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Banking on Trust: Navigating an Employee’s Misappropriation of Cash

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23 January 2024

Wong Keat Ching together with Loh Qiao Wen from Zul Rafique & Partners’ Employment and Industrial Relations Practice Group have successfully acted for a Bank in an unfair dismissal claim by a former employee at the Industrial Court, wherein YA Tuan Zulhelmy Bin Hasan handed down Industrial Court Award No. 3 of 2024 dated 02.01.2024.

BRIEF FACTS
The Claimant was employed with the Bank as a Teller Clerk at the Company’s Ipoh Branch. On 22.01.2020, during the end of day balancing conducted by the Chief Cashier of the Ipoh Branch, it was discovered that a cash shortage of RM1,000.00 comprising of RM10.00 denomination had occurred. On 26.01.2020, a review of the Bank’s CCTV recording was undertaken and showed that the Claimant had obtained and received RM1,000.00 in cash from the Chief Cashier. The CCTV footage overlooking the cashiers' counters showed the Claimant putting a bundle of cash from his drawer into an envelope and then into his bag. Subsequently, the Chief Cashier recalled that the Claimant had requested RM1,000.00 from him without recording the cash request on the Bank’s iBranch System even though the Chief Cashier reminded the Claimant to do so. .

On 28.01.2020, the Chief Cashier and the Claimant was called in for interview before the Branch Manager on the cash shortage wherein the Claimant admitted he had taken RM1,000.00 in cash and he was instructed by the Branch Manager to return the said cash. The Claimant then returned the RM1,000.00 cash money in RM50.00 denomination notes to the Chief Cashier on the same day.
Subsequently, the Claimant received a Show Cause Letter, prompting a written explanation regarding the alleged misconduct. Thereafter, the Bank held a Domestic Inquiry, during which the Claimant pleaded not guilty. The Domestic Inquiry panel found the Claimant guilty of the charge of misconduct. Due to the severity of the misconduct, the Claimant was dismissed from the Bank's services.

The charge of misconduct for which the Claimant was found guilty related to the misappropriation of cash amounting to RM1,000.00 from the cash under his care as a Teller at the Ipoh Branch.

DECISION OF THE INDUSTRIAL COURT
During the trial, the Bank substantiated its case by presenting evidence that the Claimant took RM1,000.00 in cash from the Chief Cashier without recording it in the Company’s iBranch System and later taking it home—a clear act of misappropriation. The Claimant, while admitting to this, argued that his intention was to return the cash, believing it belonged to a customer. Despite the lack of evidence supporting personal use, the Industrial Court, after careful analysis, emphasized that the CCTV footage undeniably showed the Claimant handling cash and confirmed his deliberate retention of the excess funds. The Court dismissed the Claimant's contention of a genuine mistake, highlighting the absence of complaints from the purported customer.

Dismissal was with just cause and excuse
Regarding the severity of the punishment of dismissal, the Industrial Court emphasized that the deliberate act of misappropriation, especially the intentional retention of the excess cash for six days before returning it upon the Bank's discovery, indicated a serious breach of trust. Despite the Claimant's argument on the proportionality of the punishment, the Court held that the dismissal was justified based on the intentional nature of the misappropriation, reinforcing the importance of upholding trust and integrity in the employer-employee relationship.

In this instance, it marks the second occurrence of the Claimant being found guilty of misconduct related to cash handling. Given his role as the Bank's Teller and the associated responsibility of daily cash transactions, the Claimant is entrusted with a position of trust, demanding vigilance and diligence. He had received sufficient training to promptly report any cash shortages or excess. In the overall circumstances, considering the gravity of the proven misconduct, the Claimant's service record, and the Bank's business nature, it was concluded that the punishment of dismissal was aligned proportionately with the severity of the misconduct.

Key Takeaways
The case underscores the gravity of misappropriation, particularly in a banking context where employees are entrusted with handling public funds. The Industrial Court emphasized that intentional misappropriation, even for a temporary period, is considered a serious breach of trust and fiduciary responsibility. As such the act of returning the money did not absolve the Claimant from liability in the serious misconduct of misappropriation. Employers should establish clear policies regarding conduct, especially in industries dealing with financial matters. Regular training sessions, as demonstrated in this case, can help reinforce the expected standards of behaviour, especially the responsibility to report or declare any shortages or irregularities.

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