Case Update: Factors considered by the Industrial Court in determining the identity of the employer in a multi-jurisdictional employment relationship

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In this Case Update series, I share summaries of recent Malaysian court decisions to explore the current approach taken by the courts when deciding on employment-related issues. You can find all the posts in the series by clicking here, including case updates on other legal areas by TheMalaysianLawyer co-founder Lee Shih.

In this era of the multinational corporation, it is common for employees to be carrying out most (or even all) of their work in one jurisdiction, while technically being employed by an employer entity in another jurisdiction. This could either be because the employer does not have a local entity, or because the employee was initially employed by an entity in one jurisdiction but was subsequently assigned to a post in another jurisdiction, or for a host of other commercial reasons.

We therefore see increasingly complicated employment relationships — the core employment contract being supplemented by assignments, secondments, or some other similar arrangements both formal or otherwise — which in time can lead to confusion over who the actual employer entity is, and more importantly, which jurisdiction the employer is in. Some of these arrangements can get even more convoluted with the introduction of other structures such as third party employment or payroll service providers or local host entities.

Identifying the correct employer entity becomes important when an employee seeks recourse at the Industrial Court. It is not as straightforward as determining which entity pays the employee’s salary, or owns the office the employee spends most of his time in. Once it is determined that the employer entity is in another jurisdiction, can the Industrial Court hear the matter?

The relevant factors were recently considered by the Industrial Court in two cases — Lars Kruse Thomsen v. Hot-Can Sdn Bhd (Award No. 1629 of 2017), and John Brian Chesson v. Baker Hughes (Malaysia) Sdn Bhd (Award No. 119 of 2018).

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MACC Amendment Bill: Introduces Corporate Liability for Corruption Offences

The MACC Amendment Bill 2018 has been presented in Parliament on 26 March 2018. If the Bill is passed, these provisions will come into force once the amendment Act is gazetted. [edit: Since writing this article, it has also been reproduced in theSun newspaper on 30 March 2018.]

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The main thrust of this Bill is to introduce a new far-reaching corporate liability provision into the MACC Act. There are key changes and steps that companies, and its directors and officers have to be aware of.

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Compendium of Companies Act 2016 Cases: Part 1

With the Companies Act 2016 in force for more than a year, I thought it is useful to set out a compendium of cases and transactions that have applied the Companies Act 2016 provisions.

As a summary, in terms of the reported cases, many of the cases relate to winding up based on the inability of the company to pay debts. This is under section 466 of the Companies Act 2016 (the old section 218 of the Companies Act 1965). Other cases also relate to other areas of winding up or shareholder disputes. I also highlight below examples of capital reduction and schemes of arrangement. Continue reading

TML and Legal Logic Asia Talk: Post Implementation Challenges of the Companies Act 2016

On 20 April 2018, I will be speaking at the Legal Logic Asia talk on The Companies Act 2016: Post Implementation Challenges, New Corporate Rescue Mechanism Rules 2018 & Malaysian Code of Corporate Governance.

My co-speaker, Kenneth Foo, and I designed the course contents and the programme should be very enriching for the audience. We will using practical examples and real-life case studies to flesh out the issues we have come across. You can access the registration form here and with an early bird rate of RM800 if you sign up by 13 April 2018.

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TheMalaysianLawyer.com: 1,000,000 views (and counting…)

TML one million

On 12 October 2015, following up on an idea that came up during a chat between lawyers (and soon-to-be TML co-founders) Lee Shih and Marcus van Geyzel over a midweek duck noodle lunch in Midvalley a few days earlier, the first post was published on TheMalaysianLawyer.com.

What started off as a fun side project with the intention of featuring practical, high-quality, and relevant legal content, has taken on a life of its own. TML has opened many doors for us as its co-founders, and earlier this week we hit another milestone — 1,000,000 views.

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Case Update: What can an employer do upon discovering that an employee lied in a job application?

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In this Case Update series, I share summaries of recent Malaysian court decisions to explore the current approach taken by the courts when deciding on employment-related issues. You can find all the posts in the series by clicking here, including case updates on other legal areas by TheMalaysianLawyer co-founder Lee Shih.

The hiring process can often be tricky for employers. In the Malaysian job market, it is common for employers to receive hundreds of applications for certain vacancies. Employers then have to comb through these applications, shortlist candidates to be interviewed, and make a hiring decision based on fairly limited information.

To reduce the time spent on this process, many employers do not conduct thorough background checks on job applicants. The experience and employment history stated in the applications are often assumed to be accurate, with some allowance given for an expected reasonable degree of exaggeration.

What is the recourse for an employer who, soon after hiring an individual, realises that the employee had lied in his job application? Does this false information constitute just cause for an employment termination, or will the dismissal enable the employee to bring a successful unfair dismissal claim?

The Industrial Court considered these issues in two recent awards — Khoo Kim Loang v. Shock Media Studio Sdn Bhd (Award No. 51 of 2018) on 4 January 2018, and Khoo Kim Loang v. Kim Siah Electric Co Sdn Bhd (Award No. 137 of 2018) on 12 January 2018 — interestingly both involving the same Employee.

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Companies Act 2016: Corporate Rescue Mechanism is in force on 1 March 2018

By the gazetting of the notice P.U. (B) 106/2018 dated 27 February 2018, the corporate rescue mechanism under Division 8 Part III of the Companies Act 2016 has come into force on 1 March 2018. The corporate rescue mechanism allows for financially distressed companies to consider two options: (1) corporate voluntary arrangement and (2) judicial management.

I set out only some brief key features of these two mechanisms. Along with the coming into force of the corporate rescue mechanism provisions, the new Companies (Corporate Rescue Mechanism) Rules 2018 have also come into force on 1 March 2018. Continue reading