Yew Huoi, How & Associates | Leading Malaysia Law Firm

UNFAIR DISMISSAL – MEDICAL LEAVE IS NOT MISCONDUCT: HIGH COURT UPHOLDS INDUSTRIAL COURT’S PROTECTION OF SICK EMPLOYEE

1. Summary and Facts:
Aerodarat Services Sdn Bhd v Lawerance Raj A/l Arrulsamy & Anor [2025] 11 MLJ 26 concerns on wrongful dismissal of Lawerance Raj as a Duty Manager (Passenger Services) since 2016. The claimant’s duty required extensive walking to perform his duty. Since January 2018, it was recorded that Lawerance Raj had took prolonged medical and illness leave due to a serious knee condition after undergone a total knee replacement surgery in July 2019. Due that, his absence rate ranged from 59% to 100% but supported with medical certification. Unsatisfied with that, the employer, Aerodarat Services Sdn. Bhd issued a show cause letter alleging that his prolonged absenteeism showed an intention not to come to work and unwillingness to perform contractual duties. The employee denied the allegation and responded where the employer was aware of his prolonged illness and stated he would return once medically fit. The employer dismissed him. The Industrial Court later held that the dismissal was without just cause and excuse which resulting the employer for judicial review.

2. Legal Issues:
• Whether the excessive medical leave alone proved misconduct showing intention not to work.
• Whether the Industrial Court erred in law in finding unfair dismissal.
• Whether the doctrine of frustration of contract applied.

3. Court’s Findings:
• The High Court dismissed the judicial review application and upheld the Industrial Court’s award.
• The excessive medical leave per se is not amounting to misconduct therefore, the employee has a clear intention for not return to work must be proven as failed to do by the employer.
• The employer failed to prove any intention not to return to work, as medical evidence showed the employee was recovering and intended to resume duties once fit.
• The doctrine of frustration of contract cannot be raised later if it was not stated in the dismissal letter.
• The court’s inquiry confined to the reasons relied upon by the employer at the time of dismissal by way of misconduct.
• The employer was aware of the claimant’s medical condition but failed to ascertain his return-to-work timeline or offer lighter duties despite having the resources to do so.

4. Practical Implications:
This judgment affirms the several principle of laws including:
• Prolonged medical leave alone does not justify dismissal unless there is clear intention of the employee for not return to work.
• The burden of proof lies on employers where they must actively prove misconduct and not rely on assumption drawn from absenteeism.
• Failure to assess medical prognosis or offer light duties risks unfair dismissal.

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