Constructive Dismissal: Is This Actually What's Happening to You?
ARTICLEINDUSTRIAL COURTEMPLOYMENT
Amirul Syafiq
9/27/20263 min read
Here's the thing nobody tells you: quitting doesn't always mean you chose to leave. If your employer pushed you out the door without technically firing you, the law has a name for that — constructive dismissal — and Malaysia has recognised it since Wong Chee Hong v Cathay Organisation (M) Sdn Bhd [1988] 1 MLJ 92, borrowing the "contract test" from the English case Western Excavating (ECC) Ltd v Sharp.
But — and this trips a lot of people up
"My boss was unreasonable" is not the test. The Court of Appeal made this explicit in Anwar Abdul Rahim v Bayer (M) Sdn Bhd [1998] 2 CLJ 197: the question is never whether the employer's conduct was unfair or unreasonable. It's whether the conduct amounted to a breach going to the root of the contract, or showed the employer no longer wanted to be bound by it. That case also laid out what you actually need to prove: a breach by the employer, serious enough to justify walking out, and you leaving because of it — not for some unrelated reason, and not too long after. The High Court reached the same conclusion in Govindasamy Munusamy v Industrial Court Malaysia & Anor [2007] 10 CLJ 266, setting out the same essential elements — so this isn't a one-off pronouncement, it's a settled position running through both the Court of Appeal and the High Court. Sit on it too long and the law assumes you accepted it.
So what actually counts? Here's a wider spread of what's been recognised:
A demotion dressed up as something else. This is literally what happened to Wong Chee Hong — reassigned overnight from a senior HR role to running a cinema. Also Ang Beng Teik v Pan Global Textile Bhd Penang [1996] 3 MLJ 137 — the Court said a demoted employee can treat that as dismissal.
A pay cut nobody agreed to — unilateral pay cut called out as a breach of a fundamental term (North Malaysia Distributors Sdn Bhd v Ang Cheng Poh [2001] 3 ILR 387).
Not getting paid, or getting paid late. Cited as a fundamental breach (Tan Kok Chai v Mega 9 Housing Sdn Bhd [2020] 2 LNS 0013).
Being made to feel like you can't stay. Older, but still good law: Stanley Ng Peng Hon v AAF Pte Ltd [1979] 1 MLJ 57 described this as an employer "making a workman's life so intolerable so as to force him to resign." It doesn't have to be one big event, a pattern of small ones can add up to the same thing.
Your employer sitting on a harassment complaint. In Justin Maurice Read v Petroliam Nasional Berhad (Award No. 965 of 2017), the Industrial Court found that PETRONAS's poor handling of the employee's assault and harassment complaints — not the assault itself — was what amounted to constructive dismissal. Worth knowing: the breach can be about how the employer responded, not just what triggered the complaint in the first place.
A quick example (made up, not based on any client file): imagine you're told, out of nowhere, that you're being transferred to a different branch — effective almost immediately. When you get there, the title's different, the reporting line's different, and the actual work is nowhere near what you were doing before. On paper it might even say "lateral move," but in substance it looks and feels like a downgrade. No consultation, no real explanation beyond "operational needs." You raise it in writing, get a vague non-answer, and resign shortly after, pointing to the transfer as the reason. That's close to the actual fact pattern in Wong Chee Hong itself — a manager reassigned overnight into a completely different, lower-status role — and it's exactly the kind of "demotion in disguise" that Ang Beng Teik v Pan Global Textile Bhd Penang [1996] 3 MLJ 137 says an employee is entitled to treat as dismissal. Whether it actually holds up still comes down to the evidence — the sudden timing, the mismatch between the new role and the old one, and how quickly you acted on it all matter.
If you think this is you
You've got 60 days from the date of dismissal to file a section 20 representation under the Industrial Relations Act 1967 (post-2020 amendment). Miss that window and it usually doesn't matter how strong your case was. And remember — the burden's on you to prove it, not on your employer to disprove it.
Contributed by:
Amirul Syafiq
Associate
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