Case Background & Strategy

By Lawyer Bernice Ng

You Feel Your Employer Is Pushing You Out. So You Resign. What Happens Next?

There is a dangerous assumption among employees:

“If my employer is making my working life unbearable, I can resign and claim constructive dismissal.”

Not necessarily.

In Malaysia, an employee cannot simply walk away because he or she feels sidelined, excluded or pushed out.

A recent Industrial Court decision is a useful reminder of just how risky that can be.

In Award No. 63 of 2026, the Industrial Court dismissed a constructive dismissal claim brought by an employee who believed that her employer was gradually taking away her responsibilities and replacing her with another manager.

A Little Bit of Background…

In April 2022, the employee was informed that the company intended to “reposition” her and adjust her responsibilities. Shortly afterwards, another employee was appointed as Group Industrial Ecology Manager. She believed that the new appointment effectively took over her existing responsibilities.

Two days later, she tendered her constructive dismissal notice.

But the Industrial Court did not see it that way.

Feeling Pushed Out Is Not Enough

A constructive dismissal claim is not determined simply by asking whether an employee felt that the employer was pushing him or her out.

The Court applied the established contract test, considering whether the employer had committed a fundamental breach going to the root of the employment contract.

The Court noted that there was no formal letter of reassignment or redesignation. Her salary, grade and benefits remained unchanged.

More importantly, the alleged changes had not been conclusively implemented in the manner she alleged. The Court therefore found that much of her case was based on her own assumptions about what the restructuring meant, rather than evidence of an actual fundamental breach. The Court accepted the Company’s evidence that the newly appointed manager had a different role and that there had been no actual handover of the employee’s work.

The Most Dangerous Mistake? Walking Away Too Early.

The Court found that the employee had acted before the alleged breach had actually crystallised. In other words, she had effectively “jumped the gun.”

There was another important issue in this case.

The Company’s Staff Code contained an internal grievance mechanism. Complaints were required to be escalated through the management hierarchy. The employee did not fully utilise that process.

The Court considered this significant and held that she had effectively abandoned her rights, claims and grievances by failing to exhaust the available internal mechanism. The Court also referred to Metroplex Administration Sdn Bhd v Mohamed Elias in reinforcing the importance of internal remedies.

This highlights an equally important lesson for employers.

Employers: Your Grievance Procedure Is Not Just a Policy Document

A proper grievance procedure can provide employees with a channel to raise concerns before matters escalate into resignation and litigation.

A well-structured and properly implemented grievance mechanism can become important evidence when a dispute eventually reaches the Industrial Court.

What Should Employees Do Before Resigning?

If you believe your employer is forcing you out, consider:

1. Read your employment contract.
Understand your job scope, reporting structure and grievance procedure.

2. Document what actually happened.
Keep relevant emails, letters, messages, organisation charts and instructions.

3. Separate facts from assumptions.
What did the employer actually do? What are you merely anticipating?

4. Raise your concerns formally.
If there is an internal grievance procedure, understand it and use it where appropriate.

5. Get legal advice before resigning.
Once you resign, the legal position may become significantly more difficult to manage.

Not sure where you stand? We can help.

Our team advises employees and employers across a wide range of employment and industrial relations disputes, including fixed-term contract challenges, wrongful dismissal claims, and Industrial Court proceedings.