Industrial court awards in unfair dismissal claims : a methodical assessment guideline

Abstract

Unfair dismissal is a long-standing issue in employment. Unfair dismissal affects employees in terms of their rights such as salary, reputation, and other benefits such as their pension. As a primary remedy for unfair dismissal, many countries have implemented reinstatement in their legislation to secure employees' rights. However, reinstatement cannot be awarded in most cases due to the strained relationship between employer and employee. Most claimants have no desire to be reinstated mainly because they may have found new employment after their dismissal and are in most cases comfortably settled in their new job. Hence, laws were amended to introduce an alternative remedy which includes monetary compensation. As it currently stands, monetary compensation is the most preferred remedy for successful unfair dismissal cases including in Malaysia. However, there are ambiguities in the existing legislation in Malaysia concerning this alternative remedy as there is a lack of proper mechanism in its assessment. Hence, this research aims to carry out an in-depth critical analysis of the existing legal provisions with a view to determining their adequacy. This research will also concentrate on the determining factors and their evaluation process as carried out by the Chairman of the Industrial Court in a successful unfair dismissal claim. Additionally, the assessment of monetary compensation in the United Kingdom and New Zealand is also examined with a view to formulating effective methodical assessment guidelines for Malaysia. Employing a qualitative approach, the present study analyses the awards in unfair dismissal cases and practices of the Industrial Court in Malaysia for the period of 2010 to 2020. This methodological approach involves the traditional legal approach of analysing and critically evaluating available past literature, remedies for unfair dismissal cases, and varying perspectives of industrial practitioners on the legal framework concerning unfair dismissal remedies. The findings of the study consolidate the weaknesses and gaps in the provisions governing unfair dismissal under the Industrial Relations Act 1967, including the absence of methodical assessment guidelines and the severe inconsistencies in delivering awards. Hence, a reformation of the existing legislation, namely the Industrial Relations Act 1967, to provide a consistent and accurate calculation of monetary compensation is proposed. This reform is necessary for the benefit of multiple relevant parties, particularly the Industrial Court, to ensure an effective mechanism that upholds the rights of both employers and employees by accounting for the financial and non-financial aspects of both parties.