MGT340 Human Resource Management Topic 8 - Industrial Relations PDF

MGT340 HUMAN RESOURCE MANAGEMENT TOPIC 8: INDUSTRIAL RELATIONS COURSE OBJECTIVE After completing this chapter, students should be able Examine the to: Explain the role played by the reason why Id...

MGT340 HUMAN RESOURCE MANAGEMENT TOPIC 8: INDUSTRIAL RELATIONS COURSE OBJECTIVE After completing this chapter, students should be able Examine the to: Explain the role played by the reason why Identify the worker join trade Ministry of Determine the definition of unions and the Human types of trade industrial legal Resources in requirements to union. relations. industrial form and join a relations. union. Discuss the Explain the legal forms of definition of industrial Identify the Collective action that may settlement of Bargaining and be taken by industrial Collective employers and disputes Agreement trade union members.  DEFINITION OF INDUSTRIAL RELATIONS Industrial relations is the relationship between an employer and the trade union which represents his workers. An industrial relations systems consists of (tripartite system): Employers and their associations Employees and their trade unions The government The purpose of regulating industrial relations procedures is to encourage a harmonious relationship between the two parties (employers & employees)  ROLES OF MINISTRY OF HUMAN RESOURCES IN INDUSTRIAL RELATIONS Responsible for preparing the legislation which establishes the rights of employers and employees. Responsible to enforce labor standards, encourage of safe practices at work and provision of training of the workforce. Actively involved in settling trade disputes Ensuring the maintenance of a harmonious relationship between workers and employers.  TRADE UNIONS (TU) DEFINITION OF TU – Sec 2 Trade Union Act(1959) Any association or combination of workmen or employers whose place of work is in West Malaysia, Sabah or Sarawak 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  THE RIGHT/ LEGAL REQUIREMENT TO ESTABLISH A TRADE UNION All trade unions must be registered with the Department of Trade Unions BEFORE they can begin any activities. Any group of seven or more workers can form a trade union providing they work in the same trade, occupation or industry. Applications to register must be made within one month of the first meeting held at which it was agreed to start a trade union. All union are required to registered with Director-General of Trade Union (DGTU). If this period is insufficient, a request for an extension of up to 6 month may be filed to the Director General of Trade Union. A temporary committee may be appointed to carry out the necessary paperwork. THE LEGAL REQUIREMENTS TO JOIN A TRADE UNION (MEMBERSHIP) 01 02 03 All workers over However, the Members of the the age of 16 workers under the Royal Malaysian years old have the age 16 to 21 Police; members of right to join the cannot stand for any prison service; trade union election as an and members of the depending on where executive of the Armed Forces the worker is union and cannot cannot join or be employed. participate in a a member of any strike ballot. trade union or shall be accepted as a member of any Source: Trade Unions Act 1959: trade union.  TYPES OF TRADE UNIONS Workers in different National Union of the National Teaching Profession companies in Unions of the same (NUTP), The National Employees Union of Bank industry, trade or Employees (NUBE) occupation Membership is TYPES OF In-house confined to Northport union, KTM TRADE Unions of employees to union UNIONS Employees that particular company Malayan Commercial Banks Employers’ Employers form Association MCBA), Associations their own unions Malayan Agricultural Producers' Association(MAPA)  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; such as on salaries, allowances, working hours, annual increment, rest days/ public holidays, annual leave, sick leave/ maternity benefits 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.  PROCESS OF RECOGNITION 1. The union applies for recognition by submitting a prescribed form to the employer. 2. The employer must reply within 21 days, either granting or rejecting the request (with reasons). 3. The employer may contact the Department of Industrial Relations for a competency check. 4. If the employer refuses or does not reply, the union can report to the Director-General of Industrial Relations (DGIR), who may conduct a membership check. 5. If the union represents more than 50% of eligible workers, the DGIR may advise the employer to recognize the union. 6. If recognition is still denied, the matter can be referred to the Minister of Human Resources, whose decision is final. 7. If recognition is not achieved, the union must wait six months before reapplying.  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. Duration: A minimum of 3 years. Contents: Terms and conditions of employment of the workers concerned Special provisions/facilities for the trade union  MANAGERIAL PREROGATIVES NOT TO BE INCLUDED IN A COLLECTIVE AGREEMENT Section 13(3) of Industrial Relations Act 1967: It is important to note that there is a list of nonbargainable subjects on which collective bargaining is not possible if employer refuse to bargain on these subjects. Managerial prerogatives are also referred to as the functions and rights of management which is considered as the discretion of the employer or manager on how to manage its business, not bound by collective bargaining Examples of managerial prerogatives are: Promotion by an employer of any workman from lower grade to higher grade. Transfer by an employer of a workman within the organization of an employer’s profession, business, trade of work, provided that such transfer does not entail a change of detriment of a workman in regards to his term of employment Employment by an employer of any person in the event of a vacancy arising in his establishment Termination by an employer of the service of a workman by reason of redundancy of reorganization of an employer’s profession, business, trade of work Dismissal and reinstatement of a workman by an employer The assignment or allocation by an employer of duties or specific tasks to a workman that DEFINITION OF TRADE DISPUTES AND INDUSTRIAL ACTIONS Trade Dispute Industrial action Sec 2 - IRA: Trade Any measure taken by dispute can be defined employers or employees as “any dispute between to settle a workplace an employer and his dispute about working employee which is conditions. connected with the Picket employment or the non- Strike employment or the Lockout terms of employment, or the conditions of work of any such employee.”  CAUSES OF TRADE DISPUTES Wages The demand for wage increase is the prime-most cause of the industrial disputes. A large number of strikes are being organised to raise a voice against the rise in prices and cost of living. Working Condition and Working Hours There is not ample provision of water, heating, lighting, safety etc. Working hours are also greater. The demand of pleasant working conditions and shorter hours of work are also responsible for labour disputes. Managerial Causes These causes include autocratic managerial attitude and defective labour policies. Modernisation and Automation of Plant and Machinery: The attempt at modernisation and introduction of automatic machinery to replace labour TRADE DISPUTE SETTLEMENT Direct Conciliation Arbitration. Negotiation Once a dispute has been referred to the Industrial Court, it is illegal for the workers to strike on the issues under dispute.  This is the ideal method of settling dispute where both parties come to the negotiation table to solve the dispute amicably. This negotiation process is seen as a matured DIRECT and harmonious way of settling dispute. This NEGOTIATION method is highly encouraged in the Industrial Relation Act. If both party fail to settle the dispute, the solution may have to go to the third party  Process of arriving at a settlement of a trade dispute with help of a third, neutral party. It is carried out by officers of Dept. of Industrial Relations. Can be voluntarily requested by either of disputing parties or Director General of Industrial Relations (DGIR) may intervene in a dispute related to public interest – requiring parties to attend a conciliation meeting. The DG cannot intervene until he is sure the parties’ efforts to CONCILIATI settle the problem themselves through negotiations have failed. ON This is called “compulsory conciliation”. Compulsory conciliation is common in public utilities & other important industries where public might be inconvenienced if a settlement is not found quickly. Conciliation is carried out by Industrial Relations Officer(s) who will meet the parties either separately or together. After a briefing on the problem, he will help them arrive at a compromise which is acceptable to both.  ARBITRATION If even after the intervention of officers from the DIR, the dispute cannot be settled, arbitration may be the only way to settle the issues. The impartial 3rd party is given the authority to settle the dispute by examining information and evidence given by both party before making judgment. Malaysia, only Industrial Court has In the power to arbitrate. THE Malaysian law recognizes two weapon that could be used by RIGHT workers (when a trade dispute TO TAKE occurs) which are Picket and Strike. INDUST And employers have the right to RIAL lockout the workers when a trade dispute occurs. ACTION  PICKET Can be conducted by one or more employees at or near place of work Reasons for picketing: to obtain or communicate information to persuade or induce other employees to stop work 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.  STRIKES “the cessation of work by a body of workmen acting in combination or concerted refusal or a refusal under common understanding of a number of workmen to continue work or to accept employment” It generally involves quitting of work by a group of workers for the purpose of bringing the pressure on their employer so that their demands get accepted. When workers collectively cease to work in a particular industry, they are said to be on strike. It includes stoppages of work, go slow, restriction, reduction, limitation in the performance or execution of the whole or any part of the duties connected with their employment  LOCK OUT Almost similar to strike only this time action is by the employer. The Industrial Relations Act (IRA) 1967 defines lock out as: the closing of a place of employment the suspension of work the refusal by any employer to continue to employ any number of employee employed by him Purpose of a lockout is to force employee to accept the terms and conditions or as a tool to counter the industrial action taken by the trade union of the employees. Procedures for lockout is almost similar to strike.  SUMMARY Industrial relations is the relationship between an employer and his worker, where those workers belong to a trade union. When an employer and a trade union are unable to agree on the contents of a collective agreement, their dispute will be conciliated by the Department of Industrial Relations.