When a PIP looks fair but is not, a court may call it out
SAP Asia breached its duty of trust to a terminated employee, a Singapore court ruled, putting HR processes and Business Partners on notice.
On January 21, 2026, Singapore's High Court delivered a judgment that settles a long-debated employment law question, and the answer directly affects how HR teams manage terminations. The case, Prashant Mudgal v SAP Asia Pte Ltd, unfolded like a familiar HR scenario: cross-functional tensions, hostile emails, a Performance Improvement Plan, and a termination.
Prashant Mudgal joined SAP Asia in August 2015 as a Solution Sales Engagement Manager Expert, rising to Head of Services Sales for the Ariba line of business in the Asia Pacific and Japan region. His working relationship with the head of the services delivery team fell apart across 2018, playing out through a series of internal emails that management considered aggressive and unprofessional. After refusing to write a formal apology to a colleague as directed by his manager, he was placed on a 45-day Performance Improvement Plan in March 2019. The PIP closed in May 2019. His employment was terminated by notice on November 21, 2019.
Mudgal sued for close to S$5 million, claiming conspiracy and breach of implied terms in his employment agreement. The conspiracy claims were dismissed. But on the key question of whether an employer owes employees a duty of mutual trust and confidence, Justice Dedar Singh Gill ruled in Mudgal's favour. SAP Asia had breached it.
This duty had long occupied uncertain legal ground in Singapore. The judgment noted that the implied term had previously been described as a "Trojan horse" because of its supposed potential to retroactively import a wide range of obligations into employment contracts. The ruling confirmed it exists, it is enforceable, and it lives inside every employment contract in Singapore, whether the parties wrote it in or not.
How the court got there is what HR professionals need to read carefully. Among the evidence examined was an internal email sent by the claimant's line manager to the company's HR Business Partner on November 20, 2018, months before the formal PIP was initiated. It read: "we are moving to full alignment on removing [the claimant]."
The court found the PIP that followed was not the genuine developmental process it appeared to be. That finding — a predetermined outcome dressed up as performance management — was enough to establish the breach. The HR Business Partner's role throughout, including her written communications, recommendations and involvement in the termination planning, was examined in open court.
Despite finding the breach, Justice Gill awarded Mudgal just S$1,000 in nominal damages. His claims for loss of earnings and psychiatric injury were rejected. The employer walked away without a significant financial penalty. But the legal standard it failed to meet now applies to every employer in Singapore.
Internal communications between managers and HR Business Partners are discoverable in litigation. A PIP can be examined for the intent behind it, not just its contents. The conduct of HR professionals throughout a termination, not simply the contractual mechanics, is now part of the record courts will scrutinise.
