Singaporean case offers insights on internal probes for employers
In a recent decision, the High Court in Singapore provided valuable insights into employers' obligations during workplace investigations. The case involved an employee alleging that his employer mishandled and breached implied duties during an internal investigation, which negatively impacted his career advancement.
Mayumi Soh, an expert in employment law at Pinsent Masons, commented on the decision, stating it sheds light on the potential applicability of implied terms in employment contracts. According to Soh, the court's decision highlights that even with absolute discretion stated in the employment contract, employers owe implied obligations regarding the manner in which such discretion is exercised.
The court's decision serves as a reminder that wide contractual discretion does not absolve employers from the duty to act fairly and reasonably in the exercise of such discretion. The employee was allowed to pursue allegations that the employer did not exercise contractual discretion fairly and reasonably in awarding bonuses and salary increases.
The court's decision also emphasizes instances where employers may be held accountable for how they exercise discretion, even when contracts seem to grant absolute discretion. This is particularly relevant when it comes to the fairness of investigative processes and the reasonable exercise of discretion in matters such as bonus and salary decisions.
The employee was also allowed to allege procedural unfairness in the investigative process, which could have led to lost career opportunities. The court allowed claims that the employer failed to conduct the internal investigations and internal audits in a fair manner to proceed.
The court indicated that the issue of an implied term in employment contracts under Singapore law is currently unsettled. However, the employee's claim includes the question of whether an implied term of mutual trust and confidence exists in employment contracts under Singapore law.
The High Court's decision serves as a cautionary reminder for employers to exercise their discretion fairly and reasonably, especially during workplace investigations. It underscores the importance of fairness and reasonableness in the exercise of discretion, even when contracts grant absolute discretion.
In conclusion, the High Court's decision provides valuable guidance for employers on their obligations during workplace investigations. It emphasizes the need for fairness and reasonableness in the exercise of discretion and highlights the potential applicability of implied terms in employment contracts.
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