Termination Benefit

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asked on Jul 29, 2013 at 14:21
by   hayatiabubakar
After 15 years of service, a manager was terminated due to the changes that are being driven by a wide range of factors, including meeting customer expectations and improving the operational synergies between MY and PH. As a consequence of these changes the scope of activity for the Manager has reduced in scope to the point that the position of the Manager is no longer required. Also for the past 2 years taking the responsible for the department, he failed. Now our company has offered a termination package according to the Malaysian labour law which we paid 20 days for every years of services (15 years services) + 2 months notice period + annual leaves. But the employees has rejected and wanted to bring this case to court. Appreciate your kind advice. Thank you.
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answered on Jul 30, 2013 at 00:03
by   arun1011
Hi there

1. You see to be referring to the Manager and then at the last sentence suggest employees have rejected. I am assuming that your only referring to the Manager.

2. The Company is entitled to terminate the Manager on the grounds of redundancy which it seems to appear from the brief write up you have provided. Off course the reasons for redundancy must be genuine. However what concerns me is the part where you have stated that he has failed in his responsibility in the last 2 years. This seems to be an issue of his/her performance and the Manager might be able to argue that there was bad faith on the part of the Company wherein the real reason was not so much redundancy but performance issues.

3. Therefore the best advice for the Company is that the termination letter must only refer to the ground of redundancy. On the other hand before proceeding to issue the termination letter, it is best since the Manager has rejected the termination package offered by the Company, to ask him if he has any proposal in terms of termination package. If his proposal is reasonable, then the Company could consider paying him on that basis. In the event the proposal is unreasonable, the Company could proceed to issue the termination letter on the grounds of redundancy.
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