Can The Employer Give Different Punishment for The Same Misconduct?

Can The Employer Give Different Punishment for The Same Misconduct?

To illustrate this topic, we take a look at the case of Harianto Effendy Bin Zakaria & 8 Others v Industrial Court of Malaysia and another on the right employers have to impose differing punishment on employees who have committed the same misconduct. Differing punishment was meted out despite committing the same nature of misconduct by the employee(s).

may-day-2014-032The Federal Court in this case had upheld the dismissal of the employees (the “Employees”) by Bumiputera Commerce Bank Berhad (the “Bank”) despite the Bank imposing differing punishment on other employees of the Bank who committed the same misconduct.

Case Facts

We understood that all the Employees who were active members of the National Union of Bank Employees (“NUBE”) took part in a series of pickets in the month of October 2003. On 21 October 2003, the picketers, including the Employees, commenced the picket at approximately 12.30 p.m. outside the Bank’s branch on Jalan Tun Perak. Thereafter at approximately 1.25 p.m., the picketers moved to the side entrance of the Bank holding placards and balloons and barged through the side entrance despite attempts by the security personnel of the Bank preventing them from entering. The picketers proceeded to the lobby and entered the banking hall, disrupting the operations of the Bank. The incident was captured on the CCTV cameras of the Bank.

Although approximately 40 employees took part in the picket only 15 employees were issued letters of suspension by the Bank. Show cause letters were issued and a domestic inquiry was conducted in respect of the picket carried out in the Bank’s premises. The Bank then dismissed the Employees. The Bank did not, however, dismiss other employees involved in the picket from their employment.

The question that arose ultimately for the Federal Court was whether the Industrial Court was required to consider whether the punishment of dismissal was warranted and proportionate to the findings of misconduct by the employer.

In what circumstances, would differing punishment for the same misconduct be warranted?

One of the Employees’ main contention was that the Employees were dismissed by the Bank whereas five other employees were not, despite all of them entering the Bank as part of the picket. The Employees contended that the differing punishment meted out to the Employees as opposed to the other employees amounted to unequal treatment and double standards by the Bank.

The Employees argued that the courts below failed to take into account this disparity in punishment and, if it did, it would have arrived at a different conclusion. The Bank took the position that the punishment that was meted out was warranted in the circumstances and the conduct of the Employees from the time the show cause letters were issued must be scrutinized in determining the punishment to be meted out.

The Federal Court held that the Bank had acted reasonably in imposing differing punishment for the following reasons:

(a) Three employees were found not guilty by the domestic inquiry held by the Bank

(b) The Bank had taken into account the plea of mitigation of one employee and imposed a two-year increment freeze as punishment for that employee

(c) The Bank had taken into account the written explanation of another employee and issued a caution letter in that case

(d) Two employees apologized for their actions and this was taken into consideration

(e) The Employees did not apologize for their conduct despite being given the opportunity to do so, and

(f) The Employees showed no remorse for their actions.

The Federal Court held the above factors were correctly taken into consideration by the lower courts and that the Bank was justified in imposing differing punishment for different employees by reason of such factors.

This suggests that an employee’s conduct post discovery of the misconduct will be considered in determining the punishment to be meted out in each case. A dismissal by the Bank of all employees involved in the picket, whether or not they had shown remorse or expressed regret for their actions, may have been too harsh a punishment and would have resulted in a failure to take into account the conduct of the employees after the offence was established.

Such post offence conduct are important factors that an employer must consider before any punishment is handed out.

The Federal Court affirmed by its decision that, where employees have been charged with the same misconduct, this did not require the employer to impose the same punishment on all the employees so charged.

The fact that the employees were long standing employees of the Bank with no record of previous misconduct or past disciplinary records did not mean that the punishment of dismissal was not available. The Federal Court held that there is no fixed rule of law to suggest that it was unreasonable to dismiss an employee with an unblemished record for a single instance of insolence.

The Federal Court held that the punishment to be meted out would depend on the nature of the misconduct itself. In this case, the actions of the Employees in carrying placards and balloons, noisily distracting customers and colleagues and releasing the balloons in the banking hall amounted to a grave misconduct, involving the core of the Bank’s business, which was service rendered to members of the public. The Federal Court, in holding that the dismissal by the Bank was proportionate to the misconduct, agreed with the Court of Appeal’s observations that in view of the gravity of the charges against the Employees, they must have been aware that dismissal would have been the inevitable punishment.