DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR (BAHAGIAN RAYUAN DAN KUASA-KUASA KHAS) PERMOHONAN UNTUK SEMAKAN KEHAKIMAN

NO. R3(2)-25-190-2006 Dalam perkara mengenai permohonan untuk suatu certiorari dan mandamus berkenaan Award No. 727 Tahun 2006 bertarikh 28.04.2006 yang dibuat dalam kes Mahkamah Perusahaan No. 1(12)/1-591/2004 dan 1/6566/2004; Dan Dalam perkara mengenai Seksyen 20 Akta Perhubungan Perusahaan, 1967; Dan Dalam perkara mengenai Aturan 53 Kaedah-Kaedah Mahkamah Tinggi, 1980; Dan Dalam perkara mengenai Jadual 1, Akta Mahkamah Kehakiman, 1964; Dan Dalam Perkara mengenai Seksyen 44(1) Akta Relif Spesifik, 1950

ANTARA

NISSHO IWAI CORPORATION

...

PEMOHON

DAN

1. KESATUAN KEBANGSAAN PEKERJAPEKERJA PERDAGANGAN ...

RESPONDEN PERTAMA RESPONDEN KEDUA

2. MAHKAMAH PERUSAHAAN MALAYSIA ...

GROUNDS OF DECISION

This judicial review application for an order of certiorari to quash the Award of the Industrial Court dated 28.4.2006 (Award No. 727 of 2006), and for consequential reliefs as may be appropriate, raised a very short point on compliance by the Applicant Company of a Collective Agreement, more exactly Article 18 of that Collective Agreement.

The application for judicial review was dismissed with costs to be taxed unless agreed. No jurisdictional error on the part of the learned Industrial Court Chairman was found established. The Applicant founded this case essentially on the decision of the Industrial Court being manifestly unreasonable. Upon perusal of the facts and applying the law, the decision of the Industrial Court, in exercising its discretion under the Industrial Relations Act 1967, could

not be said to be a decision which no reasonable tribunal in the same position as the Industrial Court would have made.

There were only two issues before the Industrial Court, namely:

(1)

Whether the notice period given by the Applicant to the employees before retrenchment was shorter than what was provided in the Collective Agreement.

(2)

Whether any notice was given by the Applicant to the Union (the 1st Respondent) before the Applicant served the Notice of Retrenchment to the employees.

It was agreed that on the facts, these notices were not given within the period as required under the Collective Agreement.

The relevant provision in the Collective Agreement was Article 18 (b) which provided in its relevant parts:
"The Company shall inform the employees affected by redundancy with as much notice as possible and in no event shall such notice be less than the following:(i) (ii) (iii) For those with more than five years of service 8 weeks notice or 8 weeks salary in lieu of notice. However, the Union shall be notified of the above at least one month before service of Notice of Retrenchment to the redundant

employees to provide the opportunity for discussions between the Company and the Union on the Company's intention to retrench."

It was not in dispute that the Applicant Company did not comply with the above provisions on length of notice.

Two employees were involved. As regards the first employee, Tan Hock Huat, the Notice of Retrenchment was dated 27.2.2004. He was informed he would be retrenched on 31.3.2004. As regards the second employee, Halimah binti Fedros Khan, the Notice of Retrenchment was 18.3.2004, with the retrenchment to take effect on 30.4.2004. The first Notice of Retrenchment on Tan Hock Huat was subsequently amended and by another Notice dated 18.3.2004, with retrenchment to take effect on 30.4.2004. Taking the effective date of the Notice of Retrenchment as 18.3.2004, there was still short service by 17 days. Retrenchment should have been on 17.5.2004, as was observed by the Industrial Court.

The panel member representing the employees wanted them compensated with eight weeks salary for the short service, basing the argument on Article 18(b) (iii), as stated above. The Industrial Court, however, by a majority decided to award only 17 days salary. The majority noted:
"The court took into account that this is a case of a short notice to the employees and not the case of no notice been given. The Company needs only compensate them for the shortage in notice period. The court takes the 18th March 2004 as the date of

the notice. Then by giving eight weeks Notice the Retrenchment should be on 17th May 2004. However, there were retrenched on 30th of April 2004. In the case of Tan Hock Huat although he was retrenched on 31st March 2004 (at his request), he was paid April 2004 salary. The court therefore by a majority decision orders the company to compensate the employees with 17 days salary only." (At pages 5 to 6 of the award).

There was nothing punitive or manifestly unreasonable in this conclusion of the majority.

As regards the notice to the Union, it was agreed that no notice was given. The Company nevertheless submitted that negotiation in fact took place between the Company and the Union, and further, during the negotiation the Union did not raise the issue of notice. On the second issue, the Industrial Court unanimously agreed that for this non-compliance the Company should pay the employees a further three months salary. It was made clear in the award that the panel agreed they should follow the decision of the Industrial Court in the Raintree Club case. See the reported decision, Raintree Club Kuala Lumpur v Club Employees Union Peninsular Malaysia [2002] 1 ILR 723.

Counsel for the Applicant appraised the court on the Court of Appeal decision in the matter. The Raintree Club case was reversed by the Court of Appeal, but no grounds of decision were given. Counsel therefore argued it would be wrong for the Industrial Court to still award the three months salary in lieu of notice as a form of compensation since this would be punitive in nature. There was

simply no provision in the Industrial Relations Act to allow for this sort of punitive compensation. Counsel also relied on the decision of the Supreme Court in Dunlop Industries Employees Union v Dunlop Malaysia Industries Berhad & Another [1987] 2 MLJ 81, for the proposition that any form of compensation for a breach of this notice requirement vis a vis a Union, must be awarded to the Union and not to the employees. This was a case of reinstatement, not the award of compensation for retrenchment. In any event, the Supreme Court set aside the order of the High Court which quashed the Award of the Industrial Court in this matter. The thrust of the Supreme Court position in Dunlop Industries recognised the wide powers and discretion available to the Industrial Court in this connection. It was observed that the purpose of the notice requirement of the union was to provide an advance notice "to give time and make way for mutual consultation and negotiation in line with the provisions of the Code of Conduct for Industrial Harmony so as to obviate and abort any imminent trade dispute" (Per Abdoolcader SCJ at page 83 of the Report).

The Supreme Court further observed:

"It accordingly follows that in dealing with the complaint of non-compliance under section 56 the Industrial Court has all the powers with which it is invested in relation to trade disputes The provisions of section 30(5) and (6) will also therefore equally applied in considering a complaint under section 56"

Thus, with the statutory invocation to act "according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal form under section 30 (5), the Industrial Court in this instant judicial review application had acted properly in law. The High Court should be slow in upsetting the Industrial Court's decision unless there was a clear jurisdictional error or manifest unreasonableness. It could not be regarded as obviously perverse for the Industrial Court to have awarded the three months salary. To have awarded less, or no compensation at all, would have meant allowing the employer to act with impunity and disregard a very important term in the Collective Agreement which has as its purpose the maintenance of Industrial harmony and encouragement of negotiation to prevent industrial disputes.

For the above reasons, the application for judicial review was dismissed with costs to be taxed unless agreed.

Dated

14th December 2009

Sgd ( MOHAMAD ARIFF BIN MD. YUSOF ) JUDGE HIGH COURT MALAYA KUALA LUMPUR

COUNSELS

For the applicant: Anthony Gomez Messrs Gomez & Associates.

For the 1st respondent: Ramdas Tikamdas Messrs Siva, Ram & Associates.