Jonathan Khaw, together with Kang Zhi Han, acted for the Applicant in an application for leave to appeal to the Federal Court under Section 96(a) of the Courts of Judicature Act 1964, before a panel comprising YA Dato’ Rhodzariah binti Bujang, YA Tan Sri Ahmad Terrirudin Mohd Salleh and YA Dato’ Mohd Nazlan bin Mohd Ghazali.
Our firm was instructed at the Court of Appeal stage, and the leave application proceeded against concurrent findings of the courts below.
The Federal Court ultimately refused our Client’s application for leave, and that decision is final and is fully respected.
This article instead focuses on our Client’s principal proposed Question of Law, which arose from a procedural issue concerning pleadings, contemporaneous EPF and SOCSO statements, and the Industrial Court’s treatment of that evidence.
The Applicant’s Principal Proposed Question of Law
Our Client’s principal proposed question was the following:-
“Whether the Industrial Court may, as a matter of law, rely on an “under-declaration” theory not pleaded by the employee to disregard statutory contribution records (including EPF contributions) in determining the contractual salary for the purposes of a constructive dismissal claim.”
The remaining parts explain why that question arose in this case by referring to the Claimant’s pleadings and the Industrial Court Award.
The Parties’ Pleaded Case
The starting point is the Claimant’s pleaded cases before the Industrial Court. Paragraph 18 of the Claimant’s Statement of Case is reproduced below:-
“18. The Claimant also subsequently discovered that the Company had failed to make the mandatory statutory contributions to the Claimant’s EPF and Socso accounts since October 2018.”
The Claimant’s case before the Industrial Court was, among others, that our Client had unilaterally reduced his salary, and subsequently stopped making EPF and SOCSO contributions. Paragraph 18 of the Statement of Case above dealt specifically with the latter complaint, namely that the Company had failed to make the mandatory EPF and SOCSO contributions from October 2018 onwards. It was never the Claimant’s pleaded case that our Client had under-declared his salary to the statutory authorities, under-declaration simply did not form part of either party’s pleaded case.
The question then became how the Industrial Court dealt with the contemporaneous EPF and SOCSO contribution records before the Court, for the period from January 2013 to September 2019.
The Industrial Court Award
The relevant portions of the Industrial Court Award are reproduced below:-
“[39] The Claimant contends that his monthly salary up to the time his late father passed away was between RM25,000.00 to RM30,000.00 and had referred to the cheques issued by the Company during the trial (at pp. 15 – 59 of CLB-1).
[41]…the amount of contribution to the Claimant’s EPF and SOCSO accounts did not commensurate with his purported salary of RM25,000.00 to RM30,000.00. As far as the EPF contributions are concerned, between January 2013 and September 2019 the employee’s monthly contributions were RM117.00 and the employer’s monthly contributions were RM156.00 (at pp. 123-185 of COB-1). Whereas the SOCSO contributions between 2010 until 2017 was RM25.90 and for 2018 was RM46.10 (at pp. 18-23 of COB-2).
[42] The Court however notes that the Company was unable to challenge the fact as well as the documentary evidence before the Court that the Claimant had indeed derived payments of between RM25,000.00 to RM30,000.00 as his monthly salary before his father passed away. And at all material times, COW-1 had been in charge of the accounts and in fact was the person who submitted the EPF and SOCSO contributions. Nothing turns upon the fact that the amount of EPF and SOCSO contributions are not commensurate with the alleged monthly salary of RM25,000.00 to RM30,000.00. The possibility of the Company having under declared to the statutory bodies in respect of the Claimant’s actual income could not be ruled out. What is even more glaring here is that the Company, instead of producing documentary evidence which would prove that the Claimant’s salary was actually RM1,200.00 per month (as alleged by the Company) from the day he joined the Company until the day he deemed himself to be constructively dismissed, now invites the Court to make conjectures and speculations as to what the Claimant’s salary could or should be.
[43] What puts paid to the Company’s allegation of the Claimant’s monthly salary being a mere RM1,200.00 is COW-1’s own testimony before the Court during cross- examination wherein she admitted that before the late Mr. Wong Kok Wan passed away, the Claimant’s salary was indeed between RM25,000.00 to RM30,000.00 per month.
[45]…..The evidential burden of proof is on the Company to show to this Court that the monthly payments of RM25,000 to RM30,000 were not salaries but was in fact to finance the late Mr. Wong Kok Wan’s family from the first marriage.
[48]…due to the non-existence of an employment letter which would and could have spelt out the Claimant’s salary with certainty, the Court will consider the Claimant’s salary, on average, to be RM27,500.00 per month..”
From the passages reproduced above, it can be seen that the Industrial Court considered a number of different pieces of evidence in determining the Claimant’s salary, which included, among others:-
- The Company’s cheques relied on by the Claimant in support of his alleged monthly salary of between RM25,000 and RM30,000;
- The contemporaneous EPF and SOCSO statements for the period from January 2013 to September 2019;
- The admission made by the Company’s own witness that, before the late Mr Wong passed away, the Claimant’s salary was between RM25,000 and RM30,000; and
- Held that the Claimant’s contractual salary was RM27,500.
Against those findings, our Client advanced the proposed Question of Law before the Federal Court, accepting the Industrial Court’s findings of fact as the starting point for the proposed Question of Law.
The Question Before the Federal Court
It is, of course, open to say that the Industrial Court’s conclusion on the Claimant’s salary was based on the admission made by our Client’s own witness, together with the documentary evidence concerning the payments received by the Claimant. Our Client nevertheless took the position that, in dealing with the EPF and SOCSO statements from January 2013 to September 2019, the Industrial Court also referred to the possibility of statutory under-declaration, though never pleaded by either party. Hence, the question was whether the Industrial Court could properly rely on a possibility of under-declaration that neither party had pleaded when dealing with the contemporaneous EPF and SOCSO statements in determining the Claimant’s contractual salary.
It is trite law that Courts determine disputes on the basis of the parties’ pleaded facts and issues. In Kuala Dimensi Sdn Bhd [2025] 2 MLJ 238, the Federal Court reproduced the following principle:-
“Parties are bound and must abide by their pleadings. Courts should decide on facts and issues in strict compliance with the pleadings filed by the parties. Should the courts decide on an issue not raised by the parties in their pleadings, the decision is liable to be set aside.”
If it is trite law that Courts should not determine disputes upon facts not pleaded by the parties, does the same principle also extend to the manner in which the Industrial Court deals with contemporaneous documentary evidence by relying upon a factual basis that was never pleaded?
That was the question our Client sought to place before the Federal Court.
The Federal Court ultimately refused leave. Whether the proposed Question justified the grant of leave was, of course, a matter for the Federal Court. The purpose of this article is simply to share the legal issue which our Client sought to place before the Court, and to highlight a procedural question which arose in the course of the Industrial Court proceedings.
For readers interested in the procedural history, the litigation progressed through the following stages:-
- Wong Jun Kit v Wong Forklift Hire & Services Sdn Bhd [2023] 2 LNS 2131
- Wong Forklift Hire & Services Sdn Bhd v Mahkamah Perusahaan, Malaysia & Anor [2025] MLJU 1957
Related Coverage:-https://www.freemalaysiatoday.com/category/nation/2025/07/23/high-court-upholds-rm1mil-award-to-ex-manager-for-constructive-dismissal
Note: This article is provided solely for educational purposes and does not constitute legal advice.