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Case Update: Malaysian Apex Court sets strong precedent for trade union movement

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14 October 2022

EMPLOYMENT LAW
Trade Union – Union Leader – Press Statement – Suspended – Serious Misconduct – Breach of Express Terms – Industrial Court – Unfair Dismissal – Appeal

Ismail Nasaruddin Abdul Wahab v Malaysian Airline System Bhd
[2022] MLRAU 230 | Federal Court
- see the grounds of judgment here

Facts Ismail Nasaruddin (the “Appellant”) was an employee of Malaysian Airline System Bhd (“MAS”) for 25 years. At the material time, he was also the President of the National Union of Flight Attendants Malaysia (“NUFAM”). MAS (the “Respondent”) was the national carrier of Malaysia. Sometime in 2013, the cabin crew employees of MAS were disgruntled and unhappy with MAS for amongst others, a Fleet Realignment Exercise (“FRE”), which severely affected many cabin crew's schedules and wages. NUFAM referred the FRE issue to the Director General of Industrial Relations as a trade dispute. NUFAM and MAS failed to resolve the above issues. After which, the Appellant issued a press statement in his capacity as NUFAM President where he highlighted inter alia the plight of overworked and underpaid cabin crew members, and urged MAS to enact policies to ensure their welfare and safety. In the course of doing so, the Appellant called for the resignation of MAS' CEO as a result of the latter's inability to resolve the problems faced by the cabin crew under his leadership of MAS in 2011. Subsequently, the Appellant was suspended and issued a show cause letter describing his press statement as a "serious misconduct", tantamount to "a breach of the express terms of his employment" with MAS and further a breach of an implied term to serve MAS with "good faith and fidelity". Ultimately, the Appellant was dismissed and challenged the dismissal at the Industrial Court but was unsuccessful. A judicial review was then filed in the High Court to quash the decision of the Industrial Court. The High Court allowed the application and set aside the award of the Industrial Court. The Respondent appealed to the Court of Appeal, which was allowed. Dissatisfied, the Appellant filed an appeal to the Federal Court. Hence, this appeal. 

Issues 1. What is the extent of the protection afforded to an employee in respect of a charge of misconduct by an employer in relation to the employee's acts carried out in his capacity as a Trade Union officer or member having regard to the relevant legal principles?
2. Whether the dismissal of a trade union leader for participating in trade union activities is an act of victimisation and unfair labour practice?
3. Is a trade union officer speaking on behalf of the trade union obliged under the law to exhaust the trade dispute processes under ss 18, 19 and 26 of the Industrial Relations Act 1967 before issuing a press statement on the nature of such trade dispute? If the said trade union leader has not exhausted the above process, is the issuance of the said press statement an act of misconduct justifying dismissal?

Held In allowing the Appeal, the Federal Court held that the Court of Appeal erred in focusing solely on the Appellant’s obligations under his contract of employment or collective agreement without according any or sufficient consideration to his duties as President of NUFAM. The Court of Appeal also failed to give any consideration as to whether the acts were in furtherance of trade union activity. In doing so, the Court of Appeal disregarded the statutory provisions of the Employment Act, Industrial Relations Act, and Trade Union Act. The Federal Court further held that the contents of the Appellant’s press statement relate wholly to problems faced by employees at the workplace and criticism of the management for failing to address the same. The Federal Court held that the Appellant did not abused his office as union president for personal interest. The Appellant’s press statement was done in the name of NUFAM and for the benefit of the thousands of cabin crew members he represented with a view to improve workplace conditions. In the circumstances, the Federal Court held that the Appellant’s press statement amounted to participation in the lawful activities of a trade union and was not unreasonable, malicious, or knowingly or recklessly false. Accordingly, the Federal Court agreed with the High Court that the Appellant’s conduct cannot be labelled as misconduct which warrants dismissal. In conclusion, an employee ought not to be dismissed for participation in trade union activities carried out in his capacity as a trade union officer or member, unless the activities are extraneous to trade union affairs, or were carried out maliciously, or in a manner which knowingly or recklessly disregards the truth.

Zul Rafique & Partners
{14 October 2022}

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