We often hear the saying that “people leave managers, not organisations.” But what about the manager’s perspective? Their story is not widely told, largely because our laws are primarily designed to protect the employees.
From an employer’s point of view, hiring someone is a long-term commitment — almost like entering a relationship “for better or for worse.” While an employee can resign when things become unbearable, an employer trying to end a toxic and non-performing relationship may find the process complicated, sensitive, and legally risky.
Like any relationship, the manager–employee dynamic is shaped by communication styles, workload pressures, personality differences, and even personal stress. These pressures naturally create conflict. With mutual respect and emotional intelligence, most issues can be resolved through honest adult conversations, allowing the relationship to stay productive — or at least cordial.
But when emotions take control and one party decides, “I will make life miserable for you because I think you are making it miserable for me,” the relationship is bound to go downhill. That is when accusations of “unfair dismissal” or “constructive dismissal” begin to appear.
And regardless of whether the employee resigned or the employer followed the proper dismissal process, the employee can still file a claim.
This is where the employer already starts on the losing end.
To initiate a claim, an ex-employee submits a written representation to the Director General of Industrial Relations (DGIR). A Conciliation Officer is then assigned to help both parties reach a compromise.
For unfair dismissal claims, prior to the 2020 Amendment, if conciliation failed, the Minister of Human Resources acted as a filter — only cases with merit were referred to the Industrial Court. This gatekeeping function protected the court system from being burdened with frivolous or vexatious claims.
It is worth noting that placing this gatekeeping function in the hands of the Minister, whose role is intended for high-level policy and national strategy, responsible for making operational filtering decisions on individual disputes.
However, under the amended Section 20 of the Industrial Relations Act 1967, that filtering role no longer exists. If conciliation fails, every claim — regardless of merit — automatically proceeds to the Industrial Court.
This can open the door for misuse. If the employer is the abusive one, the law rightly protects the employee. But if the employee is the one who created the toxicity and performance issue, the employer now faces a long, expensive, and emotionally draining battle of preparing documentation, attending multiple hearings, and mobilising witnesses. These require substantial time and resources.
Employees too may incur legal costs if a case proceeds to the Industrial Court. For those with limited financial resources, this can pose a significant burden, and they may explore whatever legitimate options are available to manage these expenses.
However, the reality remains that the employer, as the party carrying the heavier burden of proof, typically bears far higher and more complex costs — both financially and administratively — throughout the entire process.
For employers with deep pockets, absorbing the cost of a prolonged Industrial Court process is manageable. But for organisations with tighter cashflow, the calculation becomes very different.
Instead of defending the case based purely on merit, they often have to consider the total financial impact of proceeding — legal fees, staff time, and operational disruption. This can lead to settlements made not because the employer is at fault, but simply to minimise cash outflow and avoid further strain on resources.
Up to Q3 2025, employers have already lost RM37.8 million in unlawful dismissal awards. This figure excludes settlements reached during conciliation or out of court. For context, the amounts awarded in 2023 and 2024 were RM39 million and RM48 million respectively (https://www.e2consulting.com.my/e2-perspectives-insights/unlawful-dismissal-industrial-court-trends-q3-2025).
With such risks, many employers become hesitant to discipline or dismiss non-performing employees — even after following structured performance management processes. This fear allows many “deadwood” employees to remain in organisations, dragging down productivity and affecting the morale of employees who are actually performing.
It may be time for the Ministry of Human Resources to revisit these unintended effects.
Genuine employee grievances absolutely deserve protection. No one should be unfairly dismissed or treated unjustly at work.
But employers also need safeguards to ensure that the dispute process is not misused tactically or emotionally. Reintroducing a filtering mechanism — or introducing an equivalent check — would help ensure that only cases with legitimate merit proceed to the Industrial Court.
Another important area is strengthening the social-acuity competencies of Conciliation Officers and the DGIR, especially in accurately assessing interpersonal dynamics and behavioural patterns during conciliation.
Workplace conflict is rarely one-sided. A discerning officer must be able to recognise emotional manipulation, retaliatory motives, or tactical complaints just as effectively as they identify genuine victimisation or unfair treatment.
Strengthening judgement at this early stage would ensure that conciliation remains balanced, fair, and grounded in sound assessment — protecting employees with legitimate concerns while ensuring employers are not unfairly disadvantaged for managing their workforce responsibly.
If left unchecked, the current structure of Section 20 may unintentionally create an environment where the dispute process itself becomes a pressure tool. While this is not “blackmail” in the legal sense, the practical effect can resemble a situation where employers feel pressured to settle simply to avoid the time, cost, and stress of the process.
Addressing these unintended consequences would help restore a fairer, more balanced industrial relations system — one that supports both employee welfare and organisational productivity.
Coco Nut (anitadharam@yahoo.com) is a content creator under the Newswav Creator programme, where you get to express yourself, be a citizen journalist, and at the same time monetize your content & reach millions of users on Newswav. Log in to creator.newswav.com and become a Newswav Creator now!
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