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Industrial Court rules that a graduates training programme is not an employment contract

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Wong Keat Ching and Teoh Alvare from ZUL RAFIQUE & partners’ Employment & Industrial Relations team succeeded in defending PricewaterhouseCoopers ( “PwC”) in an unfair dismissal claim in the case of Yong Pui Yee (the “Claimant”) v PricewaterhouseCoopers (Award No 4 of 2021), Industrial Court.

In 2012, the Claimant commenced her employment with PwC as an Associate under the CIMB Fusion Programme (the “Programme”)/ACA Tripartite Training Contract (the “ACATT Contract”) which is a four-year training programme that provides a fresh graduate with two separate experiences under two organisations i.e. PwC and CIMB Investment Bank Berhad (“CIMB”). The Programme comprised of separate fixed term employment contracts, wherein: (i) during the first two years of the Programme, the Claimant was employed by PwC; (ii) in the third year of the Programme, the Claimant was employed by CIMB; and (iii) in the final year, the Claimant would be employed back by PwC. The Claimant completed her first fixed-term contract with PwC and her fixed term employment contract with CIMB expired on 1.7.2015. Subsequently, PwC and CIMB jointly decided to remove the Claimant from the Programme on the basis that during her stint with CIMB, she did not meet the performance expectations and requirements expected under the Programme.

Notwithstanding the third employment contract was not executed with PwC, PwC nevertheless out of goodwill made four offers of fixed term contracts on terms that were no less favourable than if the Claimant had continued as a fourth-year Associate under the Programme. The Claimant rejected the offers. The Industrial Court found that PwC had to the best of their ability tried to place the Claimant back on track, just to make sure she completed the 48 months of training to fulfil the requirements of the Institute of Chartered Accountants in England and Wales (“ICAEW”) membership. The Claimant remained steadfast in her rejections of the Company’s offers, which, if she had accepted in good time, would have seen her complete her training and qualify for the ICAEW membership. The Claimant’s rejections of the offers and her demands were unreasonable under the circumstances.

The Claimant contended that the Programme was an employment contract by itself and her removal from the Programme at the end of her third year, without being offered the third employment contract with PwC for the final fourth year, amounted to a dismissal. PwC argued that there was no dismissal in law as there was no existing employment contract between the Claimant and PwC at the time of her removal from the Programme. The Industrial Court held that there did not exist another employment between the Claimant and PwC at the point of her removal from the Programme. The Court found that the Programme and the ACATT Contract was not an employment contract. The ACATT Contract did not spell out any terms of employment. If it was intended by the parties to be an employment contract, there would not arise any need to insert specific clauses in the ACATT Contract with regards to the entry into separate fixed term employment contracts by the Claimant with PwC and CIMB. The first two fixed term employment contracts had expired by effluxion of time and the third fixed term employment contract between the Claimant and PwC was not even executed at the time of her removal from the Programme.

On the issue of the Claimant’s behaviour not being aligned with the requirements under the Programme, the Claimant contended that PwC had failed to provide any warning letter to her and that PwC did not take the initiative to find out whether CIMB’s allegations about her performance were true. PwC contended that during the performance evaluation the Claimant was still an employee of CIMB. As such, it was not for PwC to interfere with CIMB’s actions and PwC had trusted CIMB’s judgment in assessing performance according to their performance management system for trainees. Furthermore, the performance evaluation done during her employment with CIMB did not involve PwC. The Court held that the strict requirement of warnings for poor performance of permanent employees would not be applicable in this case. This is because the Claimant was a trainee and her employment with either PwC or CIMB was not even guaranteed at that point in time. Thus, the warning for poor performance is not essential in cases involving trainees under a graduate programme.

The Court concluded that the CIMB Fusion Programme and the ACA Tripartite Training Contract was not an employment contract under which the Claimant could assert her rights under Section 20[1] of the Industrial Relations Act 1967. Since there was no issue of unfair dismissal in this case, the remedy of reinstatement is not applicable.



For more insight into this area of law, please contact our Partners in the Employment & Industrial Relations Practice Group:
P Jayasingam
Wong Keat Ching
Thavaselvi Pararajasingam
Teoh Alvare
 
 
[1] Representations on dismissals