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Objective:

To highlight the procedure for a fair and proper domestic inquiry as per requirements of law.

Why we go for domestic inquiry ?

In today’s context no employer can discharge or dismiss a delinquent workman even for a serious
misconduct without following an elaborate procedure for taking disciplinary action.

It is only when the workmen is found guilty of the charge in an inquiry conducted as per the principal of
natural justice, that the employer after following the procedure can punish him as per the company’s
standing orders.

Principal of natural justice :

q No man shall be the judge in his own cause
q Both sides shall be heard.

Rules of natural justice :

q The employee proceeded against had been informed clearly of the charges levelled against him.
q The witnesses are examined ordinarily in the presence of the employee in respect of the charges
q The employee is given fair opportunity to cross examine the witnesses
q The employee has been given reasonable opportunity to defend.

The Quick Take Playbook is designed to be both:

q A learning aid to be used in class
q A resource to be used after class
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Once management is in a position to fully consider all the relevant factors, then the appropriate
disciplinary action can be taken
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If dismissal is decided, the employee should be informed as soon as possible and also on what
grounds he is being dismissed

We explore workplace investigations, outlining a simple process to ensure consistent and effective fact
finding in your organisation. A workplace investigation is designed to find facts and determine what
happened or what is happening in a situation. An investigator for the organisation has the responsibility to
look beyond the simple incident or accusation to examine the situation as a whole. The initiation of an
investigation is almost always the result of a report or complaint. An individual or group has informed the
organisation that something is wrong. Treat every complaint as a gift. To best understand workplace
investigations, answer two questions: Why do organisations conduct workplace investigations and how do
they best do so? So, why conduct a workplace investigation? If you ask most professionals involved with
workplace investigations about its purpose, the answer you will likely hear is “to find the facts.” There are a
number of decision points in the process of workplace investigation. Those decision points represent the
process by which workplace investigations are best managed in organisations. Workplace investigations are
conducted to find facts and promote fairness in the workplace.

The Workplace Investigation Model allows any organisation to improve trust and realize better
results in your next employee relations issue.
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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.

The Federal Court in Said Dharmalingam Abdullah v Malayan Breweries (Malaya) Sdn. Bhd.113 – a case
involving an employee who was denied the opportunity to make a plea in mitigation before the domestic
inquiry –held that ‘it would have been a useless formality to have accorded the Employee the right to
make a plea in mitigation as the penalty would have been the same even if that right had been
exercised’. In other words, the denial of an opportunity to be heard seemed to occasion no prejudice to the
affected party since the employer would have no discretion but to dismiss. In particular, the Court observed:
‘In the present case, the misconduct proved against the Employee, was very grave indeed, involving the
element of dishonesty and a high degree of premeditation and preparation. The Employee must have been
aware, that in the event of an adverse finding on the issue of liability, dismissal would be a mandatory
sequel. Indeed, no other punishment was possible, given the circumstances of the case. Therefore, it is
submitted that the least expected of an employer is that, at the time of dismissal, the employer has
reasons for the said dismissal and the effected workers was given the necessary opportunity to
refute any allegation made against him.
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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.
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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.
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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.
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A charge sheet is issued when during the course of preliminary investigation, after receipt of the clarification
of the employee in reply to the show cause notice, the disciplinary authority arrives at the opinion that the
employee has committed a misconduct, as per the rules and procedure of the organisation.
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O.P. Malhotra in “The Law of Industrial Disputes” states :-

“…the charge-sheet is the charter of disciplinary action. The domestic inquiry commences with the
service of the charge-sheet. In other words before inquiry against an offending employee, he must be
informed clearly precisely and accurately of the charges levelled against him…otherwise it will amount to him
being condemned unheard.”
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“Though the claimant went through the domestic inquiry without complaining about the charge and had given
his evidence, and it was also the same during the proceeding before this court, it does not stop the court
from considering the validity of the charge when it was raised by counsel in the submissions.

The court having found the charge against the claimant is vague and thus a bad charge, therefore concludes
that it vitiates the domestic inquiry conducted by the bank… As such the dismissal of the claimant by the
bank is without just cause or excuse.”
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Domestic Inquiry Is Required By:-

q Statute - Section 14(1) of the Employment Act 1955

q Common Law - The rules of natural justice

before an employee can be punished for an act of misconduct

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DUE INQUIRY

q DUE INQUIRY also means DOMESTIC INQUIRY.

q It is a statutory requirement to hold a Domestic Inquiry – s14 of EA 1955.

q No specific rule on how a Domestic inquiry should be held?

q As such we need to look at Court

q Court’s decision in coming to a guideline.

q Courts advocates “natural justice ” as a rule on Domestic Inquiry.

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Courts defines two main rule in regards to “natural justice”…
a) Rules against bias – impartiality.
b) Right to be heard - fairness.

Simply means that the workman who is being charged for misconduct have:
1) Reasonable notice on the case he has to meet.
2) Reasonable opportunity of being heard in his defence.
3) The hearing must be impartial – panel of judges must not be directly or indirectly a party to the
case.
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Requirement of the panel

a) To write a Domestic Inquiry report based on the evidence produced before the panel.

b) To make clear & precise findings.

c) To give reasons for the findings.

d) To require conclusive proof of misconduct.

e) The application of the burden of proof in the Domestic Inquiry is not to be as rigid as the standard
set in the Criminal Court.

f) To demonstrate good faith and impartiality during the DI – in such a case the Industrial Court will
not normally interfere with the decision made by the Company.
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As you start to grow your business, your team will grow too. This leads to a likely possibility that you may
experience some unforeseen challenges with your employees that you will have to deal with. We are aware
that it can be important to manage these situations right away to maintain the smooth running’s of your
business. This can minimise the possibility of the problem escalating. This is why it is essential to have good
HR processes in place.

DI --The Role of Chairman

The Chairman
q To have overall control of the running of the inquiry.
q To ensure that the alleged employee understands the charge by reading and explaining its contents at
the start of the inquiry.
q To allow the prosecutor, the alleged employee or his union official to submit their evidence.
q To ensure that all witnesses are produced to testify in front of the Panel.
q To keep all records, evidence and exhibits adduced during the inquiry.
q To delegate specific duties to the panel members as he thinks fit in the conduct of the inquiry.
q At the end of the inquiry, he is to deliberate on the case with the panel members and form up a finding
and an opinion the together with the recommendation on the disciplinary action to be taken against the
alleged employee.
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DI --Role of Prosecuting Officer

q To submit his case to the Chairman.

q To produce his witnesses in front of the panel and submit produce evidence therefrom.

q To submit exhibits for the case.

q To allow his witnesses to be cross--examined by the alleged employee or his union official.

q To cross--examine witnesses produced by the alleged employee.

q To make his submission at the close of the inquiry as allowed by the Chairman. The union official
representing the alleged employee will assume the role similar to that of the Prosecuting Officer, except
that his role is to represent the alleged employee in making his defence.
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DI - Role of Witnesses

q The role for both the employer and the alleged employees witnesses testifying during the inquiry is to
answer questions as directed to them.

q They should state what they personally saw, or know about the case.

q They should not fabricate evidence for whatever reason.

q Their role is to tell the truth.

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DI --Role of Alleged Employee

q To be present in front of the Panel of Inquiry to defend himself.

q If he is represented by his union official, to allow him to question the witnesses.

q If he is not represented, to question the prosecution witnesses.

q If witnesses during cross--examination.

q To produce his witnesses in front of the Panel of Inquiry to defend himself.

q To make his submission at the close of the inquiry as his final defence.

q It is to be noted that, should the alleged employee be absent or fail to attend the domestic Inquiry after
being duly informed, without any reasonable excuse, the inquiry may proceed without him. Such an
inquiry is allowable and referred to as ex--parte inquiry.
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DI - Role of the Secretary

Normal proceeding in a DI, the Chairman / one of the panel members will write down all the proceedings
(notes of the inquiry) but as per our Banks practice this duty is passed on to the Secretary … role of the
secretary:

q To write down all proceedings (verbatim / typed), word for word, throughout the course of the Domestic
Inquiry.

q Passed on all the notes of the inquiry to the Chairman.

q To ensure that there is no dispute from the defence, the notes, should be counter signed by the alleged
employee.
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Burden of proof

In Stamford Executive Centre v. Puan Dharsini Ganesan (Award 263 of 1985) the Industrial Court observed:

“In a dismissal case the employer must produce convincing evidence that the workman committed the
offence or offence of the workman is alleged to have been committed for which he has been dismissed. …….
He must prove the workman guilty and it is not the workman who must prove himself not guilty. This is so
basic a principle of industrial jurisprudence that no employer is expected to come to this Court in ignorance
of it...”
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Findings & Punishment

q Findings to focus on the charges.

q Should not contain criticism of the Company’s systems or ways to improve

q Panel not to avail themselves of the past record of the employee at the time of passing judgment -
prejudicial information without any probative value

q Panel not to decide on the punishment to be imposed on the guilty employee.

Notes Of Inquiry

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.
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Effective discipline should be likened to what happens when you touch a hot stove

Predictable

Immediate

Consistent

Impersonal
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The general procedure at the inquiry would normally be as follows:
q 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.
q 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.
q 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 re-examination 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.

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.
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Procedure subsequent to inquiry

After the inquiry, the Chairman should discuss the case with the Panel Members and decide upon the merits
of the case.

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.

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.

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.

SECTION 20, IRA 1967

“It is well established and well known that for an employer to dismiss any workman, there must be just cause
or excuse. The just cause or excuse must be based on the facts of each case, either a misconduct,
negligence or poor performance. The onus is on the employer to prove just cause or excuse.”
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Industrial Court in Great Wall Shopping Sdn Bhd v Gan Shang Eng, 241/1988)

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What is the best idea you gained today that you will take action on in the next 30 days?

Your action plan

What you will:

1. Start doing?

2. Stop doing?

3. Continue doing?
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A professionally qualified accountant he was awarded with:

1988 Degree from the Institute of Chartered Secretaries and Administrators

(United Kingdom)

1991 Post Graduate Diploma in Hospital Administration from MPC International Houston,
Texas

2000 Awarded Associate member of Institute of Financial Accountants (United Kingdom)

2001 Certified Financial Planner (Financial Planning Association of Malaysia)

Next steps & implementation

Our programmes are completely customized and affordable. We coordinate your desired outcomes and
always exceed the client’s expectation by providing succinct, sustainable take home value.

Programmes & offerings include:

One on One’s
Corporate Retreats
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Organisational Development
Selection of new employees
360° Leadership Surveys
Employee Engagement or Climate Surveys
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Other topics of interest

Course Date Name

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