TOPIC 1 OVERVIEW OF INDUSTRIAL RELATIONS Learning Objectives Upon completing this topic, students should be able to: Define industrial relations Explain the principles of industrial relations Discuss harmonious industrial relations and its effects Describe types of decision making in the industrial relations system Discuss the roles and functions of government in the industrial relations Norhayati Mohd Salleh @ Salih ADS 465

1.0 definition and concept Several definitions can be given: Ayadurai (1998 : pg.3) defines industrial relations, “… the relations between employees, employers and their trade union.” In addition, Ayadurai (1998 : pg.4) said, “… is a discipline that concentrates on the management of unionised employees.” Norhayati Mohd Salleh @ Salih ADS 465

Norhayati Mohd Salleh @ Salih ADS 465 Definition… cont’d Maimunah Aminuddin (2006 : pg. 2) defines industrial relations, “… as the relationship between workers and their employers within the work environment.” Industrial relations is also known as employee, labour or employment relations. (Maimunah Aminuddin : 2007 : pg. 2) Focused areas in industrial relations: i. The relationships between employers and trade unions ii. The framework provided by the employment law iii. Disciplinary procedures and termination of the employment contract. (Maimunah Aminuddin : 2007 : pp. 2) Norhayati Mohd Salleh @ Salih ADS 465

Norhayati Mohd Salleh @ Salih ADS 465 1.2 elements Industrial relations comprise several elements as follows: employers – the party (person / body – corporate / unincorporated who employs workmen under a contract of employment (includes the governments and statutory bodies). employees – the party (including apprentices), employed by an employer under a contract of employment to work for hire or reward. contract of employment – any agreement whether oral or writing (and whether express or implied), whereby one person agrees to employ another as employees, and other agrees to serve his employer as a workman. Norhayati Mohd Salleh @ Salih ADS 465

Norhayati Mohd Salleh @ Salih ADS 465 Elements …. Cont’d iv. trade unions – organisations for protecting workmen from exploitation by employers and for promoting the economic interests of workmen. v. labour legislations – labour laws that govern industrial relations such as the Employment Act 1955, the Industrial Relations Act 1967 and the Trade Union Act 1959. (Ayadurai : 1985 : pp 13 – 14) vi. unionism – spirits among workmen to unionise and carry out activities for protecting their interests at work. Norhayati Mohd Salleh @ Salih ADS 465

1.3 the importance of industrial relations Several groups of people need to understand the theory and practice of industrial relations as follows: Workers – to make them know their rights and obligations under the employment laws, aware of the benefits can be gained or risks might be faced by joining trade union and develop healthy attitude towards workplace. ii. Trade union leaders – to enable them perform their roles effectively in protecting workers from greedy employers. iii. Managers – to ensure their effectiveness in dealing with workforce, in improving productivity and increasing profitability of the organisation. Norhayati Mohd Salleh @ Salih ADS 465

the importance of industrial relations … cont’d iv. Lawyers – to ensure their competence in giving advise to their clients, in representing employers/unions and in drafting legally enforceable employment contracts. v. Officers and executives in human resource and industrial relations departments – to carry out their job responsibilities particularly in improving their human skills in order to administer the system wisely . (Maimunah Aminuddin : 2007 : pp 4 - 6) vi. Students – they are future workers, trade unionists, managers, lawyers, officers/executives and employers. Norhayati Mohd Salleh @ Salih ADS 465

1.4 the systems of industrial relations Almost all industrial relations systems are tripartite, i.e. they are made up of three parties/participants/groups – as the following: i. the employer ii. the employee iii. the government These groups may interact differently (in different countries) in making decisions related to work life. The decisions can be made in any three of three ways i.e. : unilaterally bilaterally or tripartite manner (Maimunah Aminuddin : 2007 : pp. 6 – 7) Norhayati Mohd Salleh @ Salih ADS 465

1.5 roles of the government in industrial relations Under the Malaysian Constitution, industrial relations is the preserve of the federal government, as opposed to the state governments. Four roles are played by the federal government as follows: i. legislator – through the Parliament (legislating laws) ii. administrator – through the Ministry of Human Resources (enforcing labour legislations) iii. participant – through Minister of Human Resources (in the NLAC and CCIH) iv. employer – the largest in the country (public sector). (Ayadurai : 1998 : pp. 223 – 240) Norhayati Mohd Salleh @ Salih ADS 465

1.6 impacts of harmonious industrial relations The impacts of harmonious industrial relations can be seen from several aspects as the following: 1.6.1 impacts upon a country i. politics ii. economics iii. social 1.6.2 impacts upon an organisation i. employers ii. employees iii. profitability iv. productivity v. compensation etc. Norhayati Mohd Salleh @ Salih ADS 465

1.7 the Ministry of Human Resources 1.7.1 introduction This Ministry is responsible for administering and overseeing the industrial relations system. 1.7.2 objectives To protect the welfare of workers i.e. safety, health and rights. To promote good employer–employee relationships through a stable and peaceful industrial relations system. To equip the unemployed with basic industrial skills and to improve the skill-level of the workforce; and To assist in maximising the country’s manpower resources through manpower planning. Norhayati Mohd Salleh @ Salih ADS 465

the Ministry of Human Resources … cont’d 1.7.3 Structure This Ministry comprises seven departments namely: i. Department of Labour, Peninsular Malaysia. Department of Labour, Sabah. Department of Labour, Sarawak. Department of Industrial Relations. Department of Trade Union Affairs. Manpower Department. Department of Occupational Safety and Health. Norhayati Mohd Salleh @ Salih ADS 465

the Ministry of Human Resources … cont’d 1.7.4 Related organisations Several categories of organisations namely: (a) Independent organisations These refer to independent organizations that deal with labour matters such as: The Social Security Organisation. The Employee Provident Fund. The Human Resource Development Corporation/Berhad. The Industrial Court. Norhayati Mohd Salleh @ Salih ADS 465

the Ministry of Human Resources … cont’d (b) Companies The National Institute of Occupational Safety and Health (c) Advisory Councils The National Labour Advisory Council The National Council for Occupational Safety and Health The National Vocational Training (www.mohr.gov.my) Norhayati Mohd Salleh @ Salih ADS 465

Discussion Questions: Explain any four (4) characteristics of harmonious industrial relations. Distinguish harmonious industrial relations from non-harmonious industrial relations. Elaborate on the consequences of non-harmonious industrial relations to a country. Evaluate on the practice of industrial relations system in Malaysia. Elaborate on the principles established by the Industrial Relations Act 1967 in the Malaysian industrial relations. Norhayati Mohd Salleh @ Salih ADS 465