Immediate dismissal, also known as termination without notice, is one of the most misunderstood areas in employment law in Malaysia. Many employers assume they can remove an employee on the spot for “bad attitude” or poor performance. Unfortunately, doing so without following due process can lead to wrongful dismissal claims, putting your business at legal and financial risk.
As employment and industrial relations lawyers, we guide both employers and HR professionals on how to handle workplace discipline lawfully and effectively. Here’s what you need to know.
What Does the Law Say?
Under Section 14 of the Employment Act 1955, an employer may terminate an employee without notice in cases of misconduct, but only after “due inquiry”. The Industrial Relations Act 1967 further protects all employees (even those not covered by the Employment Act 1955) from being dismissed without just cause or excuse.
When is Immediate Termination Allowed?
You may terminate an employee immediately if there is serious misconduct, such as: –
- Theft or fraud
- Assault at the workplace
- Sexual harassment
- Habitual absenteeism or insubordination
- Breach of company confidentiality
Even then, an internal inquiry must be held. This is a basic requirement of natural justice – the employee must be informed of the allegation and given a chance to respond before any decision is made.
What If You Skip the Inquiry?
If you fire an employee without: –
- Investigating the complaint,
- Giving the employee a chance to explain, or
- Having clear proof of misconduct,
You risk facing an unfair dismissal claim at the Industrial Court. The court may order: –
- Reinstatement;
- Compensation in lieu of reinstatement; or
- Backwages
This applies even to probationers and long-serving staff alike.
Best Practices for Employers
To protect your business, we recommend: –
- Implementing a written disciplinary policy
- Conducting a domestic inquiry before dismissal
- Keeping detailed records of all incidents, warnings, and communication
- Consulting an industrial relations lawyer before proceeding with termination
Many companies today opt for a legal retainer so they have fast access to a corporate legal firm that can assist with disciplinary matters and termination procedures.
Do Probationers Have Protection?
Yes. Contrary to popular belief, probationers are entitled to the same procedural fairness. While employers may terminate them for poor performance or attitude, it must still be done fairly and with sufficient justification.
Need Legal Support?
At our law firm, we regularly assist clients in:
- Drafting employment contracts and HR policies
- Handling domestic inquiries and investigations
- Advising on legal grounds for termination
- Defending or pursuing Industrial Court claims
Whether you’re an SME or growing enterprise, we offer retainer packages that give your HR team the legal backing they need to make compliant decisions.
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