MMC ENGINEERING GROUP BERHAD v MD GHAZALI BIN ALI

Case Significance

Instructive on the disproportionality of dismissal for a good-faith administrative act amounting only to an error of judgment, and on judicial review of an Industrial Court award tainted by an error of law on the question of misconduct.

This Court of Appeal decision concerns an unfair-dismissal dispute and the disproportionality of dismissal for a good-faith administrative act. The appellant, MMC Engineering Group Berhad, appealed against the High Court's decision, on judicial review, to overturn an Industrial Court award that had dismissed the respondent's claim of unfair dismissal. The respondent had been employed as a general manager for projects under a fixed-term contract and was seconded to a related company as head of a sewerage conveyance system on a major sewerage project. In that role he personally drafted and issued to fixed-term operations staff a document titled a staff commitment to project completion, which acknowledged that the project was suffering severe delay and called on staff to commit to its completion, and it was on the basis of that document that he was dismissed for misconduct. The Court of Appeal, comprising Azmi bin Ariffin, Mohd Firuz bin Jaffril and Ong Chee Kwan JJCA, dismissed the employer's appeal. It held that, taken as a whole, the content of the commitment document was in line with the chief operating officer's expectations and the respondent's own duties, and that its distribution to staff had taken place while the respondent was on leave, so that the employer's allegation that his act had struck at the core of the employer-employee relationship and undermined the employer's reputation was unsupported by the evidence and untenable. The court was unanimous that the employer's case, even at its highest, amounted only to an error of judgment and not misconduct, and that the punishment of dismissal for such a good-faith administrative lapse was wholly disproportionate, particularly as the alleged destruction of trust and confidence had not been proven. It concluded that the Industrial Court award was tainted with an error of law and that the High Court had been correct to allow the judicial review and quash the award, dismissing the appeal with costs of RM20,000. The judgment is instructive on the disproportionality of dismissal for a good-faith administrative act that amounts only to an error of judgment.