Domestic Inquiry

Definition

An employer-led investigation aimed at discovering facts and information about a situation in which an employer has accused an employee of misconduct. A domestic inquiry typically follows a ‘show cause’ letter, which is sent to the employee requesting a written explanation for the alleged misconduct. If the response is not satisfactory, the employer will move to the more formal domestic inquiry.

Domestic inquiry should be carried out as soon as possible following accusations of misconduct and all activities should be formalized and recorded in full. Legally it is important than the investigation be carried out objectively. The investigating officers, for example, should be unconnected to the incident, and the employee should be given full opportunity to state their own case and present evidence in their favor. Union representatives or colleagues should be allowed to sit in during the process if the employer allows their presence, although the employee can’t insist on legal representation.

Note that the domestic inquiry is purely an information-gathering exercise i.e. the panel tasked with gathering the evidence do not make decisions over guilt or punishment. Their final report is sent to the relevant parties, often senior leaders, who then decide on the appropriate course of action.

Under Malaysian Law

Under Malaysian law, where an employee is subject to the Employment Act 1955 ("Act"), it is a statutory obligation imposed on the employer to conduct a "due inquiry" to ascertain whether an employee is guilty of misconduct before an employee can be dismissed or before any other major penalty is imposed.

However, Section 14(1) of the Act does not specify what amounts to "due inquiry" or how an inquiry should be conducted. While "due inquiry" has a different meaning from "domestic inquiry", some people use these words interchangeably. While a domestic inquiry, if done properly, can amount to "due inquiry" under the law, it does not necessarily mean that a full blown domestic inquiry must be conducted in every case.

Given the complexity above, it natural to find employers (especially those without a proper HR support) who are clueless as to how to conduct a domestic inquiry. The consequence can be serious as a failure to properly conduct an inquiry could result in an unfavourable finding from the Industrial Court in the event the employee files an unfair dismissal claim.

As a general rule, it is important to remember that no employee should be dismissed for misconduct unless the employee concerned has been given an opportunity to defend himself or has been given an opportunity to be heard.

In order to allow employees to properly defend themselves, employers can hold a domestic inquiry which will help them decide whether the misconduct was committed and what sort of punishment should be meted out.

Employment Act 1955

Section 14 (1)

An employer may, on the grounds of misconduct inconsistent with the fulfillment of the express or implied conditions of his service, after due inquiry:

a) dismiss without notice the employee; or

b) downgrade the employee; or

c) impose any other lesser punishment as he deems just and fit, and where a punishment of suspension without wages is imposed, it shall not exceed a period of two weeks.

Section 14(1) above only mentions "due inquiry" but does not provide specific procedures as to how an inquiry should be conducted. Initially employers especially those without proper HR department, had to do what they thought best. Their actions had been challenged and the Industrial Court had handed over numerous decisions on the necessity of holding "domestic inquiry". The Industrial Court always held that natural injustice had not been done if an employer did not hold an inquiry or proper inquiry and the Court would invariably rule against the employer who failed to do this. It is an important principle that no employee should be dismissed for misconduct unless the employee concerned has been given an opportunity to defend himself or had been given an opportunity to be heard.

In order for a domestic inquiry to be properly held, certain procedure needs to be followed. Stated below are some guidelines for a proper inquiry:

Serve on the employee alleged to have committed misconduct a letter containing

• Specific charge of the type of offence, the date, the time and place where the offence took place. Also state which rules or regulations of companies have been violated.
• The date, the time and the place where he has to be present for the inquiry.
• Inform him his right to bring along witnesses if any.
• If necessary, suspend him for not more than two weeks pending the inquiry.

Show Cause Letter

It is important to state the allegations of the misconduct clearly and precisely to the employee. This letter is to call for an explanation for the alleged misconduct and to allow the employee to defend or explain the situation, as well as to state why the employee believes disciplinary should not be taken. A timeline to respond to such letter must be stipulated in the letter. Also, the show cause letter should be drafted in a clear and unambiguous language. Whenever possible, the relevant clause of the company's policy and/or employment contract should be cited.

Example of a badly drafted show cause letter:

"You have breached Company policy and procedure relating to the approval of payment vouchers."

What would be better:

"On 23 January 2015, you had approved payment voucher no. 12455 dated 21 January 2015 ("Voucher"). The Voucher was for payment of the sum of RM10,000.00 to ABC Sdn Bhd for purchase of stationery. As set out in the Company's Approval Authority Matrix, you are only authorised to approve payments up to RM5,000.00 only and any payment exceeding this amount must be referred to and approved by the General Manager. Your approval of the Voucher in excess of your approval authority limit is in breach of the Company's policies and procedures relating to the approval of payment vouchers as set out in Clause 3.5 of the Controller's Handbook."

Response to the Show Cause Letter

The employee should respond the show cause letter within the stipulated timeframe. If the explanation is acceptable or satisfactory, no punishment should be imposed. However, if the employee fails to respond and/or if the explanation is unacceptable, the Company can either (a) take disciplinary action; or (b) if it feels the allegations are serious enough to warrant it, issue a notice of domestic inquiry.

Issuance of Notice of Domestic Inquiry

The Notice of Domestic Inquiry should comprise of the following:-

• specific charge which states the type of offence, the date, the time and place where the offence took place
• details of the domestic inquiry (ie: date, time and place)
• inform the employee his/her right to bring along witnesses or any documentary evidence, if any.
• Suspension

If it is necessary, the employer may place the employee on suspension pending further investigation of the allegation in respect of the misconduct. The suspension can be issued together with the show cause letter, or before the domestic inquiry. A suspension may be granted if the employer feels that it would prevent interference into the investigation or further misconduct.

Under the Act, the maximum period of suspension is not more than 2 weeks with half wages. However, the employer must pay back the remaining wages to the employee if he is later found to be not guilty.  This maximum period of suspension only applies to employees subject to the Act.

Set up a panel comprising of

• Chairman 
• Two independent panel members 
• A prosecutor 

The panel (odd number of persons) must consists of people who are neither directly nor indirectly connected to the matter. Panel members should be employees who are of a higher rank or seniority than the accused employee. Ideally, the employee's direct manager should not sit on the panel as it could give the appearance of bias. To ensure that the domestic inquiry is conducted adequately, the chairman of the panel should have some knowledge of the domestic inquiry process, procedures and regulations relating to employment law.

In the hearing

• The Chairman will begin first by introduce himself and another two panels. Then the Chairman will ask whether the Alleged Employee accept him and the other two panels. If alleged employee accept then the Chairman will continue to read the charge and ask whether alleged employee plead guilty or no. If the alleged employee did not accept the Chairman or the panel alleged employee must state why with reasonable excuse and the matter should be table to the management.
• If the alleged employee pleads not guilty the prosecution will begin first. He is to make out a case against the accused first by producing witnesses who have direct knowledge of case.
• The accused i.e. the employee alleged to have committed the offence, is allowed to question (cross examine) each of the witnesses on the evidence they have given
• After that the accused will be asked enter his defence i.e. to tell his side of the story
• The accused may produce witness or witnesses to support what he has said
• The accused as well as his witnesses are subject to cross examination by the prosecutor.
• The chairman will guide the proceeding and to record the evidence in writing
• Tape-recording of the proceeding may be used.
• Lawyers are not allowed to appear in this type of domestic inquiry but official of the employee's union is allowed.

After the hearing

The panel will discuss the hearing and study the evidence given by both parties and the chairman will submit the panel's finding and recommendations to the Management

Management's decision

• dismiss without notice the employee; or
• downgrade the employee; or
• impose any other lesser punishment as he deems just and fit, and where a punishment of suspension without wages is imposed, it shall not exceed a period of two weeks.

2017 tahun suram, ekonomi negara kian tenat

50, 000 hilang kerja.

2017 tahun suram, ekonomi negara kian tenat.

Rakyat negara ini melangkah ke tahun baharu dalam suasana ekonomi yang semakin parah sehingga jumlah pekerja yang dijangka akan diberhentikan oleh pihak majikan pada tahun 2017 akan terus meningkat antara 45,000 hingga 50,000 orang seperti yang dijangkakan oleh Persekutuan Majikan Malaysia (MEF).

Produk dan perkhidmatan di pasaran tempatan serta eksport kekal lemah sehingga menyebabkan harga barangan tidak stabil dan seterusnya menyebabkan syarikat berdepan kesukaran apabila keuntungan merosot dan terpaksa membuang pekerja. 

Keadaan ini pasti menyebabkan rakyat yang sudah amat terbeban dengan kos sara hidup yang semakin meningkat setiap hari menjadi semakin terhimpit.

OLD THINKING V. NEW THINKING

Survey - Employee Engagement Questions

1. Do you know what you should do to help the company to meet its goals and objectives?

2. Can you see a clear link between your work and the company's goals and objectives?

3. Do you understand the strategic goals of the broader organization?

4. Does your team support you to complete your work?

5. Does your team inspire you to do your best work?

6. Are you proud to be part of your team member?

7. Do you have a good understanding of informal structures and processes at the organization?

8. When something unexpected comes up in your work, do you usually know who to ask for help?

9. Do you have the appropriate amount of information to make correct decisions about your work?

Above are the nine question that will help managers look for the kind of meaningful engagement with employee to improve employee understanding and performance.

Foreign Worker Policy needs to be ironed out

The Cabinet yesterday decided to put on hold a decision on foreign worker until a clear and firm decision is made on the procurement process, said International Trade and Industry Minister Mustapa Mohamed.

He said there were a lot of challenges with the policy because the country is in a transition period from the old to the new system.

He said the issue raised now were the manifestation of the problems faced in any change.

Mustapa, fondly known as Tok Pa added the Cabinet decided that there has to be a proper working paper on this issue before moving to the next level.

Even though the Cabinet had agreed on several decisions yesterday it could only move to the next level once firmer decisions were made, he said.

Mustapa added any decisions made were crucial to local companies and labour policies, and due to that, the whole "eco-system' needs to be put in place, adding that is why the government is in continuous engagement with the private sector.

Yesterday, Transport Minister Liow Tiong Lai said the Cabinet had agreed to postpone to next year, the implementation of levy payment on foreign workers by employers, which will be enforced under the Employment Mandatory Commitment (EMC).

Some of the issues that need to be ironed out are levy posed on foreign workers, the right of the employer to have direct access to the workers, rather than going through a middleman, and ways to cut down bureaucracy for faster employment of foreign workers.

On Dec 31, Deputy Prime Minister Ahmad Zahid Hamidi, who is also home minister, had announced employers would be responsible for paying the levy of their foreign workers which would be enforced under the MEC.

On Jan 6, Parti Sosialis Malaysia had said it wanted the government to end the "inhuman practice" of allowing employers to deduct foreign workers' levy from their monthly salary.

PSM central committee member Rani Rasiah had said most of the foreign workers were not told of the deductions when they were recruited but only knew about it when they landed in Malaysia.

Rani had said levy was charged on employers for hiring foreign labour instead of locals and had suggested raising the cost of migrant labour for the employers to compel them to recruit more locals and in the long run, reduce the country's dependence on migrant workers.

Sarawak Chief Minister Adenan Satem dies

Sarawak Chief Minister Adenan Satem passed away this afternoon from heart complications, just two weeks shy of his 73rd birthday.

Adenan, who led the Barisan Nasional (BN) to a resounding victory during the last Sarawak election, died at the Sarawak General Hospital Heart Centre in Samarahan.

He leaves wife Jamilah Anu and five children.

Adenan replaced long-serving chief minister Abdul Taib Mahmud on March 1, 2014.

In 2010, he became Taib's special adviser, later succeeding him as the 5th chief minister.

Contract of Service & Contract for Service

Contract of Service & Contract for Service from Hanif Zulkifli

SIJIL CUTI SAKIT (MC) PALSU

Pihak PDRM berjaya menumpaskan sindiket penjualan SIJIL CUTI SAKIT atau MC PALSU yang semakin berleluasa.

Penjualan MC PALSU ini telah banyak mengakibatkan ramai pekerja mengambil jalan mudah untuk memberi alasan tidak hadir bekerja malahan sanggup membayar sejumlah wang untuk MC PALSU ini tanpa menyedari ianya boleh mengakibatkan periuk nasi mereka tergadai.

Tahniah diucapkan kepada PDRM atas tindakan pantas. 

Laporkan segera kepada pihak berkenaan sekiranya anda mengetahui tentang sindiket MC PALSU. 

PROBATION

Employees on Probation

• The Employment Act does distinguish between a employee under probation and other employees.
• He enjoys all the same rights as any other confirmed employee.

Why probation?

A new employee will invariably have to go through a period of probation enabling the employer to test his or hers suitability of the job he or she is engaged to do. Qualification and skill alone may not make one a good employee, other factors such as aptitude and attitude towards work and fellow workers must also be tested before he or she can be confirmed to take on the job.

The probationer was found to be lacking in certain areas, can he or she then to terminated on or before the end of the probationary period?

It is quite common to find a clause in the contract of service like "..during the probationary period, either party may at any time terminate the contract of service without notice...." and many employers simply make use of the clause to terminate the service of a probationers whom they find to be not to their liking. 

Employers must be careful about doing this. When a new employee first came to the company, he or she must be given training in the job he or she is supposed to do. After due training the employee still could not do the job properly, he or she must be warned, at first verbally and then in writing or extension of the probationary period if things persist. If there is no improvement despite all that, then he or she is told to go when the probationary period expires. Even in a case of serious misconduct, an employer may not dismiss the employee summarily without first enquiring into the matter.

In Khaliah binti Abbas vs Pesaka Capital Corporation Sdn Bhd, the Court of Appeal ruled that an employee on probation enjoys the same rights as a permanent or confirmed employee and he or she cannot be terminated without just cause or excuse.If a probationer feels that he or she is terminated without just cause or excuse, he can seek redress under Section 20 of the Industrial Relations Act 1967 for wrongful dismissal.

A probationer who receives no confirmation after the end of the probationary period, is he or she considered confirmed or not confirmed?

In Consolidated Plantation Berhad vs All Malayan Estates Staff Union, the Federal Court held that if an employee continues employment after probationary period, he is still an probationer. In this case an Indian Supreme Court case was cited and in that case, it was held "There can .... no doubt about the position in law that an employee appointed on probation for six months continues as a probationer even after the period of six months if at the end of the period his services had neither been terminated nor confirmed." However, if an probationer who receives no confirmation after the probationary period but is given a salary increment, he or she definitely has a strong case that the employer is satisfied with his or her performance.

Again, the position will be different if there is a clause in the contract of service stating that when no confirmation is received after the probationary period, the employee is deemed to be confirmed.