Employer's Right

The Right to Terminate an Employee’s Services

In Award No. 34 made in the case of Majlis Amanah Rakyat (MARA) Kedah and Transport Workers’ Union, Federation of Malaya (Industrial Arbitration Tribunal Case No. 2 of 1967), the learned Chairman stated as follows:-

“It has been stated in the field of industrial relations that just as an employer’s right to exercise his option to terminate an employee’s services in terms of his contract has to be recognised, so is the employee’s right to expect security of tenure to be taken into account.

It follows, therefore, that an employer is at liberty at any time to terminate the services of his employee by contractual notice, but if such termination is in reality for misconduct, natural justice requires that the employees should not be condemned unheard and that the misconduct must be sufficiently, serious to warrant the grave penalty of dismissal.

It has been held that, where the discharge of a workman though ostensibly in pursuance of terms of his contract of service was in reality for an alleged act of misconduct, and not enquiry had been held, nor opportunity was given to the workman to offer his explanation to defend himself, the action of the management in discharging the workman could not be upheld”.

The Court agree with the views expressed in the above dispute and hold that the action of the Company in terminating the services of the Claimant cannot be upheld in the above circumstances.