Case Spotlight: Abuse of Sick Leave?

At what point can an employer credibly accuse an employee of abusing sick leave, especially if a medical certificate confirms the employee’s illness? In Jolene Lee Miao Chi v Iflix Sdn Bhd [2021] ILJU 23, an employee was dismissed for allegedly abusing her sick leave. However, the employee succeeded in her claim for unfair dismissal at the Industrial Court, with the decision also upheld in the High Court (Iflix Sdn Bhd v Jolene Lee Miao Chi [2022] MLJU 630).


Brief Facts

  • The Employee was feeling ill and visited a clinic for a medical evaluation. The doctor issued a medical certificate (“MC”) confirming that she was not fit to work. 
  • The Employee had initially registered to attend a seminar on intellectual property on the same day. After leaving the clinic, the Employee decided to drop by the seminar venue to pick up the seminar notes since the venue was close to the clinic and her parents’ home where she was intending to rest.
  • The next day, the Employee was served with a notice requiring her to attend a disciplinary investigation meeting. The Company alleged that the Employee:
    • lied about being sick, and had abused her medical leave to attend the seminar; and
    • neglected her work responsibilities, using illness as an excuse.
  • After the disciplinary meeting,  the Company dismissed the Employee.

Courts’ Findings

The Industrial Court found that the dismissal was unfair, and was without just cause and excuse:

  • The MC showed that the Employee was not lying about being sick. As the Company chose not to challenge the authenticity of the MC, the Industrial Court found this is proof that the Claimant was unfit for the proper performance of her duties. However, just because she was ill, does not also mean she must be confined to her bed. The Industrial Court held that it was acceptable for the Claimant to “perform some light activities that does not exert much stress … the Claimant’s presence in the [seminar] just to pick up the seminar notes cannot be taken to mean that the Claimant was lying about her sickness for that day…”
  • The Industrial Court viewed that picking up notes from the seminar was reasonable because it was neither physically nor mentally tiring. It also noted the Employee’s evidence that going to the seminar venue only required a 1-minute detour. 
  • There was no evidence to show that the Employee had used her sick leave or the MC to avoid meeting her work deadlines. As the Employee had a valid MC that was not rebutted by the Company, the allegation she was deliberately failing to complete her work by the deadline was an unwarranted and unproven allegation.
  • Procedurally, the Industrial Court also had concerns about how the Company carried out its alleged investigation. For example:
  • The day after the MC, the Employee was suspended from work the moment the show cause letter was handed to her and placed under “humiliating circumstances” by visiting her at her home and “totally [cutting her off] from the office”.  Despite suspending her, a week later, the Company also charged her with not obtaining a MC for the second day of illness. The Claimant had no idea she had to submit a MC for the period in which she was suspended.
  • The “inquiry” (or disciplinary meeting as it was referred to by the Company) consisted of (i) the employee’s immediate superior, who had made various allegations against the employee, and (ii) the investigating officer, who had delivered the show cause letter to the employee. The Industrial Court observed that including these two personnel in the inquiry was “undesirable”, and that the inquiry ‘panel’ failed to adhere and act under the rules of natural justice as they infringed on the Employee’s right to put forth her answers and explanation to the charges.
  • There was no evidence to properly challenge the Employee’s evidence that she had gone to pick up the seminar notes and did not sit through the whole seminar. The Company instead relied on “flimsy and unsubstantiated materials like the attendance sheet containing the Claimant’s name for the seminar to conclude the Claimant attended the seminar.”
  • The High Court refused to quash the Industrial Court’s award, as it was not tainted with illegality, irrationality or procedural impropriety.

Key Takeaways

An employee may have paid sick leave either under their employment contract or under the Employment Act 1955 (if applicable).  To utilise paid sick leave, the employee will usually furnish proof they have been certified by an registered medical practitioner (or dental surgeon) that they are unfit for work.

It is not disputed that abuse of sick leave (for example, by obtaining a fake MC) is a misconduct that warrants termination. However, the abuse must be factually proven first. For example, by challenging the authenticity of the MC, or by showing that the employee is performing activities inconsistent with the medical assessment which rendered them ‘unfit’ for work.  

Here, the Company failed because it could not establish: (i) that the MC was not genuine; or (ii)  that the Claimant did something mentally or physically taxing that was inconsistent with her being unfit for work. Merely referring to cases which upheld dismissals for abuse of sick leave is insufficient, since those cases would have specific fact patterns and evidence that may not be applicable in the present situation.

In addition, when dealing with dismissals based on serious charges of misconduct, employers must ensure that their inquiries are carried out fairly and in line with the principles of natural justice. While a defective inquiry is not automatically fatal to the Company’s case, depending on the breaches, it can be damaging to the Company and may even point towards mala fide by the Company. Here, the Industrial Court had strong words to condemn the Company’s conduct of the entire affair:

“It is very disconcerting that the Company would use such strong words against the Claimant in the [show cause letter] without even having the advantage of verifying all the facts diligently and adequately….

…  Placing the Claimant under such humiliating circumstances [was] certainly not a fitting description of an employer who ought to look out for the well-being and welfare of its employee. Having demonstrated a lack of concern for its employee … [reflects] poorly on the Company’s manner of treating its employee…

It is not beyond this Court to conclude based on all the evidence before this Court… that the Company was intent on dismissing the Claimant on trivial and trumped up charges of misconduct and will avail itself whatever shortcoming (if any) of the Claimant to dismiss the Claimant from her employment with the Company. This Court has no hesitation to conclude based on all the evidence before this Court that the dismissal of the Claimant was done in bad faith.”

In all dismissals, due process is as important as the substance. The Courts may take a harsh view where the evidence points to the employee being dismissed in bad faith.

***

This article was written by Donovan Cheah (Partner) with assistance from Yeow Jie Hang (Intern). Donovan has been named as a recommended lawyer for labour and employment by the Legal 500 Asia Pacific for 2017-2022, and he has also been recognised by Chambers Asia Pacific and Asialaw Profiles for his employment law and industrial relations work.Donovan & Ho is a law firm in Malaysia, and our employment practice group has built a reputation for providing strategic employment advice to local and global organisations. Our team of employment lawyers provide advice on employment law and industrial relations including review of employment contracts, policies and handbooks, advising on workforce reductions, and managing dismissals of employees for poor performance or misconduct. We also represent clients in unfair dismissal claims and employment-related litigation. Have a question? Please contact us.

 

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