MANAGING DISCIPLINE &

DOMESTIC INQUIRY
 THE RIGHT TO DISCIPLINE PROBLEM EMPLOYEES
• In Goodyear Malaysia Bhd v National Union of Employees in Companies
Manufacturing Rubber Products (Awards 63 of 1986), the Industrial Court has
this to say:-

We are fully aware that discipline in industry is an absolute necessity for efficiency.
If every employee were to do only what he or she wants to do, the productive
process cannot be carried out effectively.

Such state of affairs would not only operate to the distinct disadvantage of the
employer, but also to that of the employees and their union.

This court therefore realizes that the right of the employer to discipline is an
indispensable prerequisite to the operation of a successful business.
MISCONDUCT
 DEFINITION OF MISCONDUCT
• Behavior of an employee which is in conflict with the express and implied terms of his contract of
employment
• There is no statutory definition of misconduct in Malaysia. However, Section 14(1) of the EA 1955
implies that it is “conduct by an employee that is inconsistent with the fulfillment of the express
or implied condition of his service”
• The Industrial Court has clarified what the term “misconduct” means in Holiday Inn v Elizabeth
Lee (Award 22 OF 1990)

“Now, the dictionary meanings of the word “misconduct” are “improper behavior, intentional
wrongdoing, or deliberate violation of a rule of standard of behavior”.

Insofar as the employment relationship is concerned, an employee has certain express or

implied obligations towards his employer.

Any conduct inconsistent with the faithful discharge of his duties, or any breach of the express
or implied duties of an employee towards his employer, unless it be a trifling nature, would
constitute an act of misconduct.
 BURDEN OF PROOF
• The burden is on the employer to
establish whether the employee has
committed a misconduct. In doing so,
the employer must act fairly and
reasonably.
• The misconduct must be established
on the basis of a fact rather than
assumption.
STANDARD OF PROOF
• The standard of proof required to
establish misconduct in on the
“balance of probabilities”. Balance of
probabilities means the party who the
legal of proof rests is entitled to a
verdict in his favor if he has
established some preponderance of
probability (i.e. greater weight of
evidence) in his favor.
• If the misconduct committed is
criminal in nature, the “standard of
proof is still on the balance of
probabilities”
 PROVOCATION OF
MISCONDUCT
In the event, an employee is provoked in committing a
misconduct, the penalty of dismissal may be
considered harsh and unfair.
• In Van Leer Sdn Bhd v Chee Kong (Award 342 of
1987), the Industrial Court held as follows:-
“Although contumacious and insolent acts towards a
superior are in proper circumstances misconduct, it is
against equity and good conscience to mete the
extreme penalty of punishment of dismissal when
such acts were provoked by the superior and that
employee is not evenhandedly punished. The Court is
therefore of the view that the Company should have
accepted the recommendation of its own panel of
inquiry and given the claimant (and, it should not be
said, the superior as well) a stern and final warning,
instead of dismissing him alone. The Court therefore
rules that the dismissal was without just cause or
excuse”
 • Condonation is a legal term
CONDONATION OF generally described as
permission granted to an
MISCONDUCT employee retroactively to cover
a prior misconduct or breach of
duty.

• The uniform rule that an

employer who continues to
keep an employee in
employment with full
knowledge that the latter had
committed a breach of duty
condones the breach, and such
waiver or retroactive
permission prevents the
employer from later punishing
the employee for it.
 PROCEDURE OF HANDLING A MISCONDUCT

1 • Appointment of Investigating Office

2 • Investigate any report or allegation of misconduct received

3 • Identifying and interviewing the relevant parties

4 • Collecting documents and exhibits to support the allegations of misconduct

5 • Preparation of Investigation Report

• If sufficient evidence obtained, prepare a show cause letter and proceed with
6 domestic inquiry
 IO MUST ESTABLISH THE FOLLOWING FACTS

Was a misconduct Who committed the When did the

committed? misconduct? misconduct occur?

What evidence is there to

show guilt of the employee
Where did the who has allegedly
misconduct committed? committed the misconduct?
(i.e.: witnesses, documents,
items)
 THE INVESTIGATION REPORT MUST CONSISTS OF

Description on how the Name and designation

Name and designation The allegation of
misconduct was of the accused
of the Complainant misconduct
committed employee

A name list of those

Recommendation if
parties who were A list of all
A summary of the there’s sufficient
interviewed and documentary evidence
evidence discovered evidence to initiate
enclosing a copy of the collected
disciplinary proceeding
Q&A, if any
DOMESTIC
INQUIRY
PROCEEDING
INITIATE DISCIPLINARY
PROCESS A show cause should consists:-
▪ The allegation of misconduct
stated clearly
▪ A reasonable dateline as to when
the employee must submit reply

Admit Guilty /
Preliminary
Show Explanation Satisfactory
Start Investigation to Punishment End
Cause
establish Prima / Case Close
Letter
Facie

Deny Allegation /
Explanation
Unsatisfactory

DI panels submit
Possible punishment following S.14, EA 1955 Domestic Recommended report
Punishment by DI Disciplinary
Inquiry Committee
S.14. Termination of contract tor special reasons Panel Members
(1) An employer may, on the grounds of misconduct
inconsistent with the fulfilment of the express or
implied conditions of his service, after due inquiry Appropriate punishment
meted out against
•(a) dismiss without notice the employee; employee
•(b) downgrade the employee; or
•(c) impose any other lesser punishment as he deems
just and fit, and where a punishment of suspension
without wages is imposed, it shall not exceed a period End
of two weeks.
 PREPARATION FOR A DOMESTIC INQUIRY

Appointment of Domestic Inquiry Panel

Appointment of a Prosecuting Officer

Appointment of a Recording Secretary

Arranging logistics

Preparing and issuing Notice of Domestic Inquiry

Informing complainant and witnesses to attend the

inquiry
 GUIDELINE BY INDUSTRIAL COURT

a) The inquiry is to instituted as early as possible after the

suspension of the employee;
b) The employee is to be given particulars of the misconduct,
preferably in writing, and a reasonable time before inquiry
to enable him to prepare his case;
c) Whenever applicable, the employee is to be accompanies
by his union or committee representative, it an, at the
inquiry;
d) The inquiry is to be conducted, as far as possible by such
officers that are not directly connected with the
investigation of the misconduct, so as to give the hearing
impartiality;
e) Examination of relevant witness is to be allowed at a
reasonable discretion of the officer in charge of the
inquiry; and
f) Notes in the form of question and answers and the final
decision are to be recorded to show that the inquiry was
proper, and that the decision arrived was fair.
COMMON QUERIES ON
DOMESTIC INQUIRY

1. What happens if the accused

employee is absent for the DI
proceeding?
2. Can the accused employee be
represented at the DI
proceeding?
3. What if the accused employee
refused to sign the verbatim
report?
PUNISHMENT/PENALTIES
OF MISCONDUCT
 FACTORS TO BE CONSIERED IN IMPOSING
TYPE OF PUNISHMENT
The Management’s
The length and quality The employee’s past own actions or
of the employee’s disciplinary records, if omission which
service any contributed to the
misconduct

The seriousness/gravity The employee’s good Past service award and

of the misconduct untainted record recognition
 TYPES OF PUNISHMENT

Verbal Written Suspension from

employment
Warning Warning without pay

Stoppage of
Downgrading/
increments / Dismissal
Demotion
bonuses
 ➢The accused employee should be given an
opportunity to appeal against the punishment
imposed.
➢The appeal should be made to the person higher
APPEAL than the punishing authority.

PROCEDURES ➢If the Human Resource Manager is the person

who decided the punishment, an appeal should
AGAINST THE be made to the Chief Executive Offiver (“CEO”)
➢If CEO is the person who decided on the
PUNISHMENT punishment, then the appeal should be made to
the Managing Director or Chairman of the Board
IMPOSED of Directors.

“Appeal procedure is not mandatory, but it is the

best practice to implement”
THANK YOU
Prepared by,
Naline Lokanathan, 2020

Sources:

• Training on Managing Discipline and Poor Performance

at Workplace by Kavitha Guna Segaran, March 2020
• E-laws