high achievers and high deceivers: how your … · 2018. 4. 24. · perempuan banyak? … you know...

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SKRINE

HIGHACHIEVERSANDHIGHDECEIVERS:HOWYOURSTRONGESTASSETCANBEYOURBIGGESTLIABILITYNationalEmploymentLawConference201818April2018

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Highlyvaluedemployeesbecomingperpetratorsofmisconductsuchasworkplaceharassment/discrimination,breachingofofficerulesandprocedureswithmanagementclosinganeyetoit

Malaysian Law Firm of the Year 2008, 2009, 2010, 2011, 2013, 2014, 2015 & 2016 Who’s Who Legal Awards

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3 Malaysian Law Firm of the Year 2008, 2009, 2010, 2011, 2013, 2014, 2015 & 2016 Who’s Who Legal Awards

Highachievers/highvalueemployees

Butwhathappensifthatpersonbehavesbadly?

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Misconductmeanssuchactorconductasadverselyaffectsemployeesdutiestowardstheemployer.Themisconductcomplainedofmusthavethesamerelationswiththeemployeesdutiesortheworkentrustedtohimbytheemployerorhiscompetencytoperformancethesame.Anybreachofanexpressorimplieddutyonthepartoftheemployee,unlessitbeofatriflingnature,wouldamounttomisconduct.

(IndustrialCourtinPlaatRubberSdnBhdv.GohChokGuan[1995]1ILR79)


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Behaviour amounting to misconduct

a) Harassmentandbadtreatmentofstaffsuchasbullying,threatening,intimidating,sexualharassment;

b) Insubordinate;c) Conflictofinterest;d) Committingfraud/excessiveclaims;e) Conductingpersonalbusinessduringoffice

hours;andf) BreachofEmployer’srules/policiessuchas

absenteeism,lateness,leavingworkearly.

6 6 Malaysian Law Firm of the Year 2008, 2009, 2010, 2011, 2013, 2014, 2015 & 2016 Who’s Who Legal Awards

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Sexualharassment


TheHeadofResearchandTechnologyDivisionintheCompanywasdismissedwithjustcauseandexcuseforsexuallyharassinghissubordinateby:-

• Touchingandsqueezingherhandseveraltimesdespiteherpullingaway

• Verbalharassmentbysaying:“Idon'tplantomarryanotheronebutyoucanneverknow...nafsulelakisatu,nafsuperempuanbanyak?…youknowlanafsulelakiituapa?”

• Goingclosetoherdespitehersaying“Ihavenothingtosaytoyou”andcontinuouslymovingcloseruntilshesaid“donotmakememakeascenehere”

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Cont.


• SendingpersonalSMS/usinglanguagethatisuncalledfor-"...samamacammywife...Itengokyoutaksembahyang.""Sorry,maybeIdidn'tseethatyousembahyang""Tellme…whatyouhavetosayaboutme,Iknowyouhavealottosay.""Lookatme…,lookatme""Don'ttellthistoanyone".

CourtheldthatitwasreasonablefortheCompanytodismisstheClaimantandthedismissalwaswithjustcauseandexcuse

YahyaMatWazirvPetroliamNasionalBerhad(Petronas)[2015]2ILR201

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ConflictofInterest


TheClaimantwasaprojectengineerintheCompany.TheCompanyreceivedanemailfromoneofitssupplierswhichcontainedanemailfromtheClaimantwhopresentedhimselfastheManagingDirector/ChairmanofOilfieldsDrillingTechnologies(M)SdnBhd.ItwasdiscoveredthattheClaimanthadsetupOilfieldsDrillingwithhissonandthathewasoneofthedirectorsandshareholders.OilfieldsDrilling’snatureofbusinesswaslistedasoilandgasengineering,servicesandsupplies,whichissimilartotheCompany’snatureofbusiness.TheCourtconsideredtheClaimant’sterminationtobereasonableandjustified.

JacobAlongvMiDrillingFluids(Malaysia)SdnBhd[2015]2LNS0315

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Conductingpersonalbusinessduringofficehours


AgeneralmanageroftheCompanywasdiscoveredtohavebeenactivelypursuinghisownbusinessopportunities.• HevisitedBangkokattheCompany’scostandexpenseon

thepretextofvisiting“countryofficeandmeetingpotentialclient”whenheinsteadtohelppromoteanothercompany,Cekap.

• HealsoabusedhisauthorityoverasubordinateandmadethelatterpromoteCekap’sbusiness.

• Hewasalsofoundtohavelefthiscompanycarandpetrolcardwithhisfamilytobeusedbythem.

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Cont.


TheCourtfoundthattheclaimant,byhisactions,hadnotonlyputhimselfinapositionofconflictofinterestbuthadalsomisusedandabusedhispositiontocarryoutotherbusinessoutsidehisofficialdutiestothecompanyforhisownpersonalinterest,andabusedhisauthorityinmakinghissubordinatepromoteCekap’sbusiness.Hisdismissalwasfoundtobeappropriate.

MohamadMudavM3nergyBerhad[2015]2ILR64

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Making false claims


TheClaimantwastheSeniorVicePresidentoftheCompany.Shewasfoundtohavemadefalseclaimsonnumerousoccasions,including:-• ClaimsforSecretRecipecakeswhichshesaidwasgiventocustomers,whenitwasactuallyforherdepartment’sstaff’sbirthdays;

• Shehadluncheswaswithcolleagues,butclaimedreimbursementinrespectofentertainmentwithcustomers;

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Cont.


• Usedfalseparticularsonseveralcountswhenmakingclaims–theclaimparticularsdidnotmatchthereceipts

CourtheldthattheClaimantheldaveryseniorposition.Inlightofthenumerousoccasionsinwhichtheclaimanthadsubmittingfalseclaims,thebankcouldnolongerreposethenecessarytrustandconfidenceinher.

LeeYuMengvAllianceBankMalaysiaBerhad[2016]1ILR216


Butthesebusinessconsiderationsmaycometomind…

• Whohasgreatervalue:highachievervscomplainant

• Whatifaconfrontationupsetsthehighachieverandhe/shedecidestoleave?Theemployermaydecidetonotsayanything,allowinghis/hermisbehaviourormisconducttoperpetuateandworsen.

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WHATARETHEOPTIONS?

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Option1:

Don’ttakeactionagainstthehigh

achiever

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LegalRamifications

1)Noactiontaken


Ifnoactionistakenagainstthehighachiever,theCompanymaybefacedwiththeconstructivedismissalofthecomplainant.

ConstructiveDismissaloftheComplainant

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Whatisconstructivedismissal?

Constructivedismissalariseswhenanemployeeterminateshiscontractofemploymentattheappropriatetimeandthereforeconsidershimselfdischargedfromfurtherobligationsbecausetheemployerisguiltyofsuchbreachasaffectsthefoundationofthecontractorbecausetheemployerhasevincedorshownanintentiontonolongerbeboundbyit.

WongCheeHongvCathayOrganisation(M)SdnBhd[1988]1MLJ92



• Sexual/OtherHarassment• Abusivetreatment• Intolerablebehaviour/badlanguage• Failuretogivenecessarysupport/treating

employeeinacavalieranddismissivemanner• Persistentattemptstovaryconditionsof

employment• Constantlyunderminingtheemployee• Demotingtheemployee


SituationswhichgiverisetoConstructiveDismissalinclude:-

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TheClaimantclaimedthathewasconstructivelydismissedastheManagingDirectorwould:-

• scoldhiminthepresenceofothersformistakes;• useprofanitiestowardshim;• verballyabusedhimwithvulgarwordsformistakesdonebyasecurity

guard;• callforameetingandridiculeandinsulthiminthepresenceofhis

colleagues;• ShownhisfisttowardstheClaimantwhilstsayingthathewouldnotbe

abletosustainapunchfromhimandhewasaformerathleteandhadalotofstrength;

• ToldanotheremployeetoassaulttheClaimantwhilewarningtheClaimantthatthesaidotheremployeewasaformerAmericansoldierandholda“Dan2”inTaeKwonDo;

ConstructiveDismissaloftheComplainantExampleCases


• ThrewabundleofdocumentsonthetableangrilytointimidatetheClaimant

• AnothercolleaguesawtheMDholdingtheClaimantbyhisneck;

TheCourtfoundthattheMDwasatemperamentalpersonwithaviolentcharacterwholikestoshoutandraisehisvoiceatemployeeswhocouldnotanswerhimproperlyorwhoseperformancewasnotuptohisexpectation.Hewoulduseprofanitiesandattimesresorttoviolencebyassaultingthem.

TheCourtfoundthattheClaimantsucceededinprovingthathewasconstructivelydismissedandthatthedismissalwaswithoutjustcauseorexcuse.

MampuJayaSdnBhdvAloysiesFathianathan[2008]2LNS2011


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TheClaimantwasbeingsexuallyharassedbyherimmediatesuperior.

• Hersuperiorrequestingthatshespendthenightwithhiminhishotelroom

• askingheroutfordinnerafterofficehours• commentingonherdress• askinghertoattendanoutstationofficetripwithhimbutgetting

angrywhenshemadeherowntravelarrangementstogobyherself(agreeingtobeartheexpensesherself)andbookingtheovernightaccommodationonherown

• WhentheClaimantraisedtheissuewiththeCompany’sseniormanagement,noactionwastakentoprotecther

TheCourtfoundthattherewasabreachofheremploymentcontract.

SittTattBerhadvFloraGnanapragasam[2006]1MLJ497


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HARASSMENTLiabilityoftheEmployer

TherecentcaseofMohdRidzwanbinAbdulRazakvAsmahbintiHjMohdNor[2016]4MLJ282,theFederalCourtrecognisedthetortofharassment,withsexualharassmentbeingapartofit,asavalidcauseofactioninMalaysia.

Followingtherecognitionofthetortofsexualharassment,employersmayfindthemselvesvicariouslyliablefortheharassmentbytheiremployee.

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HARASSMENTLiabilityoftheEmployer

Whatisvicariousliability?

Essentially,itistheprincipleoftheemployerbeingresponsiblefortheactofitsemployee,inthecourseofhisemployment(MaslindabtIshakvMohdTahirbinOsman&Ors[2009]6MLJ826).

“Inthecourseofemployment”meansinthecourseofhisspecificworkforwhichheisemployedandwhatisincidentaltoit.

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SEXUALHARASSMENTLiabilityoftheEmployer

PartXVAoftheEmploymentAct1955wasintroducedon1April2012todealspecificallywithsexualharassmentintheworkplace.

UnderthisPart,employersarerequiredtoinquireintoanycomplaintrelatingtosexualharassment.Iftheemployerissatisfiedthatthesexualharassmenthasbeenproved,disciplinaryactionmustbetakenagainsttheaccusedemployeewhichmayincludedismissal.

Failuretoinquireintothecomplaintofsexualharassmentisanoffenceand,onconviction,theemployershallbeliabletoafinenotexceedingRM10,000.

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Ifahighachieversuperiorunjustlydismissesasubordinate,itistheemployerwhofacestheliability.

UnjustDismissalbythehighachieversuperior


• EmployersshouldalsobeawareoftheMACCAmendmentBill2018(passedinDewanNegaraon6.4.2018).

• Thisamendmentintroducescorporateliabilityoncommercialorganisationsifapersonassociatedwiththeorganisationcorruptlygives,agreestogive,promisesorofferstoanypersonanygratificationwhetherofthebenefitofthatpersonoranotherpersonwiththeintenttoobtainorretainbusinessoranadvantageforthecommercialorganisationsortoobtainorretainanadvantageintheconductofbusinessforthecommercialorganisation.

Consequencesduetocorruptionofthehighachiever

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• Uponconviction,theorganisation,itsdirectors,officersandmanagementmaybeliableto:-

! Amaximumfineof10timesthesumofgratificationinvolvedorRM1million,whoeverismore;

! Amaximumjailtermof20yearsor! Bothpenaltiesoffineandjailterm

Consequencesduetocorruptionofthehighachiever

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Ifnoactionistaken…

Ultimately,themisconduct/tortiousbehaviorofthehigh

achieverwillresultinliabilityfortheemployer.

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a) Paymentofcompensationtothewrongedemployee(whetherthecomplainant/subordinateoreventhehighachiever)

b) Costsindefendinglegalactionbyemployees

c) Financiallossesduetofraudd) Costsincommencinglegalactionagainst

employeewhocommittedthemisconduct

Relatedfinancialconsequences


Non-LegalRamifications

1)Noactiontaken

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WhatcouldhappeniftheEmployertakesnoactionagainstthehighachiever/highvalueemployee?


a) Staffmaybeill-treatedduetoabuseofpowerb) Fraudmaygrowuncheckedc) Companyrulesnotfollowedbyothers


d)Decreasedproductivityofemployees

! Lossofemployeemorale,cultureofapathyandnegativity,leadingtoalossofproductivity

! Stressrelatedabsenteeism! EmployeesdecidingtoleavetheCompany


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e)ReputationoftheCompanyatstake

! Unabletoattractandrecruitgoodnewstaff! Unabletoretaingoodstaff! Lessattractivetocustomers(noonewantstohireacompanyseentoallowfraud/sexualharassment/badtreatmentofstaffandcustomers)

! Mayattractmediapublicity,especiallyintheageofsocialmediaandconnectivity.



Theemployeemaytakenon-actionasacceptance/condonationandthebehaviormayescalate.

Inthelongrun,itwillbedestructiveto

theCompany


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Option2:

Takeactionagainstthehigh

achiever


LegalRamifications

2)Takeaction

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• Oncemisconductisdiscoveredfollowinganinvestigationandthehighachieverhasnotgivensatisfactoryreasonsforhis/hermisconduct,theemployerisfacedwiththedecisionofwhichpunishmenttoimpose.

• Iftheemployeeisdismissed,theemployermayfaceaclaimforunjustdismissalandhavetodefendthesameintheIndustrialCourt.

• Ifthepunishmentislessthandismissal,theemployeemaynotbesatisfiedandclaimconstructivedismissal,whichagainresultsintheemployerdefendingitsdecisionintheIndustrialCourt.

Potentialclaimsofconstructive/unlawfuldismissal



2)Takeaction

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a) Thehighachievermayleave;b) Thehighachievermaytakeateamofloyal

subordinates;

c) He/shemaybedemoralisedtoworkandnotbe

interestedinwork;

d) He/shemaytakeouthis/herangeronthecomplainant.

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Dealing with legal risks as not to mar the organization’s reputation and potential liability

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WHY?

Dealingwiththelegalrisks


• Theemployerrunstheriskofreducedproductivityifnotmanagedproperly

• Successfulbusinessisaboutateamandbuildingonsuchteam

• Employeesfeelmoreconnectedtothevaluesoftheemployersiftheywitnessacultureofintegritythroughtheirsuperiors.

• Otherwise,riskofnocontinuityandnogrowthinthelongrunjustbecausehighachiever’sbehaviourallowed.

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HOW?

Mitigatingthelegalrisks


HaveacompanywideassessmentoftheethicalcultureEnsurethatthereisanethicalculture,where:-

• Employeesbelievethattheemployerdoesnottolerateunethicalbehaviour

• Employeesbelievethatmanagementrespondsquicklyandconsistentlytounethicalbehaviourwhenitoccurs.

• Actionsspeaklouderthanwords• VisiblyenforcetheCompany’sethicalcommitments

Haveacompanypolicyregardingworkplacebehaviourinlinewiththecultureandhavetrainingsandsessionstoensurethatemployeesknowwhatbehaviourisacceptableandwhatisnot.

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Keepthebehaviourincheck–quickly

! Haveregularreviewswithemployeesandkeeptheirperformance/behaviourincheckthroughclearKPIs.

! Ifthepoorperformanceisserious,conductPerformanceImprovementPlans.

! Incasesofmisconduct,takeactionimmediately.Ifnot,abadexamplewillbeset.Givewarningsandopportunitiesfortheemployeetoimprove.Ifnoimprovement,startdisciplinaryaction.


Howtodealwiththemisbehavingemployee?

! Becalmandhaveaninformalchatwiththeemployee! Beginwithaskingiftheemployeeisawareofanyongoing

issues! Ifunaware,describetheunacceptablebehaviourina

honestbutneutralmanner.Ensurethatexamplesofsuchbehaviouraregiven.

! Allowtheemployeetorespond,andlistentothem.! Haveaseniormentorandfollowupwiththeemployeeand

giveconstructivefeedback! Ifthebehaviourisnotimproving,theemployermayneed

toconsiderwhethertotakedisciplinaryaction.

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Haveaproperandeffectivegrievancemechanism

! Haveamechanismwhereemployeescanairtheirgrievancesandcomplaints

! Anindependentcomplaints/grievancecommitteecanbeformed

! Incaseswherethemisconductinvolvesasuperior,haveachannelforcomplaintstobemadedirectlytoacomplaintscommittee

! Ensurethatemployeesfeelsafereportingmisconductsandneednotbeconcernofretaliation


HaveamechanismtocombatSexualHarassment! Haveapolicystatementprohibitingsexualharassmentinthe

company;! Cleardefinitionofsexualharassment;! Complaints/grievanceprocedure;! Disciplinaryrulesandpenaltiesagainstharasserandfalseaccusers;! Protectiveandremedialmeasuresforvictim;! Promotionalandeducationalprogrammestoexplaincompany’s

policyandtoraiseawarenessofsexualharassmentanditsadverseconsequences.

(asrecommendedbytheMinistryofHumanResourceintheCodeofPracticeonthePreventionandEradicationofSexualHarassmentintheWorkplace)

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Preventfraudandcorruptionintheworkplace! Beawareofwherefraudandcorruptionislikely! Understandandmanagetheareasofriskunderyourcontrol! Haveagoodunderstandingofwhypeopleengageincorrupt/fraudulent

activityinyourindustry! Leadbyexample,fromtopdown! Ensureinternalcontrolsareadequateandeffectiveinpreventingand

detectingandappropriatelyrespondingtopotentialincidences! Encourageemployeestospeakupifsomethingdoesn’tlookright


Preventfraudandcorruptionintheworkplace! Someinternalcontrolexamples:-

" Establishclearjobdescriptions" Avoidhavingonepersonbeingresponsibleandundertakinganentire

transactionbyhimself/herself" Staffawareness,educationandtrainingtoensurethatstaffcan

recognizesignsofpossiblecorruption/fraud" Haveaculturewherestaffarecomfortableandabletoraiseconcerns" Ensureprotectivemeasuresareimplementedtosafeguardassetsand

data" Havearecordsmanagementpolicy

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SivaKumarKanagasabaiPartner

SkrineUnitNo.50-8-1,8thFloor,WismaUOADamansara

50JalanDungun,DamansaraHeights50490KualaLumpur

#:+603-20813999ext828email:[email protected]:www.skrine.com


high achievers and high deceivers: how your … · 2018. 4. 24. · perempuan banyak? … you know...

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