Our Views

It is trite that in the event an employee does not leave employment immediately, the employee may be deemed to have condoned the employer’s actions which may have been a breach of an implied / express term of the employment contract. This position remains, although from the employer’s perspective, it may appear unfair that an employee may depart employment immediately, without the employer being given the opportunity to address the employee’s concerns.  

The Court of Appeal in Southern Investment Bank Bhd/Southern Bank & Anor v Yap Fat & Anor [2017] 3 MLJ 327, took the view that removal of certain duties and responsibilities from an employee’s portfolio did not suffice for constructive dismissal against the employee’s delay of approximately five months in leaving employment. The Court held that this delay illustrated that the employer’s conduct did not rendere the employee’s employment impossible, unreasonable and unbearable.

In another instance, where an employee had been receiving commission in addition to his salary throughout his employment but the employer then, revised the comission payout scheme. The employee despite beign aggrieved by the decision continued to remain in employment for some 9 months before claiming constructive dismissal. The Court of Appeal in Sanbos (M) Sdn Bhd v Gan Soon Huat [2021] 4 MLJ 924, considered the reasons behind the delay and the employee’s sugesstions that the delay so that:-

1. he could ‘collect evidence’ of his reduction of income; and 
2. he could receive monetary compensation in lieu of the loss of commission which was orally promised to him by his employer.  

The Court of Appeal held that the delay of nine months was lengthy and the reason for the delay contradicts the employee’s case, that the breach was so fundamental that he regarded himself as dismissed. That delay can defeat a claim in constructive dismissal, beg the question whether every delay on the part of the employee will result in failed claim for constructive dismissal? The simple answer is no.

The Court of Appeal was troubled with this issue in CIMB Bank Bhd v Ahmad Suhairi bin Mat Ali & Anor [2023] 5 MLJ, where the employee submitted that his transfer was a form of demotion in which unrealistic expectations were imposed on him without the support he needed. The bank on the other hand took the position that the employee did not protest his transfer and there was a delay on the employee’s part on departing from employment.  

The Court of Appeal held that when the employee walked out after a month and eighteen days of assuming his new role, and after having raised his grievances to the bank’s human resources department, with no response from the bank, the employee’s actions were reasonable and the delay duly explained. The Appellate Court took the position that had the bank required more time to respond, a ‘holding letter’ to inform the employee that his complaints were being addressed was necessary on the employer’s part.  

On the facts, the Court of Appeal held that even if there was delay on the employee’s part, such delay cannot be construed as an affirmation of the employer’s unilateral variation of the contract of employment. Throughout that period, the employee had made every effort to seek a good outcome and to extricate himself from the position in which the bank had put him through multiple emails but to no avail.

In essence, once a substantial breach of a contract of employment arises, the employee must act immediately either by trying to resolve the issue with the employer or by deeming himself as constructively dismissed. As far as the employer is concerned, there should be no material breaches of the express / implied terms of an employee’s employment. In the instance of a possible breach by the employer, it is incumbent on the employer to address an employee’s grievances, so as to not negate the defence of delay which would otherwise have been available should the employee have failed to act immediately.