High Court quashes Industrial Court award


PETALING JAYA: The High Court has quashed an award of over RM1.2mil in backwages and compensation granted to a former managing director of Sime Darby Auto Selection Sdn Bhd.

High Court judge Justice Nordin Hassan ruled that the Industrial Court had committed serious errors of law in arriving at its decision in October last year.

Following this ruling, the award of compensation is therefore no longer valid for the claimant, Lim Boon Leong.

In the award handed down last year, Industrial Court chairman D. Paramalingam ruled that the company had failed to give any explanation with regard to its policy of placing employees in senior management under fixed-term employment.

The Industrial Court ruled that the fixed-term contract policy was clearly open to abuse.

However, in arriving at its decision that the Industrial Court had committed serious errors of law, Justice Nordin had made among others the following findings:

– The terms of the fixed term contract and letter of promotion were clear and unambiguous;

– The fixed term contract expressly provides that it shall automatically expires without stating any pre conditions; and

– The claimant signed and agreed to the terms and conditions despite having the choice to accept or decline it. Therefore, the claimant must be bound by the terms and conditions therein.

The High Court ruled that the claimant’s release from the company was therefore the result of the expiry of the fixed term contract.

The Industrial Court had in the award last year held that it was evident that Lim was being made a scapegoat for the company’s deteriorating performance as there was no cogent evidence of his poor performance being put forward by the company.

The court chairman found that it would be most appropriate to order Lim be paid backwages of RM29,910 for 24 months but minus 20% because he managed to find another job during the time his service was terminated till the court case was resolved.

Additionally, the court also awarded him 21 months worth of compensation for the 21 years that he had served the company.

Lim, 58, started his career with the group of companies in Hong Kong in 1995.

Lim is appealing against the court’s decision.

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