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24
Dec

 

Section 20 of Industrial Relation Act against Foreign Employer. Yay or Nay??

As a Malaysian citizen, being able to work with an overseas Company could be an achievement. However, what happened if you were dismissed by the Company? Whether the Industrial Court has the jurisdiction over Overseas Company or Foreign Employer? 

Generally, the Industrial Court has no extra-territorial jurisdiction. It means the Industrial Court only have the jurisdiction to hear matters that within its jurisdiction i.e. Malaysia. The Industrial Relation Act 1967 does not confer the Industrial Court extraterritorial jurisdiction. Thus, any employee employed by foreign employer or foreign company is not within the scope of Industrial Court Malaysia.

Is there really no other way? The Industrial Court in the case of Rajkumar Vijayan V. Suntech Engineering Korea [2024] ILRU 1200, held that:

“There is no automatic exclusion of jurisdiction only because the Company is a foreign entity. The determination of the extra-territorial jurisdiction point depends on the facts of each case and there is no hard and fast rule that governs all cases.”

Based on the above case, there is a ray of hope. The Company in this case was a Korean Company and the Industrial Court held that the Company was within the jurisdiction of the Industrial Court. Why?

The Industrial Court took into consideration the following the salient facts in arriving to the its decision: -

  1. The Company was incorporated in South Korea and had a contract with Boustead Naval Shipyard Sdn. Bhd. to carry out work for the Royal Malaysian Navy at Lumut Perak. 

  2. The Company also set up a Malaysian registered company known as Sejin Technical Industrial Sdn. Bhd to act as the representative of the Company in Malaysia. 

  3. The Company’s office is at Seri Manjung and later at the Lumut Shipyard situated at Lumut, Perak.

  4. The Contract of employment was sign in Malaysia. 

  5. The Claimant performed his duty in Malaysia. 

  6. At the time of his dismissal, the Company was present in Malaysia. 

 

What are the important key points here?

  • The Company had a contract to carry out work in Malaysia.

  • The Company established a Malaysian registered Company as its representative.

  • The Company’s office was at Seri Manjung & Lumut, Perak.

  • The Contract of employment was signed & the Claimant performed his duty in Malaysia.

  • Therefore, undoubtedly the Company has a presence in Malaysia.

Through all the facts and points above, what can be concluded is, if the Company has a “presence” in Malaysia, it is well within the jurisdiction of the Industrial Court. The question remains yay or nay? The answer depends on the facts of each case. If the Company has a presence in Malaysia, it is within the jurisdiction of the Industrial Court. Thus, a complaint can be lodged under Section 20 of the Industrial Relation Act 1967.

 

By: Mujajir Wazinie Morchseinie 

 

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