The Industrial Court has ruled that the retrenchment of a former editor was without just cause or excuse after finding shortcomings in the company’s handling of the exercise.
On May 13, the court found that a former news editor had been arbitrarily identified as redundant during the company’s restructuring exercise in 2020.
Counsel for the claimant, V.K. Raj, argued that the retrenchment lacked documentary support and proper justification.
The court noted that the company did not produce written reports, departmental review papers, meeting minutes or documented criteria to support the retrenchment decision.
During cross-examination, the company’s senior news editor, said discussions on the claimant’s redundancy took place informally “in the corridor” and involved “off-the-cuff discussions” without HR involvement.
The court said the lack of documentation weakened the company’s claim that the retrenchment exercise had been carried out bona fide.
It also found that the claimant’s job functions continued after his retrenchment and were carried out by eight remaining editors.
The court further found that the company had not justified departing from the Last-In-First-Out (LIFO) principle, noting that the claimant had served the company for nearly 28 years while junior editors were retained.
The company argued that the retrenchment exercise was necessary because of declining revenue, falling demand for print products and the impact of the Covid-19 pandemic.
However, during cross-examination, the company’s witness acknowledged there was no documentary evidence before the court showing a decline in market share.
The proceedings also referred to company financial statements stating that the group posted a net profit of RM26.9 million for the third quarter ended Sept 30, 2020, and had cash reserves of more than RM300 million with no borrowings.
“Companies cannot carry out retrenchments without clear evidence that the exercise was properly planned and fairly conducted,” Raj said.
The company had said the exercise affected employees across several business units.
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