TETUAN HASNAL & PARTNERS v SYAIRATUL MAHFUZAH BINTI FAUZI

Case Significance

Instructive on an employee's entitlement to a maternity allowance under the Employment Act 1955 despite a procedural notice lapse absent proof of employer prejudice, and on the right to resign during maternity leave.

This High Court decision at Shah Alam is an employer's appeal against a decision of the Director-General of Labour (Ketua Pengarah Tenaga Kerja) ordering the employer to pay a former employee a maternity allowance under the Employment Act 1955. The appellant, a law firm, was directed to pay the respondent, its former office and accounts manager, a maternity allowance, and it appealed. The respondent had commenced maternity leave, to which she was entitled for 98 days, and while still within that period gave notice of resignation. The Director-General found that the respondent qualified for the maternity allowance, satisfying the conditions under section 37(2)(a) of the Employment Act 1955, that she had complied with section 40(2) as to notifying her pregnancy, and that there was no substance in the employer's complaints that she had failed to give notice of maternity leave or was guilty of misconduct. On appeal the employer contended that the Director-General had erred because the respondent had not given maternity-leave notice in accordance with standard office procedure, had breached the terms of her appointment letter, and had committed misconduct. The court dismissed the appeal with costs, finding no error in the Director-General's decision. It held that a failure to follow a prescribed notice procedure did not deprive the respondent of her entitlement to the maternity allowance unless the employer could show that it had suffered prejudice, and no evidence of prejudice had been given. It agreed that there is no law preventing an employee from resigning while on maternity leave, and that in any event the timing of the resignation notice made no difference because it fell within the maternity-leave period. On the misconduct allegation, it accepted the Director-General's view that the point was an afterthought which should have been dealt with, through a proper inquiry, while the employee was still in service. The judgment is instructive on an employee's entitlement to a maternity allowance under the Employment Act 1955 notwithstanding a procedural notice lapse, absent proof of prejudice, and on resignation during maternity leave.