Kuala Lampur, June 26 -- Artificial intelligence ("AI") is no longer futuristic. Globally, employers are increasingly adopting AI tools to automate tasks once performed by people, including automated data processing and generative AI platforms. Microsoft's 2025 Work Trend Index reported that 84 per cent of leaders in Malaysia are considering new AI-focused roles. This raises a difficult question: does the adoption of AI automatically justify retrenchment?

AI adoption does not automatically justify retrenchment

The short answer is no. While AI adoption may explain the commercial rationale for business restructuring, the ordinary legal principles governing retrenchment continue to apply. Employers must demonstrate genuine redundancy arisi...