Case Commentary Contracts Dismissal for Cause Employment Law Singapore

[Employment Law] An Obligation To Conduct “Due Inquiry” Prior To Termination For Cause?

The Singapore High Court opines on what an employer's duty is to conduct "due inquiry" prior to exercising its right of summary termination.

Case Commentary: Long Kim Wing v LTX-Credence Singapore Pte Ltd [2017] SGHC 151

In the High Court decision of Long Kim Wing v LTX-Credence Singapore Pte Ltd [2017] SGHC 151  (accessible on Singapore Law Watch here) – released 30 June 2017 – Justice Woo Bih Lih examined the employer’s obligation to carry out “due inquiry” prior to terminating an employee for cause.

In the present case, the employee was not governed by the Employment Act (Cap. 91) (the “Act“). Nonetheless, the employee’s general terms of service provided:-

The Company may after due inquiry dismiss without notice an employee on the grounds of misconduct inconsistent with the fulfilment of the express or implied conditions of his/her service.

[emphasis added]

The facts themselves are not that relevant, but Justice Woo’s observations on what constitutes “due inquiry” prior to exercising the right of termination without notice may be relevant in another context.

This is because the phrase “due inquiry” is also appears in Section 14(1) of the Act, which provides:-

An employer may after due inquiry dismiss without notice an employee employed by him on the grounds of misconduct inconsistent with the fulfilment of the express or implied conditions of his service except that instead of dismissing an employee an employer may —

 (a) instantly down-grade the employee; or

(b) instantly suspend him from work without payment of salary for a period not exceeding one week.

[emphasis added]

As such, the Judge’s comments, reproduced below, may apply to employees who are dismissed pursuant to Section 14(1) of the Act. The salient portions of the judgment are reproduced below:-

161 It seems to me that the phrase “due inquiry” means something more than just the making of inquiries and the conduct of an investigation. Otherwise the word “inquiry” alone would suffice. The phrase suggests some sort of process in which the employee concerned is informed about the allegation(s) and the evidence against him so that he has an opportunity to defend himself by presenting his position, with or without other evidence. While the website of the MOM does not have the force of law, its guide that the employee concerned should have the opportunity to present his case is a useful one. That accords with notions of justice and fairness especially since serious consequences may follow. Furthermore, as already mentioned, the Defendant did not dispute that the Plaintiff should have an opportunity to present his case.

 162 However, in order for an employee to be given an opportunity to present his case effectively, he must first be informed clearly what the case against him is. As mentioned above, this includes the allegation(s) and the evidence against him. While “due inquiry” does not mandate any formal procedure to be undertaken, the more the informality the greater the danger that “due inquiry” was not undertaken. Accordingly, where no formal process was undertaken, the court should be more careful to ensure that the employee’s right is protected.

Consequently, the decision in Long Kim Wing v LTX-Credence Singapore Pte Ltd [2017] SGHC 151 may be particularly relevant where the Act does apply as employers exercising their right of summary termination (or employees who have been summarily terminated) would have to carry out “due inquiry” prior to exercising their statutory right of termination.

In many ways, the Judge’s quote captures the principles of natural justice, in particular the rule of “audi alteram partem“, Latin for the “right to a fair hearing”.

Consequently, employers whose employees are governed by the Act (or whose employment agreements provide that the employer conducts due inquiry – or similar language to that effect – prior to the exercise of the right of summary termination) may wish to put into place a formal framework for allegations to be presented, responses to be considered and decisions to be made in a fair and transparent manner.

31 July 2017

 

*The contents of this article represent the views of the author alone from a Singapore law perspective and are subject to copyright protection under the laws of the Republic of Singapore (as may from time to time be amended). No part of this article may be reproduced, licensed, sold, published, transmitted, modified, adapted, publicly displayed and/or broadcast (including storage in any medium by electronic means whether or not transiently for any purpose save as permitted herein) without the prior written permission of the author.

Please note that whilst the information in this article is correct to the best of the author’s knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice for and/or in respect of any particular course of action as such information may not suit your specific business, operational and/or commercial requirements. You are therefore urged to seek legal advice for your specific situation. All the author’s rights are expressly reserved and nothing herein shall be construed as a waiver thereof.

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