Worker argues employer coerced departure through suspension threats and misconduct warnings
The Industrial Court of Malaysia recently dealt with an employment dispute involving allegations of forced resignation following workplace harassment complaints.
A worker claimed his employer coerced him into resigning after he was suspended pending investigation into bullying allegations made by subordinates.
The worker argued that management pressured him to leave during a meeting where it became clear they favoured retaining the complainant over him.
He maintained that a subsequent email from HR warning about the consequences of gross misconduct termination constituted a threat designed to force his resignation.
However, the employer presented a different version of events, arguing the worker voluntarily negotiated his departure terms and even enquired about his payment entitlements before submitting his resignation.
Workplace harassment allegations emerge
The worker started employment as finance manager in April 2021 with a monthly salary of RM18,500, managing a team of accountants within the employer's shared services centre.
His duties included providing guidance to direct reports and performing annual reviews of subordinates.
Problems began around the worker's handling of probation reviews. Instead of conducting assessments himself, the worker repeatedly asked his probationary subordinates to complete their own review forms and schedule meetings with him to review and approve them. One subordinate complained to the finance director on 11 March 2022 about this practice.
Despite being told to complete the reviews himself, the worker continued his previous approach.
Two days later on 13 March 2022, he again instructed another subordinate, a Korean expatriate, to self-assess her probation review form. She complained to the finance director and HR on 14 March 2022.
Workplace harassment tensions escalate
On 17 March 2022, the worker met with the Korean expatriate about her probation review and again asked her to self-assess.
According to the worker's account, he found her uncooperative, leading to a misunderstanding. She left the office and did not report to work for the next two days.
When the finance director returned from leave, he arranged a meeting to mediate the matter. However, the Korean expatriate expressed fear of the worker and requested to work from home, which the finance director agreed to accommodate.
The employer decided to formally launch an investigation against the worker for workplace bullying and harassment under the Malaysia Employee Guide.
Before communicating the misconduct allegations, the finance director met with the worker on 29 March 2022 to discuss resolving the ongoing issues.
Employer’s investigation into worker’s alleged misconduct
During the 29 March meeting, the finance director discussed the complaints. The worker offered a "gentlemen's agreement" to resign if given three months to find another job and enquired about his entitlement to notice period payment.
The meeting concluded with the worker saying he wanted to "clear his name." Following this discussion, HR prepared a suspension letter dated 29 March 2022 to suspend the worker pending further investigations.
The following day, the HR manager sent the suspension letter via email along with a clarification email about entitlements.
This email included the statement central to the worker's case: "I also wanted to make you aware if we do terminate due to gross misconduct this will be an instant termination and you will not receive your 3 months' notice period payment and will only receive your sick leave and holiday balance."
Did HR force the employee to resign?
The worker viewed the HR manager's email as coercive and chose to resign. On 31 March 2022, he sent his resignation email stating: "I would like to tender my resignation from my current role... I appreciate the opportunity that was given to me, and the learnings I have made during my stay."
Crucially, the worker had telephoned the finance director on the morning of 31 March 2022, before sending his resignation, to enquire whether he would receive three months' salary in lieu of notice if he resigned. Only after receiving confirmation did he submit his resignation.
Twelve days later, on 12 April 2022, the worker sent another email making his first allegation of forced resignation. The court found this delay significant, noting: "If there was any force or coercion exerted by the [employer]... then the [worker] ought to have responded immediately."
Workplace harassment legal principles applied
The Industrial Court in this case (Case No. 22(20)/4-13/23) applied established legal principles for forced resignation cases. The court noted: "In order to prove a claim of forced resignation, it was incumbent upon the [worker] and the burden is on him to adduce evidence to show that he was placed in a position where he was forced to resign."
The court emphasised the situation was still at investigation stage when the worker resigned, stating: "The most prudent thing for the [worker] to have done was to challenge the allegations of workplace harassment even at the investigation stage before even going through the disciplinary process."
The court also noted that advice to resign as an alternative to facing potential dismissal "by itself does not constitute a threat."
The court found that where willingness to resign is brought about by negotiated terms satisfactory to the employee, rather than threats, no forced resignation occurs.
Is it forced resignation?
The Industrial Court concluded the worker's resignation was voluntary, stating: "it is the finding of this Court that the [worker's] resignation was made voluntarily and that there is no evidence of any threat, duress, force or even of any mala fide intention on the part of the [employer]."
The court emphasised the worker personally drafted his appreciative resignation email, proactively enquired about payment terms, and only resigned after confirming he would receive three months' salary.
The court concluded: "[The worker] cannot have the best of both worlds; negotiating and accepting the terms of a separation and then at the same time claiming that he had been constructively dismissed."
"The overwhelming evidence before the Court shows that he had voluntarily resigned in order to avoid disciplinary action being taken against him pertaining to the allegations of workplace harassment," the court added.
The worker's case was dismissed entirely.
