You are on page 1of 21


NO. R2-25-46-07 Dalam Perkara suatu Permohonan untuk Perintah Certiorari di bawah Aturan 53, Kaedah-Kaedah Mahkamah Tinggi 1980 Dan Dalam Perkara Akta Perhubungan Perusahaan 1967 Dan Dalam Perkara Award Mahkamah Perusahaan No. 55 Tahun 2007 bertarikh 10hb Januari 2007 ANTARA ROYAL SELANGOR GOLF CLUB DAN 1.



JUDGMENT Mohd Zawawi Salleh, J: Introduction [1] This is an application by the Applicant for an order of

certiorari to quash the Industrial Court Award No. 55 of 2007 handed down by the Industrial Court (Second Respondent) on 10.1.2007. The Second Respondent held that the Applicant had not complied with clause 24.2 of the Collective Agreement (Impugned Award). [2] After hearing the oral arguments of learned counsels

appearing for both parties, considering the written submissions and perusing the cause papers filed herein, the Court dismissed the application with costs. Antecedent Facts [3] The antecedent facts are as follows: (a) The First Respondent is the Union representing the employees at the Applicants Club.


The Applicants club provides sporting activities, recreational facilities and social events for its members.


The applicant and the First Respondent entered into a Collective Agreement and both parties are bound by the terms of the said Collective Agreement.


The Applicant had incurred financial losses at its Food and Beverage Department (F&B Department) where as at 4.2.2004, the F&B Department had incurred losses of RM900,000 per annum. The Applicant further as at 4.2.2004 Hence, the its F&B incurred financial losses at its Golf Section in the Applicants Sports Department. Applicant decided to outsource

Department and computerize the Golf Section in the Applicants Sports Department. (e) As a result of the outsourcing of the F&B Department and computerizing of the Golf Section in the Applicants Sports Department, employees at both departments were made redundant.


Article 24 in the Collective Agreement between the Applicant and the First Respondent provided the terms to be followed by the Applicant if there arose retrenchment situation at the Applicants Club. Article 24 of the Collective Agreement, inter alia, reads as follows:

24. RETRENCHMENT 24.1 The provisions of this clause shall apply only to those employees of the Club who to are the declared Clubs redundant, i.e. whose services are surplus requirements. 24.2 The Club shall inform the Union no later than one (1) month prior to the date of notice on which the services of the employees concerned are to be terminated. 24.3 The Club shall notify the by



redundancy no less than two (2) months or pay in lieu of notice


prior to the date of termination of employment. (g) The Applicants vide its letter dated 27.1.2004, informed the First Respondent of its proposal to have a meeting on 4.2.2004 with the First Respondent to discuss about the Applicants operation mainly the Food & Beverage (F&B) Department and Sports Department. (h) During the meeting on 4.2.2004, the Applicant informed the First Respondent of its intention to retrench the employees in the two Departments. On the same date i.e. 4.2.2004, the Applicant issued a letter to the First Respondent informing of its intention to offer to the forty-seven employees the VSS/RET benefits.



On the same date i.e 4.2.2004, the Applicant also notified the employees vide Message to Employees and letter to employees of the offer of VSS to all employees in the F&B Department and sports and that their services will be terminated after they did not opt for VSS.


Thereafter, the First Respondent wrote a letter dated 5.2.2004 to the Applicant stating that the Applicant was in breach of the Collective Agreement and requested the Club to withdraw its letters and Message. The Applicant did not give any response to this letter. Thereafter, the First Respondent filed a complaint under section 56 of the Industrial Relations Act 1967 for non-compliance by the Applicant of clause 24.2 of the Collective Agreement between the Applicant and the First Respondent.



The learned Chairman of the Industrial Court sitting with Panel members under section 23 of the Industrial Act 1967, handed down Award No. 55 of 2007 on 10.1.2007 in favour of the First Respondent.

Ground of Challenge [4] The substance of the Applicant challenges is that the

Second Respondent had erred in law and/or acted beyond its jurisdiction when it decided that the Applicant had not complied with Article 24.2 of the Collective Agreement.


The Applicant submits that it had complied with Article

24.2 of the Collective Agreement between the Applicant and the First Respondent wherein on 4.2.2004 it informed the First Respondent at a meeting in respect of the Applicants intention to retrench employees at the F&B Department and the Golf Section at the Applicants Sports Department and had given the First Respondent the particulars of the number of employees involved. The Applicant contends that the effective date of termination was one month after this meeting where the Union was informed of the pending retrenchment. [6] According to learned counsel for the Applicant, the

Applicant subsequent to the meeting issued a message to all its employees at its F&B Department and the Golf Section at the Applicants Sports Department on 4.2.2004 wherein the employees were informed that the F&B Department operations will cease on 1.3.2004 and the Golf Section at the Applicants Sports Department had a surplus of five (5) employees. The Applicant further informed the employees that it was offering a Voluntary Separation Scheme (VSS) and in the event the employees did not wish to apply for the VSS, the Applicant then may have to retrench the employees concerned if the Applicant is unable to transfer the employees to other Departments at the Applicants Club or the Applicant is unable to offer any alternative employment at the Applicants club.


Further, the Applicant thereafter issued a Notice dated

9.2.2004 to the employees of the Applicant wherein they were notified in respect of job opportunities at three other employers. This was a general notification to the employees. On 16.2.2004, the Applicant issued a Notice to the employees in respect of the particulars of the termination benefits under the VSS and reminded the employees that the VSS was open for application till noon of 20.2.2004. The Applicant vide letters dated 4.2.2004 had offered VSS to its employees and later vide letters dated 27.2.2004, the Applicant accepted applications for VSS from its employees. The Applicant also vide a letter dated 23.2.2004 transferred an employee to another Department at the Applicants Club. The applicant submits that at this juncture there was no notice of termination of employment and the letters to the employees were offers VSS and as such there was no requirement to comply with Article 24.2 at that juncture. [8] The Applicant thereafter through a letter dated The

23.2.2004 and letters dated 29.2.2004 the Applicant had offered alternative employment to other employees. Applicant also via letters dated 27.2.2004 wrote to the employees affected by the retrenchment exercise informing them of their retrenchment and the reasons for such retrenchment with details of termination benefits pursuant to the Collective Agreement between the applicant and the First Respondent. The employees covered were expressly told that

although the date of termination was to take effect on 29.2.2004 they would be paid until 4.3.2004. that day by the Applicant. Impugned Award [9] After considering the totality of the facts, evidence and The last day for the employees retrenched was 4.3.2004 as they were paid until

submission of parties, the Second Respondent held that the First Respondent was informed for the first time of the Applicants intention to terminate the employees from the two Departments at the meeting held on 4.2.2004. [10] At page 279 of the Impugned Award, the Second

Respondent made the following findings of fact: After considering the evidence put forward during the hearing the Court is of view that the Club had not complied with clause 24.2. Evidence had shown that on the date the Club informed the Union of its intention to retrench the employees in the two Departments, the Club then proceeded to notify the employees about their pending retrenchment due to cessation of the operations in the Departments concerned as from 1.3.2004. What the Club had done was contrary to what has been provided for in clause 24.2 where the Club

has to inform the Union first. advance notice [11] stated:

Clause 24.2.

envisages the Club having to give the Union an

Further, at pages 295 296, the Impugned Award

When determining the complaint as to whether the Club had complied with clause 24.2 of the Collective Agreement, the relevant factors to be considered are as to when the Union was informed by Club about the Clubs intention to terminate the employees, and when was the date of the notice informing the employees of their retrenchment. And at page 298 of the Impugned Award, the Second Respondent made the following findings of fact: In the present case, it is clear that on the very day the Club informed the Union of its intention to retrench the employees, the Club then went ahead to notify the employees about their pending retrenchment. Also it is not a disputed fact that the employees were terminated as of 29.2.2004. In this circumstances, the Club cannot be said to have complied with clause 24.2 eventhough the

Club had make payment to the employees in respect of their salary until 4.3.2004. Findings of the Court [12] It is clear that the Applicants grounds of challenge

against the Impugned Award are a clear attack on the Second Respondents findings of fact. Although the decisions in the case of Syarikat Kenderaan Melayu Kelantan Bhd v Transport Workerss Union [1995] 2 MLJ 318; [1995] 2 CLJ 748; and R Ramachandran v The Industrial Court of Malaysia [1997] 1 CLJ 147 seem to provide potential for parties to reargue on the merits decision that have been adverse to them, but the Court of Appeal moved quickly in a series of later judgments to explain that the traditional supervisory role of the superior courts in judicial review proceedings had not, in any way, been abrogated and that the procedure should not be utilized as a cloak for what was essentially an appeal. For instance, the Court of Appeal in William Jacks v S Balasingham [1997] 3 AMR 2585, in relation to this issue, stated: It is well settled that a court cannot utilize certiorari proceedings as a cloak to entertain what, in truth, is an appeal against findings of fact. If authority is needed for that proposition, it may be found in the decision of the Indian Supreme Court

in Basappa v Nagappa AIR 1954 SC 440 and in Dharangadhra Chemical Works Ltd v State of Saurashtra & Others AIR 1957 SC 264. [13] Likewise, in Airspace Management Service Sdn Bhd v

Harbans Singh [2000] 4 CLJ 77, the Court of Appeal elaborated further, in relation to when the High Court was entitled to intervene, in a judicial review application, on the question of review of facts: The authorities therefore establish a clear

distinction between cases involving a review of facts as found by the Industrial Court based on the credibility of witnesses and those where no such exercise is involved. Cases where intervention has taken place, such as, Rama Chandran [supra] and those decisions that followed it fall into two categories. The first category comprises cases where what is undertaken is an objective assessment of the reasonableness of the Industrial Courts decision based on the facts as found by the Industrial Court. The second are cases where the Industrial Court failed to have regard to the issues raised by the parties or took into account some irrelevant consideration in arriving at its conclusion, apart from any specific findings of fact based on the credibility of

witnesses. But where the Industrial Court has accepted or rejected the evidence of a particular witness and gone on to make a finding based on such acceptance or rejection, the High Court is bound to accept such findings. (emphasis added) [14] Guidance on the approach which should be taken to the

interpretation of collective agreements can be found in the decision of the Court of Appeal for England and Wales in Adams & Others v British Airways plc [1996] IRLR 577. Here, at paragraphs 21/22 of the report, Sir Thomas Bingham MR said the following: The court is not concerned to investigate the subjective intentions of the parties to an argument (which may not have coincided anyway). Its task is to elicit the parties objective intentions from the language which they used. The starting point is that the parties meant what they said and said what they meant. But an agreement is not made in a vacuum and should not be construed as if it had been. Just as the true meaning and effect of a mediaeval charter may be heavily dependent on understanding the historical, geographical, social and legal background known to the parties at the time, so must a more modern instrument be

construed in its factual setting as known is clear beyond argument, the factual setting will have little or no bearing on construction; but to construe an agreement in its factual setting is a proper, because a common-sense, approach to construction, and it is not necessary to find an agreement ambiguous before following it. On the facts here, it was a collective agreement which was incorporated into the contracts of the individual plaintiffs. A collective agreement has special characteristics, being made between an employer or employers organisation on one side and a trade union or trade unions representative of employees on the other, usually following a negotiation. Thus it represents an industrial bargain, and probably represents a compromise between the conflicting aims of the parties, or sides as in this context they are revealingly called. But despite these special characteristics, a collective agreement must be construed like any other, giving a fair meaning to the words used in the factual context (known to the parties) which gave rise to the agreement. [15] It is now well established that the Courts should refrain

from substituting their own interpretation of a collective


agreement for that of the Industrial Court, and avoid intervening when the interpretation which the Industrial Court has given to the agreement is one which the wording of the agreement may reasonably bear and could be supported by the evidence. A Court may interfere with such interpretation and application only if such interpretation is absurd and the Industrial Court fails to take into consideration all the relevant facts in arriving at its conclusion. [16] In my considered opinion, the Second Respondent had

weighed and taken into consideration all relevant facts when it arrived at its findings of fact as stated in the Impugned Award above and the Court agrees with the conclusion reached by the Second Respondent. [17] The Applicant further submits that the Second

Respondent was in error for applying the ratio in Dunlop Industries Employees Union v Dunlop (M) Industries Bhd [1987] 1 CLJ 86 (Rep) [1987] 1 CLJ 232 as if the case was on all fours in the First Respondents case before it. According to the Applicant, the issue of advance notice is not envisaged by Article 24.2 of the Collective Agreement. [18] With respect, the Court disagrees. The facts and issue

in Dunlops case are somewhat similar to the current case. In Dunlops case, the Supreme Court was looking into Article 42(a) of the Collective Agreement which provided that the

Respondent would give such advance notice in writing of any redundancy or retrenchment but such notice shall not be less than two months prior to retrenchment. The Appellant received a letter at about 2.30 pm on June 24 1986 from the Respondent explaining the need to retrench some 114 employees who are members of the appellant due to sharp decline in its business, and after meeting between the parties, notices of retrenchment were issued at about 3.30 pm that very day to 112 employees. [19] The issue in Dunlops case was the failure of the

respondent to give requisite advance notice to the appellant as provided for in Article 42(a) of the Collective Agreement. In the Dunlops case it was held that: The right of the 1st Respondent to retrench employees is not disputed and the purpose of the advance notice in relation to any redundancy or retrenchment under Article 42(a) is to give time and make way for mutual consultation and negotiation to prevent a trade dispute from resulting. His Lordship Eusoffee Abdoolcader SCJ in his judgment held that:


Article 42(a) is clearly designed to facilitate mutual consultation and negotiation to avert retrenchment and would appear to be a corollary to give effect to the provisions of Clauses 20 and 21 of the Code of Conduct for Industrial Harmony which 30(5A). [20] Based on the foregoing reason, the Second Respondent the Industrial Court can take into consideration in making an award by virtue of s

in applying the Dunlops case did not take into account irrelevant considerations nor did it fail to take into account all relevant considerations. This is clearly evident at page 298 of the Impugned Award where the Industrial Court stated that: From what had been held by the Supreme Court (Dunlops case) that the Industrial Court could in the circumstances of the complaint of noncompliance make the order for the retrenched employees to be reinstated, it therefore can be said that the Supreme Court had agreed with the award of the Industrial Court that a case of noncompliance had been make out. [21] The Applicant contends that the Second Respondent in

ordering the Applicant to reinstate of the employees purported to be retrenched to any suitable position in the club without loss

of seniority or of pay had misconstrued and erroneously stated the intention, policy and scope of the Industrial Relations Act 1967. [22] With respect, it is trite that section 56(2)(b) of the

Industrial Relations Act 1967 empowers the Industrial Court to make such order as it deems fit to make proper rectification or restitutions for any contravention of any term of such award or collective agreement. It was held in Dunlops case [supra]: it is abundantly clear that the Industrial Court could in the circumstances of the complaint of non-compliance which is the subject matter of this appeal make the order that it did for the retrenched employees to be reinstated, and this order was properly made in accordance with the provisions of s. 56(2)(b) for the purposes of making proper rectification and restitution for a contravention agreement. [23] Further, section 30(6) confers upon the Industrial Court of a term of the collective

a certain degree of flexibility by allowing it to include the award any matter or thing which it thinks necessary or expedient for the purpose of settling the trade dispute or the reference to it under section 20(3). The Industrial Court is not restricted to the specific relief claimed or demanded by the disputants.


Learned counsel for the First Respondent informs the

Court that the employees remained ready and willing at all material times and still remain willing to make full repayment of the monies paid to them as termination benefits through deductions from their salaries. Alternatively, the employees are prepared to give written undertakings that the substantial gratuities due to them under their contract of employment upon their mandatory or early retirement to set-off against the monies paid to them. [25] The termination benefits given to the twenty (20)

employees was calculated in accordance with Article 23 (Separation Benefits) of the Collective Agreement pursuant to Article 24.4 of the Collective Agreement. There are five (5) employees who had applied for the separation benefits and had received the separation benefits from the Applicant whilst still in employment till this day (see Exhibit AS-3 at pages 26-32 of the First Respondent Further Affidavit). In the circumstances, learned counsel for the First Respondent contends that since the Applicant has allowed employees to apply for the separation benefits whilst still in employment, the twenty (20) employees who had received the termination benefits should be allowed to report back to work in accordance with the terms of the Award without the monies being refunded.


Conclusion [26] The Court is satisfied that the Impugned Award does not

suffer any infirmities of illegality, irrationality or procedural impropriety warranting intervention by this Court by way of juridical review. [27] Wherefore, the application is dismissed with costs. The

Impugned Award dated 10.1.2007 is affirmed. So ordered. Dated: 8 JULY 2010


For the Applicant

: Peter Chanther Jayaraja Messrs Ramadass & Associates Advocates & Solicitors Kuala Lumpur. : R Sivarasa Messrs Daim & Gamany Advocates & Solicitors Kuala Lumpur.

For the Respondent