When does an initial positive drug screening justify dismissal, even if subsequent laboratory pathology tests show negative results for substances?
A head of HR for a property holdings company challenged his dismissal after being arrested during a police drug operation at his residence.
The worker argued that laboratory tests showed negative results for drugs and that the domestic inquiry was procedurally flawed.
The company maintained that the worker's initial positive drug screening, drug purchase attempt, dishonesty to superiors, and damage to corporate reputation constituted serious misconduct.
The Malaysian court examined whether the company proved misconduct charges and whether dismissal was justified given the worker's senior position.
Employment background and arrest circumstances
The worker commenced employment in September 2010 with a subsidiary company within a larger corporate group.
He was appointed as head of HR management in January 2015. His last drawn position was head of division for HR management.
The worker was responsible for strategic planning and human resource functions across multiple companies within the group.
The worker was arrested on 16 April 2020 at his rented apartment. Police had stopped a delivery driver at a roadblock earlier that day. Officers discovered substances suspected to be methamphetamine and ecstasy in the driver's vehicle. The driver's mobile application showed a delivery address registered to the worker's apartment unit.
Police raided the worker's residence that afternoon and arrested him along with another individual present.
The worker was remanded for four days from 17 April until 20 April 2020. He was subsequently released on police bail. During the initial urine screening upon arrest, the worker tested positive for methamphetamine.
Suspension period and investigation process
The company issued a suspension notice on 12 May 2020. The letter stated that the suspension would remain effective until the worker received complete urine test results from the police. The worker received full salary throughout the suspension period. The company appointed a new HR manager on 3 June 2020 during the worker's suspension.
The company received information in July 2020 that laboratory tests from the pathology department showed negative results.
The company nevertheless proceeded with internal investigations. Officers interviewed the worker and reviewed evidence gathered during police investigations. The company decided to afford the worker the full opportunity to explain the allegations.
A show-cause letter was issued on 27 July 2020. The letter contained one charge relating to the positive initial screening results.
The worker responded on 7 August 2020, asserting that charges were unfounded. He argued that laboratory pathology tests showed negative results. The worker contended he did not violate any code of conduct or employment terms.
Domestic inquiry charges and proceedings
The company issued a domestic inquiry notice on 3 December 2020. The notice contained four charges, including three additional charges not stated in the show cause letter.
The first charge related to the initial positive screening for methamphetamine. The second charge alleged the worker purchased two packets of methamphetamine for delivery to his residence.
The third charge alleged the worker lied to his superior about the reasons for taking leave. The worker had informed his superior that he needed emergency leave for family matters.
In reality, he had been arrested and remanded by the police. The fourth charge alleged the worker's arrest and remand tarnished the company's reputation and image.
The domestic inquiry was scheduled for 10 December 2020. The worker sent an email on 9 December requesting an extension to gather supporting documents.
He sent a follow-up message stating he had not received any reply. The company responded on 10 December at 9.42 am, rejecting the extension request. However, the worker claimed he did not receive this email.
The company proceeded with the domestic inquiry in the worker's absence. The inquiry panel unanimously found the worker guilty of all four charges. The company issued a dismissal letter on 10 February 2021. The worker submitted a written appeal on 10 March 2021. The company rejected the appeal on 28 April 2021.
Worker's defence and procedural objections
The worker argued that laboratory pathology tests showed negative results for drugs. He contended he never appeared in any court or was charged with any criminal offence.
The worker maintained he had no knowledge of the package contents. He claimed he was merely assisting an acquaintance with payment for an item.
The worker contended the domestic inquiry was fundamentally flawed. He argued charges were vague and failed to specify particulars such as dates or amounts.
The worker stated he never received minutes of the domestic inquiry despite written requests. He claimed key documents were introduced without prior disclosure to him.
The worker submitted that verification of the urine screening was not properly established. He argued the company failed to produce chemical analysis reports or photographs of seized substances.
The worker maintained that as an employee, he was entitled to take emergency leave without detailed explanations. He contended that emergency leave was a right granted under employment legislation and company policies.
Court's evaluation of the first charge evidence
The court examined whether the first charge related to initial screening or subsequent laboratory results. The company contended the charge pertained to initial screening conducted upon arrest on 16 April 2020.
Police reports confirmed the initial screening returned positive results. The worker's suspension letter stated that suspension would continue pending final urine test results.
The court found that neither the company nor the police witnesses denied that laboratory reports showed negative results. Police witnesses clearly testified that the pathology department confirmed negative results for drugs.
However, the court noted that the first charge specifically referenced initial screening conducted upon arrest. The charge did not concern laboratory results released subsequently in July 2020.
The court stated that positive results from initial screening constituted serious misconduct. Whether the pathology department subsequently returned negative results was irrelevant to the first charge.
The court noted the worker's own voluntary statement to investigators. The worker admitted he had taken methamphetamine four days before his arrest. He also admitted to consuming drugs since his university days in the United States.
Court's findings on drug purchase charge
The court examined evidence relating to the second charge concerning drug purchases. Police reports stated that substances suspected to be methamphetamine and ecstasy were found in a delivery driver's vehicle.
The delivery application showed the worker's apartment address as the destination. Officers raided the worker's residence and arrested him along with another individual.
The worker argued the company failed to produce chemical analysis reports or photographs of seized drugs. He contended that the existence of methamphetamine was not proven.
The court noted that police officers testified that the chemistry department confirmed the substances were methamphetamine and related drugs. However, officers stated they could not share laboratory results due to confidentiality and official secrets legislation.
The worker admitted during internal investigations that he purchased drugs online. He stated he arranged payment of six hundred ringgit via online banking.
The worker confirmed he was working from home during the movement control order. He acknowledged he was at his rented apartment when police conducted the raid. The worker admitted in his voluntary statement that he knew the package contained drugs.
Court's assessment of dishonesty charge
According to the case's records (no. 22/4-2840/21), the court examined the third charge relating to dishonesty toward the worker's superior.
The worker was scheduled to attend a meeting on 16 April 2020 at 4.30 pm. He sent a message at 3.18 pm informing his superior he needed emergency leave for family matters. At that point in time, the worker was already under arrest by the police.
The worker sent another message on 18 April 2020 whilst still in remand. He stated he needed half-day or full-day leave on 20 April 2020 for family matters.
The worker again failed to inform his superior that he was being remanded by the police. He instead lied that he had to attend to family matters. The superior replied, noting the leave request.
The court stated the issue was not whether detailed explanations were required for emergency leave. The very reason given by the worker to his superior was untrue. He was not attending to any family emergency matters.
He had been arrested and was under remand by the police. The worker deliberately concealed the fact of his arrest and remand from management.
Court's evaluation of reputational damage charge
The court examined the fourth charge relating to damage to the company's reputation. The worker held the position of head of HR management for multiple companies within the group.
The court stated that holding such a high position carried greater responsibilities regarding personal conduct. The worker had been involved in drug abuse since university days, according to his own admission.
The worker represented himself as a company employee to the police when apprehended. Information about the worker's arrest reached the corporate group's security department and HR department.
The court stated the company's image was tarnished and brought into disrepute due to the worker's drug-related issues. Substance abuse created negative perceptions about the company and its staff.
The worker contended the charge should fail because he was not charged in criminal court. The court stated the issue was not whether the worker was criminally charged or convicted.
The issue was whether his drug-related issues and substance abuse constituted serious misconduct. The worker brought the company's image and reputation into disrepute. He created negative perceptions about the conduct and character of company staff.
Determination on procedural fairness
The worker contended the domestic inquiry was flawed and did not adhere to principles of fairness. The court noted the worker himself did not attend the domestic inquiry despite being notified. The worker applied for an extension of time to prepare.
This was not granted by the company. Even if the worker allegedly did not receive the rejection email, he could not simply ignore the scheduled hearing.
The worker's counsel submitted that the court cannot set aside a flawed domestic inquiry and conduct a fresh hearing. The court stated this submission was wholly misconceived and not apprised of the prevailing law. Absence of a domestic inquiry or procedural breach of natural justice is not fatal. Any procedural breach could be cured at the industrial court hearing.
The court cited federal court authority establishing that employers may establish grounds for dismissal afresh before the industrial court. The court stated that where an inquiry is found defective, the employer is at liberty to establish the basis for termination.
It said that the very purpose of an industrial court inquiry is to give both parties the opportunity to be heard. If there was procedural breach initially, it could be cured at the rehearing.
Final determination and dismissal upheld
The court found the company succeeded in proving all four charges on the balance of probabilities. The misconduct in all four charges constituted serious acts of misconduct.
As head of HR management, the worker had added responsibilities and a fiduciary duty. He was required to always act in the company's best interests. The punishment of dismissal was proportionate to the misconduct complained of.
The worker's conduct was against the company's best interest and faithful discharge of duty. No amount of long years of service could repair the damage to shattered trust and confidence.
The court stated that long years of unblemished service do not immunise a worker from dismissal. The court found the company's action in terminating the worker's services was done with just cause and excuse.
The worker's case was dismissed accordingly. The court was satisfied that the dismissal was justified. The worker failed to prove that the company acted without just cause or excuse.
The court found that all elements of misconduct were established through the worker's own admissions and supporting evidence. The company was entitled to terminate employment for such serious violations.
