000 employees.

Industrial Court chairman Fredrick Indran Nicholas, in his 36-page judgment yesterday, said he found Tengku Hasmadi had succeeded in establishing a breach in the relationship of mutual trust and confidence between employer and employee.

"There is a dismissal in the instant case, notwithstanding that the company had not literally 'dismissed' the claimant but rather had forced him to leave his employment by their repudiatory conduct," he said. Nicholas said Tengku Hasmadi, by tendering his resignation, had acted decisively. By this action, he had protested against the company's breach.

"All the evidence, on a balance of probabilities, point to a strong indictment against the company, which it is unable to refute," he said. Nicholas ordered a payment of RM818,505 as compensation in lieu of reinstatement and another RM1,637,010 as back wages.

Question 1

Based on the above case or any other cases that you are familiar with, describe FIVE (5) actions by the management (employer) in an organisation that may lead a workman to consider himself constructively dismissed.

Question 2

Konsortium Transnasional Berhad (KTB) could have prevented Tengku Mohd Hasmadi Tengku Hashim's constructive dismissal claim referred to the Industrial Court. Discuss FIVE (5) management (organisational) strategies that could be employed to prevent constructive dismissal claims by workmen.