Industrial Relations and Trade Unions Quiz

Industrial Relations

• Industrial relations is the relationship between an employer and a trade union representing the workers
• This relationship involves a tripartite system: employers and their associations, employees and trade unions, and the government
• The purpose of regulating industrial relations is to encourage harmonious relationships between employers and employees

Course Objectives

• Identify the definition of industrial relations
• Explain the definition of collective bargaining and a collective agreement
• Explain the role played by Ministry of Human Resources in industrial relations
• Discuss legal forms of industrial action that can be taken by employers and trade union members
• Identify the methods of settling industrial disputes
• Determine the types of trade unions
• Explain the reasons why workers join trade unions and the legal requirements to form and join a union

Trade Unions (TU)

• A trade union is any association of workers (employees) or employers whose place of work in West Malaysia, Sabah or part of Borneo.
• Workers join trade unions to have a voice, gain bargaining power, fight for better wages and benefits, ensure their employment rights are protected, show their solidarity with other workers, and have the opportunity to socialise with others

Legal Requirements to Establish a Trade Union

• All trade unions must be registered with the Department of Trade Unions before starting any activities.
• A group of seven or more workers can form a trade union, provided they work in the same trade, occupation, or industry.
• Applications for registration must be made within one month of the first meeting where the decision to form the union was made.
• If needed, a request for an extension of up to 6 months may be filed to the Director General of Trade Unions (DGTU). A temporary committee may be appointed to handle paperwork
• A trade union must have a registered membership of more than 50% of eligible workers for it to be recognised by the Director-General of Trade Unions (DGIR).

Legal Requirements to Join a Trade Union

• Workers over 16 years old have the right to join a trade union, depending on their employment status.
• Workers under the age of 16 to 21 cannot stand for election as an executive of a union or participate in a strike ballot.
• Members of the Royal Malaysian Police, prison services, and the Armed Forces cannot join a trade union.

Types of Trade Unions

• National Unions of Employees: Workers in different companies in the same industry, trade, or occupation belong to these unions
• In-house Unions of Employees: Employees in the same company belong to these unions
• Employers' Associations: Employers form their own industry-specific associations. Examples include Northport, KTM, Malayan Commercial Banks Association (MCBA), and Malayan Agricultural Producers' Association (MAPA).

Collective Bargaining

• Collective bargaining is a process where a trade union negotiates terms and conditions of employment and service.
• This includes topics such as salaries, benefits, working hours, annual increment, rest days, public holidays, annual leave, sick leave, and maternity benefits.
• A trade union can invite an employer to start collective bargaining once it's been recognized by the employer as a legitimate representative of the workers.

Process of Recognition

• A union applies for recognition by submitting a form to the employer.
• The employer responds (grants or rejects) within 21 days.
• If the employer refuses or does not respond, the union can report to the Director-General of Industrial Relations (DGIR) who may conduct a membership check.
• If over 50% of eligible workers are members, the DGIR advises the employer to recognize the union
• If recognition is denied, the matter may be referred to the Minister of Human Resources, whose decisions are final.
• A waiting period of six months must be considered before reapplication to be considered.

Collective Agreements

• A collective agreement is a written agreement between a trade union and an employer, outlining the terms and conditions of employment for workers.
• The duration of a collective agreement is at minimum 3 years.
• Collective agreements must cover terms and conditions of employment, special provisions, and facilities for the trade union.

Managerial Prerogatives

• Sections 13(3) of Industrial Relations Act 1967, lists non-bargainable subjects where employers do not need to bargain.
• Managerial prerogatives (functions and rights) are aspects, like promotion, transfer, employment, termination, reorganization, dismissal and reinstatement, or specific duty assignments, that employers can manage without collective bargaining.

Definition of Trade Disputes and Industrial Actions

• A trade dispute is any disagreement between employers and employees with regards to employment, non-employment, terms of employment, or conditions of work.
• Industrial actions are measures taken to address workplace disputes, comprising of picketing, striking or lockouts.

Causes of Trade Disputes

• Wage demands are a primary driver, as they respond to the increased cost of living.
• Working conditions, including adequate provisions of water, heating, lighting, and safety measures, along with reasonable working hours, also contribute to disputes.
• Managerial decisions (autocratic styles, defective policies, and insufficient industrial relations), automation, and machinery modernization may also trigger disputes.

Trade Dispute Settlement

• Trade disputes can be addressed through various methods, such as direct negotiation, conciliation, or arbitration.
• Direct negotiation is an ideal method of settling disputes through consensus-building between the two parties.
• Conciliation involves a third party intermediary to facilitate communication and encourage finding solutions that satisfy both sides.
• Arbitration involves the intervention of a neutral third-party who will decide on the dispute. This is often the last resort in case the previous two methods fail. Arbitration is considered as an binding procedure once the neutral party issues the verdict.

The Right to Take Industrial Action

• The law permits workers to participate in picketing, striking, and employers to engage in a lockout

Picketing

• Picketing is a worker action that involves demonstrating at or near a workplace, typically with signage.
• It's legal if it's undertaken peacefully and does not impede access to the workplace.
• It is used as an action to obtain or communicate information to the employer, persuading other employees to stop work in support of the ongoing dispute and conveying the trade dispute between the workers and their employer to the outside world.

Strikes

• A strike is a collective cessation of work by a group of workers in order to pressure the employer.
• Workers must follow certain procedures like obtaining a two-thirds agreement, and holding a ballot before starting a strike.
• A strike is legal if it involves workers in a trade union, they have a trade dispute, and a secret ballot is conducted.

Lockouts

• A lockout is similar to a strike, but it involves the employer refusing to allow workers to enter the workplace.
• It is typically used to resolve a dispute around employment terms and conditions.
• Lockouts typically occur when employers and workers are unable to reach agreement regarding their respective employment terms and conditions.

Summary

• Industrial relations focuses on the relationship between employers and employees and any relevant trade unions.
• Disputes may arise if the terms and conditions of employment cannot be agreed on. There are different approaches in settling such disputes formally.