Sexual harassment at the workplace is not something new, but it has been making headlines in Malaysian news over the past few months due to several high profile cases.  It is therefore fitting that the recent Industrial Court Award in the case of Shamshir Alam bin S M Khairuddin v IBFIM (Award No. 662 of 2019, 21 February 2019) addresses the approach that will be taken by the Industrial Court when an employee is dismissed for sexual harassment.

Brief Facts
  • The Employee was alleged to have committed 3 acts of sexual harassment against the Complainant.
  • The Complainant did not report directly to the Employee, but the Complainant’s superior did. As such, the Employee was higher in the hierarchy of the organisation compared to the Complainant.
  • The 3 allegations of sexual harassment are:
    • The Employee held the Complainant’s arm and uttered the words “sedap jugak pegang lengan kau ni” (“it feels good to hold your arm”), on the pretext that he wanted to see her watch
    • The next day, the Employee went to the Complainant’s cubicle and caressed her arm
    • On another occasion, the Employee went to the Complainant’s cubicle and massaged the area around her thumb, on the pretext that it would ease her migraine
  • The Complainant lodged a complaint with the CEO of the Company and requested for a transfer out of the unit as she no longer felt comfortable working with the Employee
  • A domestic inquiry was held whereby the Employee denied the first two allegations as he could not recall the incidents. As for the third allegation, the Employee admitted to massaging her palm but said that he did this to ease her migraine and to educate her on reflexology.
  • During the domestic inquiry, the Employee offered to resign.
  • The domestic inquiry panel did not come to a finding on the first and second allegations on the basis that it was a “he said, she said” case. For the third accusation, they found him guilty on the basis of his admission. However, the domestic inquiry panel also noted that the Employee had “good intentions” and had “tendered his apology unequivocally”.
  • As such, the domestic inquiry panel recommended that the Employee’s offer to resign be accepted.
  • However, the CEO re-evaluated the evidence and found the Employee guilty of all 3 charges. The CEO recommended dismissal to the Board, which was accepted as the Company viewed sexual harassment as a very serious offence.
  • The Employee was therefore dismissed with immediate effect.
  • The Employee filed a complaint of unfair dismissal.
The Test for Dismissals involving Sexual Harassment

The Industrial Court noted that in the past, where there was a dismissal based on an accusation of sexual misconduct, the Court tended to take a more criminal approach meaning that it treated sexual misconduct as if it were dealing with a criminal offence. However, in 2002, this matter was set right by the decision of the Court of Appeal in Telekom Malaysia Kawasan Utara v Krishnan Kutty Sanguni Nair & Anor [2002] 3 CLJ 314 CA which held that even where a dismissal is based on a criminal act, the standard of proof in the Industrial Court is the civil standard of a “balance of probabilities” (and not the higher standard of “beyond reasonable doubt”).

In other words, the Industrial Court does not need to decide for itself whether the charge framed against the employee was established to its satisfaction; the Industrial Court has only to be satisfied that the management was justified in coming to the conclusion that the charge against the employee was well founded.

The test in an unfair dismissal case involving misconduct is therefore not “did the employee do it?” but rather, “did the employer act reasonably in thinking that the employee did it, and did the employer act reasonably in dismissing him?”

Industrial Court’s Findings

The Industrial Court held that in an unfair dismissal case, the dispute is an employment dispute and not a criminal prosecution for sexual harassment. As such, the burden of proof on the employer is “not a heavy one”.

The Industrial Court did not ask itself whether the employer had proved the truth of their facts to the satisfaction of the Court, but rather whether there were “solid and sensible grounds” for forming their factual considerations and whether the employer was actuated by any sinister motives.

In evaluating the evidence, the Industrial Court found that the Complainant had been subjected to sexual harassment by the Employee.  Having seen and heard the testimony of both the Complainant and the Employee, the Industrial Court also accepted the testimony of the Complainant. The Industrial Court was not convinced with the Employee’s feeble denial of the charges, and there was no reason why the Complainant would suddenly lodge a serious complaint against the Employee if the allegations were not true.

In finding that the Employee was fairly dismissed, the Industrial Court held:

“Sexual harassment is characterised by power imbalances between the victim and harasser as in the present case… the Company had a sexual harassment policy which was set out in the Company’s Code of Conduct for Sexual Harassment and in the Staff Handbook. The Claimant was aware of it. Instead of showing leadership, the Claimant breached the Code and caused embarrassment to the Company, which practised Islamic values. The breach had made his position in the Company untenable. I hope that this case will open the eyes of would be harassers that it is just not worth it, as one may end up losing a good job and worst still causing pain to one’s family.” (emphasis added)

Takeaways

This recent Industrial Court decision reaffirms the position that an employer does not need to prove “beyond reasonable doubt” that an employee committed sexual harassment, but rather the employer must merely show that it had solid and reasonable grounds to believe that the employee committed the offence.  Ascertaining the threshold is important, as sexual harassment is usually committed in private and in the absence of witnesses. It usually ends up becoming a “he said, she said” case (as described by the domestic inquiry panel), or one person’s word against the other.  Therefore, it is pivotal to understand the legal threshold that must be met by employers before they can dismiss an employee for sexual harassment.

One interesting element of this case is the fact that the CEO disagreed with the recommendations of the domestic inquiry panel. Although a domestic inquiry was held, the CEO re-evaluated the evidence on his own and found the employee guilty, and recommended dismissal to the Board. The Industrial Court, while referencing this process, did not explicitly find anything wrong with it in light of the fact that there is no evidence that the Company had been actuated by any sinister motives in taking action against the Employee, especially since the Employee had admitted to one of the allegations.  As such, the management can disagree with the findings of a domestic inquiry and mete out its own punishment, provided that it is reasonable in the circumstances and the management is not acting in bad faith.

This Industrial Court decision may hopefully alleviate the concerns of employers who are afraid to take the harsh punishment of dismissal against sexual harassers without “hard proof”.  It is hoped that this decision will empower employers to take a tougher stance against sexual harassment at the workplace.

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This article was written by Donovan Cheah. Donovan has been named as a recommended lawyer for labour and employment by the Legal 500 Asia Pacific 2017, 2018 and 2019, and he has also been recognised by Chambers Asia Pacific and Asialaw Profiles for his employment law and industrial relations work. 

Donovan & Ho is a law firm in Malaysia. Our practice areas include employment law, dispute resolution, tax advisory and corporate advisory.  Have a question? Please contact us.

 

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