Appeals Court denies future earnings claim

In a landmark decision of Telekom Malaysia Bhd v Ramli Akim, the Court of Appeal re-instated some sense into the manner in which Industrial Courts would award compensation for dismissed employees.

Ramli Akim was dismissed by Telekom Malaysia Bhd, and thereafter ventured into business. However, he failed in his venture. In the Industrial Court, he sought not only backwages but also for the loss of future earnings due to his failed business venture.

The Court of Appeal held:

(1) Although the Industrial Court has the discretion to determine the quantum of backwages, it should do so in accordance with the principles of justice and fairness, which should ordinarily be limited to 24 months.

(2) Delay in the Industrial Court process, where it has not been caused by the employer, should not be held against the employer in any award for backwages.

(3) The employee's failed venture into business after his dismissal, and the unlikelihood for the employee to be employed in a similar position, were irrelevant considerations not to be taken into account by the Industrial Court.

(4) Future loss of earnings is not an established or recognised head for damages in the Industrial Court.
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