In Ng Ying Yiing v Symphony Life Berhad [Award No. 1678 of 2024], an employee (who was also the Group Chief Financial Officer) was hastily terminated on purported grounds of misconduct. This case highlights the pitfalls to avoid, especially when dealing with a dismissal that involves many complex moving parts such as C-suite employees, allegations of financial impropriety and whistleblowing complaints.
Brief Facts
The Company terminated the Claimant for these misconducts:
- the Claimant had wrongfully instructed the unauthorized transfer of funds to purchase shares on behalf of the Company; and
- the Claimant had, without authorisation, provided the Company’s payroll information regarding 163 employees to the former Group Advisor.
The Claimant lodged a representation of unfair dismissal which was referred to the Industrial Court.
The Company separately initiated a civil action against, amongst others, the Claimant and the Group Advisor for the purported unauthorised purchase of shares and the provision of payroll information (“Civil Suit”).
Court’s Findings
The Industrial Court found that the Claimant was authorised to make investment decisions for the Company as the Group Chief Financial Officer as per the Delegated Authority of Limit and the Director’s Circular Resolution. Further, the required approvals were obtained by the Claimant for the impugned transactions. Therefore, there was no misconduct from the Claimant when she had instructed the transfer of funds to purchase shares on behalf of the Company.
There was also no misconduct in providing the payroll information to the former Group Advisor (a shadow director), who was involved in financial matters which would include payroll matters.
Further, before the Industrial Court handed down its award, the High Court dismissed the Company’s Civil Suit against the Claimant, finding that the Claimant had done nothing wrong. The Industrial Court took guidance from the High Court’s finding of fact.
The Industrial Court held that the charges against the Claimant were trumped up after a whistleblower complaint against the Executive Director. The Executive Director got wind of the impending audit investigations against him and set out to scupper the investigations.
The Industrial Court especially noted how hastily the Executive Director dismissed the Claimant. The Claimant was called for an interview with Ernst & Yong (EY) for her alleged misconduct. After her interview ended at 11.30 a.m., EY presented the report to the Company between 12 p.m. to 1 p.m. On the same day, the Claimant was terminated.
However, at that point the Claimant had not even confirmed the lengthy interview notes and the EY consultant would have to had possessed “super-human capabilities” to come up with preliminary findings on such serious charges in a short time.
The termination letter stated that the Claimant was dismissed based on the investigation report from EY. However, the EY report was only prepared on 30 September 2021, after the Claimant’s dismissal on 13 September 2021.
The Industrial Court therefore found that the Claimant was dismissed without just cause and excuse and it was “clear as day” that the entire investigation was orchestrated by the Executive Director solely to frustrate the investigation on his own misconduct.
The Claimant’s was awarded RM792,000 in back wages for the unfair dismissal.
Key Takeaways
Employers must gather clear and verifiable evidence of misconduct before taking disciplinary action or dismissing employees. This includes reviewing documents, such as director’s resolutions and contracts, to confirm whether alleged acts are unauthorized.
Thorough and impartial investigations are crucial. Investigations should be done properly, giving sufficient time to review evidence and avoid rushed conclusions. Procedural fairness in the investigation is necessary to mitigate the risk against an unfair dismissal claim.
Another added level of complexity to this case was that there was a parallel whistleblowing complaint. Retaliatory actions against whistleblowers or employees involved in investigations can have severe consequences. Employers should implement robust whistleblower policies to protect employees and foster a culture of accountability. Retaliatory dismissals, as seen here, expose companies to legal challenges, harm morale, and deter others from reporting genuine concerns.
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This article was written by Sabrina Chang (Associate) from Donovan & Ho’s employment law practice.
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.
