Question 147. Where the Employer has stipulated in the ILR that the condition for the Employee to be applied disciplinary action is that the violation must lead to corporate damage, how does the Employer deal with the issue, especially while determining any damage related to the reputation and prestige of the enterprise, it is difficult to quantify the damage extent in terms of monetary value or even impossible to prove any arising damage?


As discussed above, in principle, the Employer is not obliged to prove that the enterprise has suffered actual damage caused by the violation of the ILR upon taking disciplinary action against the Employee as mentioned above when applying labour discipline to the Employee. The matter of proving the actual damage suffered by the enterprise, if any, is only raised if the Employer wants the Employee to be liable for material damage, i.e., compensating for any corporate damage caused by the violation.

However, if the ILR of the enterprise stipulates that the condition for the Employee to suffer a disciplinary action is that the violation must lead to corporate damage, the Employer is obliged to prove the actual damage in accordance with the ILR before issuing a decision to discipline the Employee. According to the general principle of the Civil Code 2015, actual damages are determined to include physical damage and mental damage. From experience, proving actual damage of both said types, especially mental damage is not easy at all, due to the lack of clear criteria for determining the mental damage of an individual or organisation. If falling into this case, the Employer almost comes to a deadlock and it is difficult to discipline the Employee, even if the Employer can demonstrate that the Employee has violations but cannot prove the actual damage of the enterprise. Therefore, if the Employer wants to discipline the Employee the best solution is that the Employer should not be “self-binding upon their obligation to prove any actual damage” to the enterprise due to this violation since the time of formulating the ILR.