Former COO Awarded RM2.5m for Unjust Dismissal

A former COO and executive di­­rec­tor of Konsortium Transna­sional Bhd has been awarded nearly RM2.5mil for unjust dismis­sal.

The amount is considered to be one of the highest in recent times for back wages and compensation in lieu of reinstatement. Apart from this amount, the company is to pay another RM442,000 for Employees Provident Fund contribution.

The chairman of the Industrial Court, Fred­rick Indran XA Nicholas ordered that the amount be paid to Tengku Mohd Hasmadi Tengku Hashim within the next six weeks. Lawyer S. Muhendaran, who ap­­peared for Tengku Mohd Hasmadi, said the RM2.46mil was obtained from 36 months of his client’s last drawn salary.

According to the court award, Tengku Mohd Hasmadi declared constructive dismissal from April 1, 2015, when, upon returning from an annual leave he realised that part of his job and responsibilities were taken over by Muhammad Hariz Mohd Nadzmi, the son of Tan Sri Mohd Nadzmi Salleh, the company’s chair­man.

Industrial Court. Picture by User:Two hundred percent - None, CC BY-SA 2.5, Link

Tengku Mohd Hasmadi felt not only humiliated but that the move also threatened his position and authority as the COO and executive director.

Prior to the said measures, Tengku Mohd Hasmadi was the only one responsible for the group operations and the group support servi­ces. He managed 10 subsidiaries within the group which covered about 3,000 employees.

He disputed that the purported “restructuring”, which was to take effect from April 1, 2015, was, in fact, the rearrangement of only his roles and responsibilities, and no one else, and done without any notice, consultation or permission by him.

“This exercise removed a consi­derable part of the claimant’s responsibilities, which was handed over to the company chairman’s son – a 27-year-old at the time who, according to the claimant, had not even finished his studies,” Fredrick recorded in the award.

The company refuted the claim and stated that the restructuring was real. The company said it even offered to return two departments to be under Tengku Mohd Hasmadi to quell his dissatisfaction.

But it was to no avail. Tengku Mohd Hasmadi declined to report back to work as instructed while declaring that the breach had not in fact been remedied.

According to the award, Mohd Nadzmi declared in court that this exercise was his “succession plan” for what he understood to be his company, notwithstanding that it was, in fact, a public listed company.

The court held that the restructuring of Tengku Mohd Hasmadi’s duties and responsibilities was almost by way of an ambush. “The company abandoned its responsibility to appropriately address the issue, or indeed address it at all effectively, in order to correct the situation in a fair and rational manner.

“All that was actually said in this court was that the organisational chart was readjusted for the third time to seemingly, but not actually put the claimant back into his original position.

“In the whole scheme of things in this case, it certainly comes across as a colourable exercise of managerial authority and is clearly tainted by unfair labour practice,” said Fredrick, ruling the dismissal as unfair.

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Source: The Star