Stay of Industrial Court Monetary Awards

by | Nov 4, 2020 | Law

In cases of unfair dismissal or constructive dismissal, if the Industrial Court finds in favour of a Claimant, the Industrial Court would generally award backwages and compensation in lieu of reinstatement.

In Koperasi Serbaguna Sanya Bhd. (Sabah) v. Dr. James Alfred and Anor [2000] 3 CLJ 758, the Court of Appeal noted:

“In industrial law, the usual remedy for unjustified dismissal is an order of reinstatement. It is only in rare cases that reinstatement is refused. For example, as here, where the relationship between the parties had broken down so badly that it would not be conducive to industrial harmony to return the workman to his place of work. In such a case, the Industrial Court may award monetary compensation. Such an award is usually in two parts. First, there is the usual award for the arrears of wages, or back wages, as it is sometimes called. It is to compensate the workman for the period that he has been unemployed because of the unjustified act of dismissal. Second, there is an award of compensation in lieu of reinstatement.”[1] (emphasis mine)

The Industrial Court could possibly award monetary compensation in trade disputes. For example, the Industrial Court in Kesatuan Pekerja-Pekerja Dalam Perkhidmatan Perubatan Dan Kesihatan Swasta v Assunta Hospital [Industrial Court Case No. 21(26)(13)/3-455/15][2] ordered the Company to make a one off payment of RM1,000.00 to selected confirmed employees.

The Industrial Court’s decision was affirmed by the High Court in Assunta Hospital v Kesatuan Pekerja-Pekerja Dalam Perkhidmatan Perubatan Dan Kesihatan Swasta & Anor [Kuala Lumpur High Court Judicial Review Application No. WA-25-215-05/2019].

For the purposes of this article, any Industrial Court Award ordering the payment of monetary compensation will henceforth be referred to as an “Industrial Court Monetary Award.”

Stay

When an Industrial Court Monetary Award is challenged at the High Court via judicial review, it is not uncommon for the Applicant/Company to apply for a stay of the Industrial Court Monetary Award.

For example, in Ngeow Voon Yean v Sungei Wang Plaza Sdn Bhd/Landmarks Holding Bhd [2006] 5 MLJ 113, the Federal Court noted in passing that the High Court had granted a stay of the Industrial Court Monetary Award:

“The appellant questioned his dismissal in the Industrial Court and in Award No 179 of 1993, dated 16 June 1993, that court ruled in his favour and held his dismissal to be without just cause or excuse. The appellant was awarded compensation in lieu of reinstatement, back wages and payments in respect of leave due and not taken, to be paid to him within one month of the date of the award. A stay on the award was granted pending further proceedings in the High Court.”[3] (emphasis mine)

In Sungei Wang Plaza Sdn Bhd & Anor v Ngeow Voon Yean & Anor [1997] MLJU 261, Abdul Kadir Sulaiman J (as His Lordship then was) noted in his judgement:

“On 16th June 1993 the Industrial Court handed down the impugned award holding that the dismissal of the first Respondent was without just cause or excuse and awarded him with compensation in lieu of reinstatement, back wages and payments in respect of leave due and not taken, to be paid to him within one month of the date of the award. Aggrieved with the terms of the award, the Applicant filed this application and obtained a stay of the order of the Industrial Court until the determination of the application.”[4] (emphasis mine)

The purpose of the stay is to disallow the Claimant/Union, amongst others, from pursuing non-compliance proceedings against the Applicant/Company pursuant to Section 56 of the Industrial Relations Act 1967.

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