INDUSTRIAL COURT OF MALAYSIA

CASE NO: 7/4-231/16

BETWEEN

TAN CHEE TIAM

AND

SCHNEIDER ELECTRIC INDUSTRIES (M) SDN BHD

AWARD NO: 443 OF 2020

CORAM : Y.A. PUAN NOOR HAYATI BINTI HAJI MAT

- Chairman

VENUE : Industrial Court of Malaysia, Kuala Lumpur.

DATE OF : 06.01.2016.
REFERENCE

DATES OF : 23.03.2016, 05.05.2016, 09.06.2016, 20.07.2016,

MENTION 09.08.2016, 08.09.2016, 04.10.2016, 16.08.2017,
13.09.2017, 16.10.2017, 23.10.2017, 27.11.2017,
14.08.2018, 11.02.2019 & 29.10.2019.

DATES OF : 06.11.2017, 22.03.2018, 02.10.2018, 03.10.2018,

HEARING 12.11.2018, 13.11.2018, 22.11.2018, 29.01.2019,
30.01.2019, 17.05.2019, 04.07.2019, 05.07.2019,
01.08.2019 & 10.09.2019.

REPRESENTATION : Mr. Kam Booi Keong together with Ms. Siti Nur
Amanda from Messrs Yunus Ali & Kam
(Counsel for the Claimant)

Ms. Chew Kherk Ying together with Mr. Raymond

Tan from Messrs Wong & Partners.
(Counsel for the Company)

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THE REFERENCE

This is an order of reference dated 6 January 2016 by the Honorable

Minister of Human Resources pursuant to section 20(3) of the Industrial

Relations Act 1967 arising out of the dismissal of Tan Chee Tiam

(“Claimant”) by Schneider Electric Industries (M) Sdn Bhd

(“Company”) on 21 May 2015.

AWARD

1. The Ministerial Reference in this case required the Court to hear

and determine the Claimant’s dismissal by the Company on 21 May

2015.

2. The parties in this matter filed their respective written submissions

and submissions in reply on 10 October 2019 and 29 October 2019.

3. This Court considered all the notes of proceedings in this matter,

documents and the cause papers in handing down this Award namely: -

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 (i) The Claimant’s Amended Statement of Case received on 21

September 2017;

(ii) The Company’s Amended Statement in Reply received on 6

October 2017;

(iii) The Claimant’s Amended Rejoinder received on 16 October

2017;

(iv) The Claimant’s Bundle of Document – CLB, CLB1, CLB2,

CLB3 and CLB4;

(v) The Company’s Bundle of Documents –COB and COB1;

(vi) Claimant’s Witness Statement – CLWS1 and CLWS2; and

(vii) Company’s Witness Statements – COWS1A&B, COWS2,

COWS3 and COWS4A&B.

4. Albeit the above, this Court also took into considerations all

issues raised thoroughly by both parties in the course of the examination

of all witnesses especially COW1, Therese Leong (hereinafter referred

to as “Ms. Therese”) although not mentioned specifically in detail in this

Award.

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BRIEF FACTS

5. Tan Chee Tiam, the Claimant in this case commenced

employment with Schneider Electric Industries (M) Sdn Bhd, the

Company, on 10 March 2008 as a Senior Account Manager pursuant to

the Company’s acquisition of Clipsal Group of Companies, in which the

Claimant had been employed since 2 May 2005. The Claimant last

drawn salary before his dismissal was RM6,378.00 per month excluding

the allowances.

6. The Company is in business of providing energy management

and automation solutions to its customers via the Company’s product,

such as hardware appliances, software programs and other services.

7. The role of the Claimant as Account Manager includes (as

explained in CLWS1A):

1. Meeting the sales target of the Company’s products;

2. Building and managing relationship with contractors,

consultants, direct partners and end users;

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 3. Demonstrating and explaining the Company’s products to

customers so that the customers understand the value

proposition of the product and procure it;

4. Converting opportunities into orders and sales; and

5. Collecting market data and reporting available opportunities

to the Company.

8. By letter dated 21 May 2019, the Claimant was dismissed from

his employment on the grounds of gross non-performance. The

Claimant however denies the allegations stated in the said letter and

now comes before this Court to aver that his dismissal from employment

was unfair, unjust, without just cause or excuse, actuated with mala fide

and was contrary to the principles of equity, good conscience and

natural justice. He prayed to be reinstate to his former position without

loss of seniority, wages or benefits, monetary or otherwise.

Evidence

9. It was the Company’s pleaded case that the Claimant had

displayed poor work performance since 2011 and failed to achieve the

sales target and work goals set by the Company. The Claimant was

considered as an average performer with overall ratings of two (2) out of

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five (5) (not meeting the expectation of the Company). As a Senior

Account Manager, the Claimant’s primary task is to secure sales for the

Company and yet his individual sales performance was allegedly

declining over the years.

10. Be that as it may, to assist the Claimant achieving his targets, the

Company had reduced his sales target from RM3 million in 2012 to RM2

million in 2013. Unfortunately, the Claimant’s work performance

continues declining until 2014. The Company avers that the Claimant

portrayed his reluctance to improve and in addition failed to manage his

daily duties diligently. Aside the Claimant was unable to meet his sales

targets, the Company contends that he had constantly gave excuses

and kept blaming the Company’s product being too highly prices as

compared to other competitors to justify his unsatisfactory performance.

11. Due to his continuous failure to meet the targets, the Claimant

was placed under the Company’s Performance Improvement Plan (PIP)

twice from 29 May 2014 until 31 December 2014 (the first PIP) and from

29 January 2015 until 28 April 2015 (the second PIP). However, the

Claimant allegedly failed to improve and repeated his failures to achieve

the percentage required to his set sales target. The Company further

states that notwithstanding the support and guidance provided by the

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Claimant’s supervisor, Ms. Therese, not only his performance not

improving but was unnecessarily being abusive and made derogatory

remarks towards his supervisor instead.

12. The Company avers that the Claimant was given ample

opportunity and sufficient time to improve his work performance with

proper support and guidance but unfortunately failed to improve which

then resulted in the Company terminating his employment.

13. The Company states that the other employee which had less

experience managed to achieve a total sale of RM2.5 million within six

(6) months and had performed significantly better than the Claimant who

had almost 10 years of sales experience. Therefore, the Company

pleads that the Claimant’s termination was bona fide and with just cause

or excuse.

14. The Claimant states in his evidence that he had worked under

several superiors and commencing from 1 October 2013, he was put

under direct supervision of Ms. Therese, as his immediate superior.

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15. The Claimant avers that in October 2013, he had to seek

approval from the Country President for a special price agreement for

one BIOCON Ltd Facilities Centre project in Nusajaya, Johor as he

alleged that Ms. Therese failed to support him in giving fast approval to

meet the customer’s dateline. In another word, the Claimant had to by-

pass Ms. Therese to get the approval (from the Country President) and

due to this incident, the Claimant alleged that Ms. Therese felt offended

and assumed that she had personal grudge against him. This, however

was denied by Ms. Therese in her evidence.

16. Subsequently, the Claimant states that he was then subjected to

humiliation, unfair treatments, harassment and victimization by Ms.

Therese in respect of the annual e-learning training and she purposely

makes statement in a meeting down grading the Claimant by negatively

comparing his performance with a junior employee.

17. In furtherance to that, the Claimant had written an official Letter of

Grievance on 9 April 2014 to HR Department but to his surprise, the

Claimant instead, was placed under a Performance Improvement Plan

(PIP) shortly after the delivery of the letter. Thus, the Claimant claims

that he was put under PIP as retaliation by the Company due to the

Claimant’s letter of grievance against Ms. Therese.

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18. The Claimant further explained that his annual performance

appraisal for 2013 was rated ‘2’ due to two (2) of the Claimant’s major

customers, ECS Pericomp Sdn Bhd and Oceanmax Datacomms Sdn

Bhd had cancelled their order and not because of his non-performance

issue.

19. On the two (2) PIPs, the Claimant pleads as at paragraph 21 of

the Statement of Case as follows:

(A) For the first PIP (for the duration from 29.5.2014 to

29.12.2014)

(i) No regular meetings were held to review and follow up

on the Claimant’s progress;

(ii) Failed to take into consideration the impact on the

Claimant due to the loss of confidence of the Claimant’s

two major customers namely ECS Pericomp Sdn Bhd

and Oceanmax Datacomms Sdn Bhd who had to

cancelled their order placed with the Company (as set

out in paragraph 18 above) and sourced for substitute

from other suppliers to fulfill the order placed by their

clients due to the Company’s inability to deliver the

product as ordered by ECS Pericomp Sdn Bhd and

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 Oceanmax Datacomms Sdn Bhd caused by the

Company’s internal problem;

(iii) Did not take into consideration, the Company’s internal

problem which caused the cancellation of orders by the

Claimant’s customer, AWS Sdn Bhd’s Purchase Order

AWS/PO/13435 dated 30.08.2013 amounting

RM156,900.00 which was cancelled on 24.07.2014;

(iv) Failed to take into consideration the Purchase Order

amounting RM1,078,628.00 issued by ADV Sdn Bhd

PO. ADV4775 dated 19.9.2014 being an account service

by the Claimant;

(v) Failed to provide the necessary support resulting in the

Claimant not able to secure the Sunway University

Project value at RM512,127.00;

(B) For the second PIP (for the duration from 29.1.2015 to

28.4.2015)

(i) The second PIP was terminated prematurely by Therese

Leong on 14.4.2015 before the completion of the second

PIP on 28.4.2015;

(ii) Therese Leong had rated the performance of the

Claimant for the second PIP on 14.4.2015 before the

completion of the second PIP on 28.4.2015;

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 (iii) Objective 2 of the second PIP was inaccurately and

inconsistently rated;

(iv) Failed to take into consideration, purchase orders

secured by the Claimant but not captured as sale for the

duration of the second PIP due to the Company’s

internal problem for the following customers :-

(a) Purchase Order PO-00048 dated 30.03.2015

amounting RM340,998.96 issued by Oceanmax

Datacomms Sdn Bhd for Alila Bangsar Hotel

Project; and

(b) Purchase Order AWS/PO/13937 dated 31.03.2015

amounting RM315,000.00 issued by AWS Sdn Bhd.

20. In response to the Claimant’s averment, the Company replied that

both the PIPs were introduced due to the Claimant continuous failure to

perform and not achieving his sales target. Extracted from the evidence

of Ms. Therese, the Company further states that she had held regular

meetings with the Claimant and attended to him whenever he needed

pricing support. As for the two (2) major customers mentioned (ECS

Pericomp Sdn Bhd and Oceanmax Datacomms) the Company denied

the Claimant’s allegations that both customer had lost confidence with

the Company due to the Company’s failure to deliver the product. Ms.

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Therese further states in her evidence that both companies had made

numerous purchases after the above said cancellations. In response to

this, the Claimant states that both the Companies in actual fact are

“buying less”.

21. With regards the ADV Sdn Bhd accounts, the Company avers

that it was not serviced by the Claimant but by another employee and

the Claimant was full aware of that fact and this was never raised with

the management when the sales amount was not included as his sales

achievement. The Company explained that the ADV account was

handled by the Claimant’s Manager in 2013, Jason Goh after which Ms.

Therese took over and it was not disputed that she has the discretion to

whom the account can be transferred. Ms. Therese testified that she’d

never passed the ADV account to the Claimant and as admitted by the

Claimant, it was given to Vincent Teng.

22. The Claimant however, maintained his averment and states that

this account was parked under him and serviced by him although

admitted that it was originally parked under and services by Vincent

Teng. The Claimant further explained that after Vincent left the

Company in August 2014, he was the only sales personnel in his

12
department and because of that, the sales for ADV account was solely

handled by the Claimant between August to November 2014.

23. Finding it intolerable, the Company terminated the Claimant on

the grounds of gross non-performance as stated in the termination letter

dated 21 May 2015. A copy of the said letter is now reproduced below

for ease of reference.

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24. It was submitted by the Claimant that the termination on the

above stated grounds therein was made without just cause or excuse

and actuated with mala fide on the following reasons:

i. The First PIP (from 29.5.2014 – 31.12.2014) was null and

void;

ii. The Second PIP (from 29.1.2015 to 28.4.2015) was null and

void;

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 iii. Condonation by the Company for not imposing PIP on the

Claimant in 2013 even though the Claimant only achieved a

performance rating of ‘2’ for not meeting performance goals;

iv. The termination of the Claimant’s employment had failed to

comply with the terms and condition for termination as

provided in the Claimant’s Letter of Appointment dated

20.1.2008 and is actuated with bad faith; and

v. The Company failed to provide the necessary support to the

Claimant by not approving pricing of product sold by

Claimant which are market competitive.

25. The Claimant contends that both the PIPs were null and void

based on the fact that it had failed to follow the Company’s own PIP

procedures in the Company’s policy as there were no monthly review

meetings held, no review document given to the Claimant and no

documented minutes of the relevant monthly periodic review meeting

which are supposed to be held.

26. The Claimant also submits that the Company had failed to

consider the fact that two (2) major clients of the Company, being the

Claimant’s customer, had cancelled their order due to the Company’s

internal problem in failure to deliver the product in time. This issue,

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according to the Claimant, had nothing to do with the Claimant’s ability

to secure orders.

27. The issue before this Court now is whether the dismissal on the

grounds of poor performance meted out against the Claimant was

justified as just cause and excuse.

The General Law

28. The role of the Industrial Court under section 20 of the Industrial

Relations Act 1967 is succinctly explained in the case Milan Auto Sdn.

Bhd. v. Wong Seh Yen [1995] 4 CLJ 449, his Lordship Justice Tan Sri

Dato’ Haji Mohd Azmi bin Dato’ Haji Kamaruddin, FCJ delivering the

judgment of the Federal Court had the occasion to state the following:

“As pointed out by this Court recently in Wong Yuen Hock v. Syarikat

Hong Leong Assurance Sdn. Bhd. & Another Appeal [1995] 3 CLJ

344; [1995] 2 MLJ 753, the function of the Industrial Court in dismissal

cases on a reference under s.20 is two-fold firstly, to determine whether

the misconduct complained of by the employer has been established,

and secondly whether the proven misconduct constitutes just cause or

16
 excuse for the dismissal. Failure to determine these issues on the merits

would be a jurisdictional error ...”

29. In the case of K A Sanduran Nehru Ratnam v. I-Berhad [2007]

1 CLJ 347 the Federal Court again reiterated the function of the

Industrial Court:-

“The main and only function of the Industrial Court in dealing with a

reference under s.20 of the Industrial Relations Act 1967 is to determine

whether the misconduct or irregularities complained of by the

management as to the grounds of dismissal were in fact committed by

the workman. If so, whether such grounds constitute just cause and

excuse for the dismissal.”

The Burden of Proof

30. Whenever the Company caused the dismissal of the workman, it

is the Company that must now discharge the burden of proof that the

dismissal is with just cause or excuse.

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31. This long settled principle was demonstrated in the case of Ireka

Construction Berhad v. Chantiravathan a/l Subramaniam James

[1995] 2 ILR 11 where the Court opined that:

“It is a basic principle of industrial jurisprudence that in a dismissal

case the employer must produce convincing evidence that the workman

committed the offence or offences the workman is alleged to have

committed for which he has been dismissed. The burden of proof lies on

the employer to prove that he has just cause and excuse for taking the

decision to impose the disciplinary measure of dismissal upon the

employee. The just cause must be, either a misconduct, negligence or

poor performance based on the facts of the case.”

The Standard of Proof

32. In the case of Telekom Malaysia Kawasan Utara v. Krishnan

Kutty Sanguni Nair & Anor [2002] 3 CLJ 314 the Court made it clear

that the standard of proof that is required is one that is on the balance of

probabilities:

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 “Thus in hearing a claim of unjust dismissal, where the employee was

dismissed on the basis of an alleged criminal offence such as theft of

company property, the Industrial Court is not required to be satisfied

beyond a reasonable doubt that such an offence was committed. The

standard of proof applicable is the civil standard, ie, proof on a balance

of probabilities which is flexible so that the degree of probability

required is proportionate to the nature and gravity of the issue.”

33. As a Court of arbitration, Section 30(5) of the Act requires the

Court to decide a case in accordance with equity and good conscience.

It was held in the case of Harris Solid States (M) Sdn Bhd & Ors v.

Bruno Gentil Pereira & Ors (1996) 4 CLJ 747 where the Court of

Appeal had stated that it is incumbent upon the court to have regard to

substantial merits of the case rather than to technicalities.

Evaluations and Findings

34. In order to justify the dismissal of the Claimant on the ground of

poor performance, the Company has to establish that the Claimant was

warned about his performance, that he was accorded sufficient

opportunity to improve and notwithstanding the aforementioned and the

Claimant failed to sufficiently improve his performance. See the case of

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Ireka Construction Berhad, supra and United Plantation v Ahmed

Zaini (1996) ILR 632.

35. It is pertinent to note that the Company need not prove that the

Claimant was in fact incapable or incompetent but sufficient enough if

the Company honestly believes on reasonable grounds that the

Claimant is incapable or incompetent. This was dictated by the

Industrial Court in the case of Choong Poh Ling v CIMB Aviva

Assurance Berhad (2016) 2 LNS 1032 quoting Lord Denning MR in

the case of Alidair LTD v Taylor (1978) LCR 445 as follows:

“whenever a man is dismissed for incapacity or incompetence it is

sufficient that the employer honestly believes on reasonable grounds

that the man is incapable or incompetent. It is not necessary for the

employer to prove that he is in fact incapable or incompetent.”

36. Poor performance is not misconduct per se. In the case of

Eruthiam Arokiasamy v BM Enterprise Sdn Bhd (Award No. 622 of

2006) [2006] 2 ILR 852 the Court states that:

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 “...based on the sole ground given in the Termination Letter, namely

“due to your work attitude or lackadaisical attitude,” the Claimant had

not committed any misconduct to justify a dismissal. A workman who

does not show enough care or enthusiasm in his work but nonetheless

plods on with the work does not necessarily commit misconduct.”

37. Undisputedly, it was the Claimant’s main obligation towards the

Company to make sales to a certain amount set by the Company every

year. This Court appreciate the fact that whilst the Company do have

legitimate and reasonable expectation that the Claimant, as their

employee to be able to perform his task in meeting the sales target,

however whether the Claimant is a poor performer or otherwise is a

very subjective matter to be considered. The Company needs to show

evidence on a balance of probabilities and not mere allegation that the

termination is justified on the grounds of poor performance.

38. This Court took into consideration the reasoning and factors

explained by the Claimant for his failure to reach his targets which was

allegedly due to and partially contributed by the Company’s internal

problem that had resulted in the major clients, of which were the

Claimant’s customer, to cancel their orders.

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39. From the evidence tendered, the Claimant was undisputedly

under supervision of the Company since 2013 and from the annual

performance appraisal, the Claimant received a rating of ‘2’ which

positioned him as an average performer whom require guidance and

support in improving his performance to meet the minimum expectation.

40. It is an established principle of industrial law that an employer

cannot dismiss an employee who is not performing satisfactorily without

first informing him of the mistakes he is alleged to have made.

According to the High Court’s case of Lim Cheng Hoe v YB Menteri

Sumber Manusia Malaysia & Anor [2012] MLJU 397 the Court held

that the employer would need to adhere to the following requirements

before it can terminate its employee for poor performance:-

(i) The employee was warned about his poor performance;

(ii) The employee was accorded sufficient opportunity to

improve, and

(iii) Notwithstanding the above, the employee failed to

sufficiently improve the performance.

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41. In S. James v Waltham Holy Cross UDC [1973] IRLR 202,

204, Sir John Donaldson observed that:-

“An employer should be very slow to dismiss an employee upon the

ground that the employee is incapable of performing the work which he

is employed to do, without first telling the employee of the aspects in

which he is failing to do his job adequately, warning him of the

possibility or likelihood of dismissal on this ground and giving him an

opportunity of improving his performance”.

42. This was also reiterated in the case of Rohimi Yusoff v. Alfa

Meli Marketing Sdn Bhd & Anor [2001] 6 CLJ 177, High Court , Kuala

Lumpur, Faiza Tamby Chik J made an observation of IE Project Sdn

Bhd v. Tan Lee Seng (Award No. 56/198):

“An employer should be very slow to dismiss upon the ground that the

employee is found to be unsatisfactory in his performance or incapable

of performing the work which he is employed to do without first telling

the employee of the respects in which he is failing to do his job

adequately, warning him of the possibility or likelihood of dismissal on

this ground and giving him an opportunity of improving his

performance. It is for the employer to find out from the employee why he

23
 is performing unsatisfactorily or warn him that if he persists in doing so

he may have to go. There is no record of any such warnings. On the

contrary I am satisfied that the Claimant had performed his task to the

best of his ability.”

43. The Claimant was placed under a PIP and this was within his

knowledge as it was conveyed to him vide letter dated 29 May 2014.

When an employee was selected to go through a PIP process, it is

regarded as an indication and the Claimant was put on notice that

significant improvement is required in areas of concern as his

performance was at the unsatisfactory level.

44. Some sort of monitoring was done by the Company, be it through

meetings, discussion or even by unofficial communication and

interactions which can be construed as periodic review as part of the

PIP process. The extension of the first PIP on 29 January 2015 was

also after due consideration and discussion by both parties as reflected

in the Company email at page 3 of CL15.

45. This Court is of the view that the Claimant was adequately

informed of his lacking and the Company had given him the opportunity

to improve himself. An actual warning letter is not required as what is

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important is the areas of concern of the Company had been conveyed

to the Claimant and he was fully aware of the concerns which require

his improvement.

46. The Claimant was not achieving his sales target since 2010, as

submitted by the Company of which, the Claimant contends

condonation on the part of the Company for not initiating a PIP process

against the Claimant then and cited the case of Ranjit Kaur a/p S.

Gopal Singh v Hotel Excelsior (M) Sdn Bhd (2009) 5 MLJ 770 stating

that the doctrine of condonation is often associated and designated as a

waiver in which the Company choose to ignore the Claimant non-

performance prior to 2013.

47. Unfortunately, this was not pleaded in the Claimant’s Amended

Statement of case. Citing the same case of Ranjit’s Kaur, this Court is

of the view that parties are still bound by its pleading be it in the

Industrial Court or the Civil Court. But then, even if this Court were to

consider, the Company had sufficiently adduced evidence that though

the Clamant was not placed in a PIP process then, he was constantly

reminded and highlighted of his short comings in terms of his

performance from the overall ratings given in his annual appraisal

review. Not achieving the sales target might not be a disputed issue,

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however, whether the Company had sufficiently considered his

explanations during the PIPs to justify his inability to achieve it would be

the paramount reason to see whether the decision was made in good

faith.

48. The sole issue before this Court in this case is purely on poor

performance and terminating an employee with cause for poor

performance requires diligence from the employer. Performance inquiry

(the annual performance appraisal and the PIPs) by the Company must

be non-punitive in its intention and must be administered consistently to

all employees.

49. Notably, in pursuing to achieve sales target, it does involve other

unforeseen situations or events which some time are beyond the control

of the Claimant as sales person. This Court finds that the Claimant,

from the record, although failed to achieve targets set by the Company

since 2010, it would be unfair to be considered out right incompetence if

he is unable to procure the required amount within a particular period if

proven the existence of internal problems on the part of the company

which contributed to the declining amount in the total sales projected for

the Claimant.

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50. To justify termination for just cause based on poor performance,

the Company must establish a bar of incompetence. Incompetence is

defined as an inability to perform basic work functions as required by the

employer. In Boulet v. Federated Co-operative Ltd which is a leading

Canadian authority regarding the factors that courts will consider in

assessing whether an employer had just cause to terminate based on

poor performance, are summarized below on the leading principles in

managing poor performance:

- The performance of the employee must be gauged against an

objective standard.

- The employer established the levels of performance required,

the standard was communicated and understood by the

employee, suitable instruction and/or supervision was provided,

the employee was incapable of meeting the standard, and the

employee was warned that failure to meet standards would end in

termination.

- To determine if the number and nature of warnings for repeated

poor performance are adequate, the employer must show that, it

established a reasonable objective standard of performance, the

employee failed to meet the standard, the employee

had warnings that failure to meet standards would place his/her

27
 position in jeopardy, and the employee had been given

appropriate time to improve.

- Employers who condone an inadequate level of performance

(don’t perform performance appraisal) may not later rely on any

condoned behaviour as grounds for dismissal.

- Condoned behaviour is relevant if the employee fails to respond

after appropriate warnings.

51. Having that in mind, although this Court finds that the Company

had consistently informed the Claimant in the years of his declining

performance and had established that the concern was properly

addressed and communicated to the Claimant with various supports and

guidance provided by his supervisor, this Court is of the opinion that his

declining performance does not justify him being incompetent that

warrants the ultimate punishment of an immediate dismissal.

52. The Claimant pleads that the termination was actuated with mala

fide for failure to comply with his letter of appointment which requires

notice to be given unless the termination was due to gross misconduct of

any kind. The Claimant submits that even if there was gross non-

performance after completion of the relevant PIP period, it is not a

misconduct that warrant immediate dismissal. Base on the foregoing,

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this Court finds that mere non-performance cannot be construed as

gross misconduct of any kind, thus the termination, though not actuated

with mala fide but to a certain extent, was wrongful.

53. In conclusion, terminating an employee for cause due to poor

performance is possible. However, if terminating the Claimant for poor

performance is the desired outcome of the Company performance

management process, then the process must be constructive, supportive

and non-disciplinary in its’ origin. The Company performance

management process (PIPs and annual performance appraisal) must be

administered equitably and consistently over the life of an employment

relationship. This Court however reiterate that poor performance is not

misconduct per se as stated earlier thus the Company should have

resorted to other less severe punishment options in making a decision

against the Claimant unsatisfactory performance.

54. Therefore, based on the totality of the evidence adduced by both

parties as well as submissions made, and considering equity and good

conscience as well as on the substantial merits of the case without

regard to technicalities and legal form as stated in s.30(5) IRA, this

Court finds that the Company had failed to prove, on the balance of

probabilities that the dismissal was with just cause and excuse. The

29
termination, not only without just cause and excuse but also wrongly

administered in accordance with the appointment letter as pointed out by

the Claimant. Accordingly, the Claimant’s claim is hereby allowed.

Remedy

55. As for the relief sought, since the Court finds that the termination

was without just cause or excuse, this Court now order that the

Claimant be reinstated to his former position by the Company.

Back Wages

56. This Court is mindful of the Second Schedule to the Act which

provides that back wages may be ordered from the date of dismissal

based on the last drawn salary but subject to a maximum of 24 months.

The Claimant was dismissed on 21 May 2015 and thus entitled for the

maximum of 24 months back wages till the date of this Award amounting

to RM153,072.00 (RM6,378.00 x 24), subject to the following rescaling.

30
Rescaling of Compensation

57. In exercising its discretion, this Court had considered that

rescaling of the monetary Award ordered above is necessary as, to a

certain extent, it was the Claimant’s contributory conduct which has led

somehow or rather to his dismissal. The sales target set by the

Company is within the prerogative of the Company. As the sales

personnel, the Claimant ought to comply with the target although not

achieving it, with reasonable justification, does not fall under the

definition of misconduct which warrant a dismissal. But this had caused,

to some extent, losses to the Company. Under the circumstances and

in view of the Claimant contributory conduct, this Court sees fit to

rescale downward the Award for back wages to the extent of 30%.

The calculation

Back wages

RM6,378.00 x 24 months = RM153,072.00

30% = RM45,921.60

Total: RM153,072.00 - RM45,921.60= RM107,150.40

Total = RM107,150.40

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Final Order

58. The Claimant to be reinstated to his former position in the

Company and awarded a total of RM107,150.40 being back wages

scaled down by 30%, less statutory deduction (if any) to be paid to the

Claimant (and reinstatement) by the Company within 30 days from the

date of this Award.

HANDED DOWN AND DATED THIS ON 20th FEBRUARY 2020.

-signed-

(NOOR HAYATI BINTI HAJI MAT)

CHAIRMAN
INDUSTRIAL COURT OF MALAYSIA
KUALA LUMPUR

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