Eight former insurance agents are suing one of the country's top insurance companies in the Kuala Lumpur Industrial Court for unfair dismissal - after the courts took 14 years to decide that they were indeed employees of the firm.

The claimants, led by Lam Peng Chong, are now all over 60 years of age. One of them was reported to be suffering from mental incapacity and could not attend the court hearing today.

The problem started when American International Assurance (AIA) decided to add a clause to their agents' contract in 1982 which stated that both parties were entitled to terminate their agreement by giving the other party a 30-day written notice without the need to give any reason.

"At that time, 168 agency leaders were affected and were not happy with the change in the contract. But all signed the new agreement except the eight of us who refused to budge and were later terminated," Lam told malaysiakini .

"We were not only dismissed without just cause, we were also not paid the commissions that we were entitled to before our services were terminated. We have waited 18 years for this matter to be resolved and we don't know how long more it will take," he added.

Paid taxes

When the case was first brought to the Industrial Court in 1985, AIA raised preliminary objections about the status of the eight men as to whether they were workmen. The company claimed that they were independent contractors.

After 67 hearings spanning a period of three years, the Industrial Court ruled in favour of the eight, saying there were indeed employees by virtue of their terms and conditions of work.

According to the Industrial Court, during the course of their work with the company, the eight paid taxes and contributed to the Employees Provident Fund.

AIA appealed against the decision but lost both in the High Court and at the Court of Appeal in 1999.

Dissatisfied with the Court of Appeal's decision, the company applied to the Federal Court for leave of appeal against the court's decision.

The Federal Court eventually dismissed the company's appeal for leave of application, and the matter was brought back to the Industrial Court today. The court hearing, which is before Industrial Court chairman Abu Hashim Abu Bakar, is expected to last one month.

Case unique

Court of Appeal judge Gopal Sri Ram in his 1999 judgment concluded that, "We have before us yet another instance illustrative of the grave injustices that ensues when a preliminary objection is entertained by the Industrial Court".

"Here is a case where the minister made a reference in 1985. Now after the passage of almost 14 years, all we have is a finding that the respondents are workmen," said the judge.

"The other critical issues, whether the respondents were dismissed and whether their dismissal was for just cause are yet to be decided. Most surely, this cuts across the very purpose for which Parliament passed the Act," he added.

According to counsel for the eight, KP Gengadharan Nair, the Industrial Court will now have to hear whether the eight men were dismissed with just cause, and if they were, the court must then make awards for reinstatements, back wages or compensation in lieu of reinstatement and back wages.

He added that the case was unique because the court's judgment, if it is in favour of the eight, would be a precedent for others in the industry, who faced similar dismissals.

Sudden end

Recently, the MCA Public Services and Complaints Bureau had alerted new insurance agents to the clause in their contracts which could spell a sudden end to their careers.

According to bureau head Michael Chong, many who joined life insurance companies as agents were unaware of the clause until their services were terminated by their companies. There are presently about 80,000 life insurance agents in the country.