The Supreme Court has ruled that, in termination or dismissal cases, the primary burden of proof rests with the employer.
In a 12-page judgment authored by Justice Muhammad Ali Mazhar, the court held that employers must establish alleged misconduct through clear, credible, and unbiased evidence sufficient to support a conclusion beyond a reasonable doubt.
“The primary burden rests on the employer to prove the misconduct so that the matter may be decided on the preponderance of evidence,” the judgment stated. It added that disciplinary action must be free of bias, retaliation, or other prejudiced motives.
The case arose from the dismissal of an employee accused of submitting a bogus medical reimbursement claim of Rs 10,000 following a root canal treatment in September 2015. After seeking reimbursement in accordance with company policy, the employee received a show-cause notice from HR alleging fraud.
The employee denied the allegation, participated fully in the inquiry, and submitted a verified medical bill and payment receipt. Despite this, the employer dismissed him from service in March 2016 following adverse findings from an inquiry.
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The employee initially approached the National Industrial Relations Commission (NIRC), which dismissed his grievance on a single-bench decision. However, a full bench of the NIRC overturned that decision, ordering reinstatement with all back benefits.
The employer then moved to the Sindh High Court (SHC), which set aside the NIRC’s ruling. The matter ultimately reached the Supreme Court. There, a three-member bench overturned the SHC’s decision and restored the NIRC full bench order.
The Supreme Court found serious procedural flaws in the employer’s inquiry. It noted that when contradictory medical receipts were on record, the inquiry officer had a duty to summon a hospital or clinic representative for verification. This included allowing cross-examination.
“The failure to call a key witness destroyed the evidentiary value of the inquiry,” the court observed. The judgment stressed that employees cannot bear the burden of proving their innocence. It clarified that even domestic or departmental inquiries must uphold minimum standards of fair trial and natural justice.
The court acknowledged the employer’s right to initiate disciplinary proceedings but emphasised that such action must follow lawful procedures, be transparent, and ensure equal treatment. “Mishandling misconduct cases undermines industrial relations and erodes trust between management and workers,” the judgment said. It warned that arbitrary actions damage workplace harmony.
The court further stressed that allegations of misconduct carry greater consequences for employees. Therefore, rigorous verification and due diligence are essential before finding guilt. The verdict reinforces long-standing labour law principles. It sets a clear precedent that employers must independently prove misconduct, rather than relying on assumptions or incomplete inquiries.
