Case:

Brief Facts:

• This is a Court of Appeal decision against the High Court’s findings which had previously affirmed Industrial Court’s award.
• The Appellant, Novartis Corporation (Malaysia) Sdn Bhd (“Novartis”) dismissed two of their employees, the Head of Marketing/Sales Operations, Key Accounts Management and Market Access (“HOM”) and the Chief Finance Officer (“CFO”). The Respondents filed an unfair dismissal claim in the Industrial Court.
• This case relates only to the CFO
• The Norvatis argued that the dismissal was done on grounds that fraudulent withdrawals amounting to RM4.35 million between 18 October and 22 November 2013 had taken place using the company’s ‘Safeword’ token and password, which were under the supervision of the CFO.
• Norvatis also argued that the CFO was a senior officer and was entrusted as an authorised signatory to safeguard the Safeword password and token, and was therefore responsible for all procedures related to finance.
• The CFO on the other hand argued that the fraudulent withdrawals were conducted by Angie Ng, the Accounts Executive without the CFO’s knowledge. Angie stole the token, which was kept in the CFO’s drawer and his password.

INDUSTRIAL COURT

• The Industrial Court found that the CFO had not knowingly divulged the password to Angie and the CFO had done all that was necessary to ensure the Safeword token was secure and the username and password was kept confidential.
• Therefore the dismissal was without just cause or excuse and reinstatement was ordered.

HIGH COURT

• The High Court concluded that the findings of the Industrial Court are consistent with the facts and evidence and the application for judicial review to quash the Industrial Court award was therefore dismissed.

COURT OF APPEAL

– Appeal against Order for Reinstatement Was ALLOWED

– Appeal against Order that the Dismissal was unlawful was REJECTED

• The Court of Appeal held that a reviewing judge ought not to disturb the findings of the Industrial Court unless they are grounded on illegality or irrationality, even where the reviewing judge might not have come to the same conclusion.
• Therefore, the order of the High Court that the dismissal of the CFO is without just cause and excuse is affirmed.
• However, the Court of Appeal held that the High Court had erred in granting reinstatement. The Appellate court held that there are circumstances where remedy of reinstatement is not appropriate.
• The considerations for the award of reinstatements were the damaged trust and confidence between employer and the employees, their high-ranking positions, and the length of time that had elapsed from their dismissal to the resolution of their claims.
• The Appellate court held that it was apparent that the relationship between the parties had soured following the disciplinary process which had led to their dismissal and the prolonged litigation between them. Therefore it would be inappropriate to grant the remedy of reinstatement.
• The Court of Appeal therefore allowed the appeal in part where the order for reinstatement is substituted with an order for compensation in lieu of reinstatement.