A three-member bench chaired by Justice Lee Swee Seng awarded RM893,000 to Woon Kim Choy and RM1.151 million to Chang Heng Keong, after holding it would not be feasible to reinstate them to their posts with Acexide Technology Sdn Bhd.
Woon, a former technical director, and Chang, an ex-project director, drew monthly salaries of RM19,000 and RM24,500, respectively, including allowances.
The bench also ordered Acexide Technology to pay interest of 8% per annum on the sums awarded, calculated from Aug 9, 2022 until full settlement.
Lee, who sat with Justices Azimah Omar and Azizul Azmi Adnan, also ordered the company to pay Woon and Chang, who had been with the company for 23 years, RM20,000 each in costs.
“This court allows the two appeals and quashes the dismissal of their claims by the Industrial Court. We have set aside the order of the High Court and made an order for compensation in lieu of reinstatement,” he said in the 37-page judgment released earlier this week.
The judge said Woon and Chang were “workmen” within the meaning of the Industrial Relations Act 1967, and that the Industrial Court had jurisdiction to hear their complaints of unfair dismissal.
Lee added that the employer did not adduce evidence to prove their alleged misconduct and, as such, their dismissals were without just cause or excuse.
“There was no show-cause letter nor any domestic inquiry held nor any evidence adduced at the Industrial Court to justify their dismissal,” the judge said.
Woon and Chang, together with BH Lim were promoters of Acexide Technology when the company was incorporated in late 1996.
The duo went on to become shareholders as well as directors of the company. Lim, together with his son, Jovin, were the majority shareholders with 54% equity, while Woon had 10% and Chang 36%.
The company is involved in the installation and maintenance of fire lighting systems, trenchless technology and transportation.
Lim and Jovin, by sheer strength of their majority shareholding, convened an extraordinary general meeting on Nov 6, 2019 to remove both Woon and Chang as company directors.
The judge said shareholders possess unfettered discretion to remove directors and that judicial intervention was unwarranted as long as the removal process adhered to statutory requirements and the company’s constitution.
However, Woon and Chang filed a complaint at the industrial relations department claiming to have been unlawfully dismissed from their employment with the company.
In his judgment, Lee said that although Woon and Chang were company directors, they were also employees of the company.
“Thus, they may wear two hats – as a director under the Companies Act and as one of the most senior and highest-ranking staff of the company, reporting to the board of directors,” he said.
He said the company had treated the duo as its employees, as evidenced by their listing in the register of employees and statutory contributions made on their behalf.
Lee said Woon and Chang’s removal as directors did not affect their status as employees of the company.
The appellants, as “workmen”, were entitled to seek the remedy of reinstatement or compensation in lieu of reinstatement as the Industrial Court had jurisdiction to hear the dispute, the judge said.
Gavin Jayapal and M Kausalyaa appeared for the appellants while Khoo Wai Tuck and Wayne Lim acted for the company.