Court chairman Nur Fauzah Mokhtar said she was not satisfied that the lecturers’ positions at Widad College had become redundant to justify their retrenchment, and was not convinced that the selection of the lecturers was made in line with the general principles of retrenchment.
She said Widad Education Sdn Bhd, which operates Widad University College and Widad College, did not provide sufficient evidence to prove it took real and significant cost cutting measures to avoid the retrenchment.
Nur Fauzah said the lecturers had established that the retrenchment was not conducted in good faith when the company terminated their employment on grounds of redundancy.
She said no other cost-cutting measures were taken, other than dismissing the lecturers, to reduce the college’s operating costs and expenses. The company also did not offer them any alternatives to being dismissed.
Nur Fauzah said none of the company’s witnesses was able to state conclusively what the retrenchment selection criteria were “despite the fact that they all sat in the management committee who made the decision to dismiss the lecturers”.
The claimants had proven on the balance of probabilities that the retrenchment was without just cause or excuse, she said in her award delivered on June 27. Their cases were heard jointly in December.
The lecturers had served from four to 20 years with the college, earning between RM2,100 and RM3,950 each. They were retrenched on June 30, 2021, after a three-month notice.
They lectured in the fields of mass communication, information and interactive multimedia, allied health sciences, computer sciences, quantity surveying, business management, medical laboratory technology, information technology, tourism management, art and design, accounting and business.
The sacked lecturers were awarded between RM51,150 and RM114,767 each as compensation in lieu of reinstatement, back wages and unused annual leave.
In their statements to the court, the lecturers said they were taken by surprise by the dismissal as there was no prior discussion or notice regarding the company’s status or financial situation.
They were not offered any alternatives, such as a reduction in salary and working days, or a transfer to another department or to Wadid University College. The company also forced them to take their unused leave without pay two weeks before their retrenchment, they said.
“The company had splurged by organising events from July 2021 until June 2022, such as a corporate dinner party at Sri Manja Boutique Hotel on Dec 16, 2021, even though it claims it had been suffering losses impacting its existing cash flow and finances,” the lecturers said.
However, the company denied having splurged on events such as the annual dinner, saying the funds used were those collected by the staff club and students.
In its reply, Widad Education said it suffered a total of RM19 million in losses for four consecutive years which affected its cash flow and existing finances. The company was also severely affected by a fall in student intake from 2016 to 2020.
The company said it made a profit only in 2016 and incurred losses in the subsequent years.
“The company had been unable to pay the salary of employees as well as those of former employees of Shahputra College, which it had bought over. Monthly tax deductions and EPF and Sosco contributions were also in arrears.
The company said the outstanding wages and statutory dues before the lecturers’ retrenchment amounted to RM5.89 million.