Court of Appeal holds that an injured employee has right to claim aggravated and exemplary damages for employer’s gross negligence

28 January 2021

Rajendiran Manickam & Anor v Palmamide Sdn Bhd & Anor [2020] 9 CLJ 510

In Rajendiran Manickam & Anor v Palmamide Sdn Bhd & Anor, the employees (“plaintiffs”) suffered severe burns as a result of an explosion and fire resulting from welding works done in another part of the factory by the employers’ (“defendants”) contractors. Whilst the plaintiffs received compensation from the Social Security Organisation (“SOCSO”), they also claimed for damages for negligence, breach of statutory duties and occupiers’ liability arising out of the injuries they sustained.

The Court of Appeal decided on two issues: (1) whether the plaintiffs, being employees who sustained injuries in a factory arising not from their work, could be said to have sustained “employment injuries” and (2) whether section 31 of the Employees’ Social Security Act 1969 (“SOCSO Act”) barred a common law claim in light of section 28A of the Civil Law Act 1956 (“CLA”) and the repeal of section 42 of the SOCSO Act.

The first issue depended on whether the plaintiffs should be given a right to claim for aggravated and exemplary damages for gross negligence on the part of the defendants. The court held that there was no reason why an employer, by virtue of contributions made towards the SOCSO compensation scheme, would be immunised against all claims for aggravated and exemplary damages if the employers were grossly negligent in providing a safe place of work for their employees. It was also held that any ambiguity in a social piece of legislation like SOCSO has to be resolved in favour of the injured employee.

On the second issue, the court held that whether or not section 28A of the CLA applied to an “employment injury” was a matter that should be more fully argued at the trial in the Sessions Court. The court ordered for the matter to be sent back to the Sessions Court for trial.