Industrial Court Awards Pilot RM511,200 in Compensation for Wrongful Dismissal
The Industrial Court has awarded a former pilot, Wong Zi Chuang, RM511,200 in compensation after ruling that AirAsia X Bhd had wrongfully dismissed him from employment under the guise of retrenchment.
Unfair Retrenchment Process
The court found that the airline’s selection process for retrenchment was unjust and did not follow the "last-in, first-out" (LIFO) principle prescribed under the Code of Conduct for Industrial Harmony. Instead, the company had chosen to implement its own "best fit" policy, which was not supported by law.
Lack of Evidence of Redundancy
The court also found that the airline failed to provide sufficient evidence to prove that Wong’s position had become redundant. The airline had claimed that Wong’s flight route had been permanently cancelled, but the court found the company’s witness to be evasive and unable to confirm the cancellation.
Use of Disciplinary Record
The court ruled that Wong had been identified for retrenchment based on his disciplinary record, rather than the redundancy of his position. The airline had used his past disciplinary and/or performance records, which had already been closed after he was served with a warning letter, to deem his position as being redundant.
Furlough Option Ignored
The court noted that Wong had volunteered to be placed on furlough, and was willing to work for up to six months for a "token sum" until the company’s financial situation improved. However, the airline ignored his repeated pleas and carried out the process of retrenching him.
Compensation Awarded
Paramalingam awarded Wong RM198,000 in compensation in lieu of reinstatement and RM432,000 in back wages, but deducted RM118,800 for post-dismissal earnings and salary in lieu of notice which the company had paid him.
Conclusion
The Industrial Court’s decision highlights the importance of fair and reasonable procedures in the selection process for retrenchment. Employers must demonstrate that the selection process is fair and based on objective criteria, and not arbitrary or discriminatory.
FAQs
Q: What is the "last-in, first-out" principle?
A: The "last-in, first-out" principle is a principle of retrenchment that states that employees who were hired last should be the first to be let go in the event of retrenchment.
Q: What is the "best fit" policy?
A: The "best fit" policy is a policy adopted by some employers to select employees for retrenchment based on their performance and other factors, rather than their seniority.
Q: Can an employer use an employee’s past disciplinary record to determine redundancy?
A: No, an employer cannot use an employee’s past disciplinary record to determine redundancy. The court has ruled that an employer must demonstrate that the employee’s position has become redundant, and not use past disciplinary actions to justify retrenchment.