A good real case study of constructive dismissal, that ended up the claimants (ex-employees) on the losing end. Taken from The Star:
KUALA LUMPUR: Three Malaysian Airline System Bhd (MAS) senior pilots have failed in their constructive dismissal claim with the Industrial Court ruling that their demotion for misconduct was fair.
Industrial Court chairman Eddie Yeo Soon Chye said pilots Azlan Zainal Abidin, 54, Ahmad Kamil Shahperi Shahibi, 50 and Samsudin Zainol Abidin, 56, had failed to prove that they were constructively dismissed by the airline.
“The respondent’s (MAS) decision to demote the claimants in this case could not be the subject of a claim for constructive dismissal.
“This court is of the view that the punishment of demotion against the claimants was meted out fairly,” he said.
He said there was clear evidence that the claimants had engaged in the aviation business as directors of Asmara Air Services Sdn Bhd without prior written permission from MAS as required under the exclusive service provisions of their employment contract.
“The respondent refrained from dismissing the claimants after the domestic inquiry proceedings and kept the claimants in employment, albeit in a demoted position which did not entail any reduction in their salaries and benefits,” Yeo added.
Yeo also said that a demotion imposed following a disciplinary hearing was not a breach of contract when it was a lesser penalty than a dismissal that could otherwise have been imposed.
“If the employer has acted fairly, and with the interests of the employees at heart, such dismissal will be fair,” he ruled in his May 21 dated award.
“The right to downgrade a workman pursuant to a finding of guilt of a charge of misconduct was a form of disciplinary action open to the employer under its inherent right to impose the appropriate punishment.”
The three pilots joined MAS between 1975 and 1979 and the last posts they held was as Pilot Captain B747-400 with a last drawn salary in excess of RM27,000.
The pilots received a letter dated Dec 8, 2004, from MAS saying that they were involved in the formation of Asmara Air Services Sdn Bhd without prior permission of the company, which amounted to misconduct.
They replied to the company on Dec 14, 2004, denying the allegations.
However, a domestic inquiry found them guilty of misconduct.
MAS then issued a punishment order against them in the form of demotion of their positions.
The claimants in separate letters sent to MAS dated March 28, 2006, said that they considered themselves constructively dismissed.
MAS was represented by lawyer Datuk Thavalingam Thavarajah while counsel Subitra Ravindran acted for the claimants.