2. Chapter 10
INDUSTRIAL RELATIONS

3. PREVIEW The importance of industrial relations.
The role played by the Ministry of Human Resources in industrial relations.
The functions of trade unions, including the legal requirements to form and join a union.
The process of collective bargaining.
The legal forms of industrial action that may be taken by employers and trade union members.
The processes by which industrial disputes are settled—conciliation and arbitration.

4. INDUSTRIAL RELATIONS
Industrial relations is the relationship between an employer and the trade union which represents his workers.
An industrial relations systems consists of:
Employers and their associations
Employees and their trade unions
The government

5. PARTIES IN THE INDUSTRIAL RELATIONS SYSTEM
International Labour Organization
International trade union bodies
The Malaysian Trades Union Congress
The Malaysian Employers Federation
The Ministry of Human Resources
Individual trade unions
Individual employers

6. CREATING AN ENVIRONMENT OF INDUSTRIAL HARMONY
The Minister of
Human Resources
The Department
Trade Union Affairs
Industrial Relations

7. INDUSTRIAL HARMONY AND CONFLICT
Industrial harmony is necessary for the success of the individual enterprise and the success of the national economy.
Conflict is the antithesis of industrial harmony.
An industrial relations system must find ways to manage conflict.

8. TRADE UNIONS Why do workers join trade unions? To have a voice.
To gain bargaining power and fight for more wages, more benefits and less work.
To ensure their employment rights are protected.
To show their solidarity with other workers.
To have an opportunity to socialise with other workers.

9. THE RIGHT TO ESTABLISH A TRADE UNION
All trade unions must be registered with the Department of Trade Unions BEFORE they can begin any activities.
Applications to register must be made within one month of the first meeting held at which it was agreed to start a trade union. A temporary committee may be appointed to carry out the necessary paperwork.

10. THE RIGHT TO JOIN A TRADE UNION
Any employee above the age of 16 has the
right to join a trade union, except employees in:
The Royal Malaysian Police
The Prison Service
The Armed Forces

11. THE RIGHT TO JOIN A TRADE UNION (cont.)
Restrictions
Employees in public and private sectors cannot join the same union.
Employees in statutory bodies can only join in-house unions.
Employees may only join a union covering workers in either Peninsular Malaysia, Sabah or Sarawak (depending on where the employee is working). Combinations are not permitted.

12. THE RIGHT TO JOIN A TRADE UNION (cont.)
Employees can only join a union representing the trade, occupation or industry in which they are working, unless the union is in-house.
Managers, executives, confidential and security staff can only join a union whose members are in the same category as themselves.

13. CONTROL OF TRADE UNIONS
The Trade Unions Act has provisions on who is eligible to be elected as an officer of a trade union (as President, Vice-President, Honorary Secretary, Treasurer and Council Members).
Trade union funds may only be used for purposes stipulated in the Trade Unions Act.

14. TYPES OF TRADE UNIONS TYPES OF TRADE UNIONS National Unions of
Employees
In-house Unions
Employers’
Associations

15. EMPLOYEE UNIONS 1996–2013 Sector 1996 1999 2005 2013 No. Members
Private
292
407,303
328
406,773
390
379,493
462
381,839
Government
136
241,411
125
244,388
127
311,618
244
516,982
Statutory Bodies and Local Authorities 88
79,532 84
74,161 91
69,396 14
673
Total
516
728,246
537
725,822
608
760,507
720
899,494

16. MALAYSIA’S LARGEST EMPLOYEE UNIONS
2009
UNION MEMBERSHIP
NU Teaching Profession ,000
NU Bank Employees ,000
NU Plantation Workers ,000
Kesatuan Guru-guru Melayu ,000
Sarawak Teachers Union ,000
Electrical Industry Workers Union ,000
Telekom Bhd. Employees Union ,000

17. MALAYSIA’S LARGEST EMPLOYEE UNIONS (cont.)
UNION MEMBERSHIP
Non-metallic Mineral Products
Mnfrg. Employees Union ,000
Malayan Nurses Union ,000
Metal Industry Employees Union ,000
Kes. Guru-guru Lepasan Maktab ,000
NU Commercial Workers ,000
NU Petroleum & Chem. Workers ,000
Tenaga Nasional Employees Union ,000
Transport Workers Union ,000

18. COLLECTIVE BARGAINING
Collective bargaining is a process whereby a trade union negotiates with an employer or association of employers over the terms and conditions of service of employees.
A trade union can only invite an employer to commence collective bargaining once it has been recognized by the employer as the legitimate representative of the employer’s workers.

19. THE COLLECTIVE BARGAINING PROCESS
Once a trade union has been recognized by an employer, either party may initiate the collective bargaining process.
Bargaining sessions will be held between teams of negotiators appointed by the employer and the union respectively.

20. COLLECTIVE AGREEMENTS
A collective agreement is a written agreement between a trade union and an employer, or association of employers, concerning the terms and conditions of employment of the employer’s workers.
A collective agreement is the outcome of collective bargaining.

21. COLLECTIVE AGREEMENTS (cont.)
Scope: Collective agreements cover ALL employees in the company concerned who are eligible to join the union.
Duration: A minimum of 3 years.
Contents:
Terms and conditions of employment of the workers concerned
Special provisions/facilities for the trade union

22. COLLECTIVE AGREEMENTS (cont.)
Procedures, for example:
Procedure for settling grievances
Procedures for settling disputes
Procedures for transfer of workers
Procedures for retrenchment of workers

23. THE RIGHT TO TAKE INDUSTRIAL ACTION
Employees who belong to a trade union have the right to:
Picket and strike, when a trade dispute occurs.
Employers have the right to lockout the workers when a trade dispute occurs.

24. PICKETS A picket is legal providing:
The workers involved are members of a trade union.
A trade dispute between the employees and their employer exists.
It is held at or near the employees’ workplace.
It does not obstruct the entrances or exits to the workplace.
It is peaceful and does not intimidate anyone.

25. STRIKES A strike is legal providing:
The strikers are members of a trade union.
The strikers have a trade dispute with their employer.
A secret ballot is held prior to starting the strike.
Two-thirds of the workers agree to strike.
The ballot papers must be sent to the Department of Trade Unions for verification.
The workers must wait for at least 7 days before commencing the strike.

26. STRIKES (cont.) A strike will be illegal in the following situations:
Over an issue relating to the question of recognition of a union
Relating to matters in a collective agreement which has been taken cognizance of by the Industrial Court

27. STRIKES (cont.)
Relating to the managerial prerogatives of recruitment, transfer, promotion, termination of a worker and the allocation of duties to a worker.
After a trade dispute has been referred to the Industrial Court for arbitration.

28. THE COOLING OFF PERIOD
Conciliation meeting(s) will be held at the Department of Industrial Relations.
If conciliation unsuccessful, the Minister of Human Resources will refer the dispute to the Industrial Court for arbitration.
Once a dispute has been referred to the Industrial Court, it is illegal for the workers to strike on the issues under dispute.

29. REVIEW The importance of industrial relations.
The role played by the Ministry of Human Resources in industrial relations.
The functions of trade unions, including the legal requirements to form and join a union.
The process of collective bargaining.
The legal forms of industrial action that may be taken by employers and trade union members.
The processes by which industrial disputes are settled—conciliation and arbitration.