MALAYSIAN INDUSTRIAL RELATIONS &

EMPLOYMENT LAW

Chapter Nine

Misconduct and
Disciplinary Procedure

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Employment Law
 Preview
 Discipline at the workplace
 Challenging disciplinary action
 Disciplinary action for misconduct
 Procedure prior to a dismissal for misconduct
 Holding a domestic inquiry
 Dismissal for unsatisfactory performance
 Frustration of contract
 Ending of a fixed-term contract

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 Discipline at the workplace
 Industrial harmony and productivity require
discipline and compliance with rules at the
workplace.

 Employees can challenge disciplinary action

taken by employer if they consider it unfair.

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 Employees’ right to challenge
disciplinary action
In order to challenge disciplinary action
taken against them, employees can:
 File a complaint at the Labour Department,
if they are within scope of EA
 Lodge a complaint at the Department of IR
 File a claim at the High Court

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 Employees’ right to challenge
disciplinary action, cont.
 Labour Department can order any penalty
set aside if the penalty means loss of wages
to the employee.
 Labour Department can order employer to
pay termination benefits, wages in lieu of
notice, and wages in lieu of annual leave if a
dismissal unfair.

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 Employees’ right to challenge
disciplinary action, cont.
 Industrial Relations Department conducts
conciliation, assists the parties to find a
solution to the dispute.
 If conciliation unsuccessful, Minister may
refer dispute to the Industrial Court.
 The Court will decide whether the dismissal
was with or without just cause or excuse.

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 Employees’ right to challenge
disciplinary action, cont.
The Industrial Court may:

 Uphold the dismissal of the employee

 Order reinstatement

 Order the employer to pay compensation to

the employee

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 Employees’ right to challenge
disciplinary action, cont.
The High Court can order an employer

to pay wages in lieu of notice if it finds

an employee has been unlawfully

dismissed.

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 Misconduct
 Improper behavior, act or conduct which is a
breach or violation of work or standard of
behavior

 Three types of misconduct:

 Misconduct relating to duty

 Misconduct relating to discipline

 Misconduct relating to moral

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 Misconduct (Cont.)
Misconduct relating to duty
 Employee conduct that is inconsistent with the due and faithful
discharge of duties
 E.g. Dishonesty, carelessness, insubordination, theft and breach of
confidential company information

Misconduct relating to discipline

 This refers to breach of the employer’s disciplinary rules
 E.g. Fighting, assault, gambling, damaging company property, drug
abuse, coming late to work, leaving early and sleeping on duty

Misconduct relating to morality

 This refers to immoral conduct
 E.g. Indecent acts, engaging in improper relationship with other
employees, sexual harassment, and keeping, showing or distributing
indecent or pornographic materials at the workplace
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 Misconduct (Cont.)
 Not all misconduct should result in dismissal
except:
 Dishonesty / Cheating

 Insubordination

 Bribery

 Theft / Fraud

 Intoxication at work

 Illegal strike

 Others (Breach of duty, sexual harassment)

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 Disciplinary action
 Formal censure or counselling

 Suspension of the employee’s participation in

the performance pay scheme

 Demotion

 Suspension of work with or without pay

 Transfer or reallocation of duties

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 Disciplinary action for misconduct
 Employers have the right to punish an
employee for misconduct.
 Penalties include:
 Warnings
 Demotion
 Suspension without pay
 Dismissal

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 Disciplinary action for misconduct
Penalties include:
 Formal censure or counselling
 Suspension of the employee’s participation in
the performance pay scheme
 Demotion
 Suspension of work with or without pay
 Transfer or reallocation of duties

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Disciplinary action for misconduct,
cont.
 Misconduct can occur on the job or off the
job.

 Misconduct can be minor or major.

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 Disciplinary action for misconduct,
cont.
An employee may be dismissed for

misconduct, BUT the misconduct must

be major and a fair procedure must be

followed prior to the dismissal.

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 Disciplinary action for misconduct,
cont.
Procedure prior to Dismissal
1. Investigate and collect evidence of any alleged
misconduct. Determine what rules, implied or
express, have been broken. When and where did
misconduct occur? Who was involved? What
exactly happened?
2. If prima facie case exists, prepare for domestic
inquiry (DI).

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 Disciplinary action for misconduct,
cont.
3. Decide whether to suspend employee
prior to DI.
• Prepare for DI.
 Draft charges and give to employee together with
notice that inquiry is to be held.
 Appoint prosecuting officer.
 Appoint secretary.
 Appoint panel of inquiry, including chairman.

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 Disciplinary action for misconduct,
cont.
Hold Domestic Inquiry
A DI follows the format of a criminal court trial but is
simplified.
 Panel of Inquiry chairman is responsible for
smooth conducting of the DI. Chairman must
ensure employee is treated fairly and justly.
 Employer must prove the guilt of the employee
to the satisfaction of the Panel of Inquiry.

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 Disciplinary action for misconduct,
cont.
 Employer opens the DI by introducing witnesses
and evidence. Examination and cross-
examination of witnesses takes place.
 Employee offers evidence in his defence, if any.
Examination and cross-examination of witnesses
takes place.
 After final closing submissions, Panel of Inquiry
make a decision, put it in writing with
justifications and submit to the employer.

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 Other situations leading to
termination of employment
Dismissal for unsatisfactory performance

 No DI necessary

 Employee must be warned, and given time

to improve. Employer should provide
assistance so that employee can improve.

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 Other situations leading to
termination of employment, cont.
Frustration of Contract
Employee’s contract may come to an end because
it is frustrated by some event beyond control of
employer or employee including:
 Serious illness or incapacity
 Detention by the authorities for lengthy period
 Withdrawal of required license

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 Other situations leading to
termination of employment, cont.
Ending of a Fixed-Term Contract
 Fixed-term contracts end upon their expiry
date
 Fixed-term contracts may be brought to an
end earlier than expiry date if employer has
just cause or excuse to do so

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 Disciplinary
Procedure

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 Review
 Discipline at the workplace
 Challenging disciplinary action
 Disciplinary action for misconduct
 Procedure prior to a dismissal for misconduct
 Holding a domestic inquiry
 Dismissal for unsatisfactory performance
 Frustration of contract
 Ending of a fixed-term contract

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