Collective Agreements & Labor Relations

• Industrial relations is defined as the relationship between an employer and the trade union representing the workers.
• An industrial relations system consists of employers and their associations, employees and their trade unions, and the government.

Parties in Industrial Relations Systems

• 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

Creating an Environment of Industrial Harmony

• Creating an environment of industrial harmony involves the Minister of Human Resources, Department of Trade Union Affairs, and the Department of Industrial Relations.
• Industrial harmony is necessary for the success of the individual enterprise and the national economy.
• An industrial relations system must manage conflict because conflict is the antithesis of industrial harmony.

Trade Unions

• Workers join trade unions to have a voice, an opportunity to socialize with other workers, show solidarity, gain bargaining power and fight for better wages, benefits, and ensure their employment rights are protected.

The Right to Establish a Trade Union

• All trade unions must be registered with the Department of Trade Unions before starting any activities.
• Applications to register must be made within one month of the first meeting, and a temporary committee may handle the paperwork.

The Right to Join a Trade Union

• Any employee above the age of 16 has the right to join a trade union, except those in the Royal Malaysian Police, the Prison Service, and the Armed Forces.
• Employees in public and private sectors can not 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, combinations are not permitted.
• 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.
• The Trade Unions Act has provisions on who is eligible to be elected as an officer of a trade union, such as President, Vice-President, Honorary Secretary, Treasurer, and Council Members.
• Trade union funds may only be used how the Trade Unions Act stipulates.

Types of Trade Unions

• National Unions of Employees
• In-house Unions of Employees
• Employers’ Associations.
• in 2022 there were 750 employee unions in Malaysia

Malaysia's Largest Employee Unions (2022)

• NU Teaching Profession has 189,000
• NU Bank Employees has 14,000
• NU Plantation Workers has 35,000
• Electrical Industry Workers Union has 14,000
• NU of Telekoms Employees has 9,000

Collective Bargaining

• Collective bargaining is a process where a trade union negotiates with an employer over the terms and conditions of service of employees.
• A trade union can only invite an employer to commence collective bargaining once the employer has recognized it as the legitimate representative of the employer's workers.
• Once a trade union has been recognized by an employer, either party may initiate the collective bargaining process.
• Bargaining sessions occur between negotiator teams that the employer and the union appoint.
• A collective agreement is an outcome of collective bargaining.
• Collective agreements cover ALL employees in the company concerned who are eligible to join the union.
• The duration of collective agreements are a minimum of 3 years.
• Collective agreements contents concern terms and conditions of employment and special provisions/facilities for the trade union.
• Collective agreements include procedures for settling grievances, disputes, transfer of workers, and retrenchment of workers.

The Right to Take Industrial Action

• Employees who belong to trade unions have the right to picket and strike when a trade dispute occurs.
• Employers have the right to lockout workers when a trade dispute occurs.
• A picket is legal if the workers involved are members of a trade union.

Conditions for Legal Pickets

• A trade dispute between the employees and their employer exists.
• It is held at or near the employees’ workplace.
• It does not obstruct entrances/exists to the workplace.
• It is peaceful and does not intimidate anyone.

Conditions for Legal Strikes

• The strikers are members of a trade union.
• The strikers have a trade dispute with their employer.
• A secret ballot is held before starting the strike.
• Department of Trade Unions must verify Ballot papers
• Two-thirds of the workers agree to strike.
• The workers must wait a minimum 7 days before starting the strike activity.

Illegal Strikes

• A strike is illegal if it concerns recognition of a union.
• A strike is illegal if it relates to matters in a collective agreement which has been taken cognizance of by the Industrial Court.
• A strike is illegal if it relates to 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, it is illegal to go on strike

The Cooling off Period

• Conciliation meeting(s) occur at the Department of Industrial Relations.
• If conciliation is 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.

Test your knowledge of labor laws, collective agreements, and industrial relations. This quiz covers topics such as minimum durations for agreements, legal strike conditions, and permissible picketing activities. It also examines the scope of collective agreements and legal lockout conditions.