Trade unions

 Collective agency of an association of employees

 TU directly empower the workforce through collective bargaining – joint decision-
making between employers & employees -> establish basic T&C of employment

 Collective agreements (unions sign with employers) do not cover union members only
 All workers in an establishment who are eligible to be union members receive the terms
& conditions of service laid down in the agreement (regardless of whether they are
union members)
 Trade unions act as a pressure group on the gov, pushing for the intro of legislation &
systems which will benefit workers
 Workers in most sectors of the economy have been organized into unions

Why do workers join trade unions?

To improve
their
economic
situation

Why do
workers
join trade
union?
To ensure
For social that their
reasons rights are
protected

Economic Motive

 Workers join TU to improve their T&C of service

 Eg. Pay & benefits
 Individual worker alone has limited bargaining power compared with that of the
employer
 In theory, when a worker accepts a contract of employment -> he has entered into the
contract WILLINGLY.
 He understands & agrees to the terms of the contract which have been negotiated
between himself & the employer
 Reality – different
 People need jobs to survive
 When workers join together & form trade unions, they acquire strength
 Worker who associate themselves with the legitimate activities of a trade union are
given protection under the law -> give them power to effectively bargain with the
employer for better T&C
 Basic concept behind TU -> solidarity
 Workers unite tgt to support & help each other in the fight of their rights
 Unity gives them a voice to express their needs and demands to the gov
 Employee needs employer for the wages and benefits he provides
 Employer needs workers to contribute labour (physically or mentally) to his business.

 In order to force the employer into conceding the workers’ demands, the workers must
have the right as a group to REFUSE LABOUR.
 Refusal to work (eg. Going on strike) is an important technique occasionally used by TU.


 TU attempt to improve T&C of employment of workers through the process of
bargaining with the employer -> collective bargaining
 Successful outcome of bargaining is put in writing -> collective agreement (a document
that lays out the terms of employment & benefits to be offered to the workers over a
particular time period)
Protection of rights

 Protect workers against discrimination by their employer

 Eg. Case of SEA Firebricks
 To ensure fair treatment for all
 To minimise & eliminate unfair practices & favouritism
 To protect workers from exploitation
 To protect them from unfair treatment
 To protect job security for workers

Trade unions objectives

 To promote the industrial, social & intellectual interests of its members

 To obtain & maintain for its members
o just & proper rates of remuneration;
o security of employment
o reasonable hours & conditions of work
 To promote the material, social & educational welfare of the members
 To promote legislation affecting the interests of the members in particular or trade
unionists in general

Definition of Trade Union

“trade union” or “union”

 means any association or combination of workmen or employers,
 being workmen whose place of work is in Peninsular Malaysia, Sabah or Sarawak, as
the case may be, or
 employers employing workmen in Peninsular Malaysia, Sabah or Sarawak, as the case
may be—
(a) within any particular establishment, trade, occupation or industry or within any similar
trades, occupations or industries;
(b) whether temporary or permanent; and
(c) having among its objects one or more of the following objects:
o (i) the regulation of relations between workmen and employers for the purposes of
promoting good and harmonious industrial relations between workmen and
employers, improving the working conditions of workmen or enhancing their
economic and social status, or increasing productivity;
o (ia) the regulation of relations between workmen and workmen, or between
employers and employers;
 o (ii) the representation of either workmen or employers in trade disputes;
o (iiA) the conducting of, or dealing with, trade disputes and matters related thereto; or
o (iii) the promotion or organization or financing of strikes or lock-outs in any trade or
industry or the provision of pay or other benefits for its members during a strike or
lock-out;

S5 Prohibition on employers and their trade unions in respect of certain acts

i. No employer shall prevent a worker from joining a union by putting a condition in
his contract of employment
ii. No employer shall refuse to employ a worker on the grounds he is a trade union
member or officer
iii. No employer shall discriminate against a worker (eg. In terms of promotion) on
the grounds he is a trade union member or officer
iv. No worker shall be threatened with dismissal or dismissed if he proposes to join a
trade union, or if he participates in union activities

Who can join a union?

 Any worker over 16 years of age (16 yo) is eligible to APPLY

S2 TUA
 “workman” means any person, (including an apprentice),
 employed by an employer
 under a contract of employment to work for hire or reward and
 for the purposes of any proceedings in relation to a trade dispute
 includes any such person who has been dismissed, discharged or retrenched in
connection with or as a consequence of that dispute or whose dismissal, discharge
or retrenchment has led to that dispute.
 Union members under 18 are restricted in their union activities – not entitled to vote on
matters involving strikes, imposition of a levy & dissolution of the union or amendment
of the rules of the trade union.
 Union members under 21 – not eligible to be elected as officers of the union
 Students cannot join TU unless they are bona fide workers & over 18 yo (a worker
granted study leave by his employer & who enrols at a local college or university would
still be eligible for union membership, as would a worker who is studying part-time)
 Rules for membership in public sector ≠ private sector

Anti-union Strategies – The law’s response

  In some areas, the law appears quite settled such as in the area of subjective
discretion of the DGTU in deciding whether or not to register or de-register a TU.
 It is well within the powers of the DGTU to decide the issue of registration, and the
court will not interfere so long as the DGTU has acted in good faith as required by
law.

Contracting-out

Syarikat E-Rete (M) Sdn Bhd v Non-Metallic Mineral Products Workers Union

 The company dismissed a total of 65 workers in various stages soon after

the conclusion of the 5th collective agreement between the union & the
company
 Ground of dismissal: it suffered substantial losses in 1986 & 1987
 However, the company offered contract employment to the dismissed
workers. Some workers accepted the offer.
 The union disputed: the dismissal was unjust
 IC proceeded to examine the company’s accounts & discovered losses that
for they years in which the company claimed that it had suffered losses the
company actually paid tax totalling some $135k in 1986 & $46304 in 1987.
 The company had itemised the amounts paid in taxes & depreciation as
trading losses, & the court agreed with the union’s contention that this was
INCORRECT accounting.
 Further, the court noted that the company had incurred expenditures for
entertainment & travelling in the years in question (could not substantiate
the company’s allegations of losses in the years concerned)
 The court noted that company was extremely selective in its dismissals:
only the lowest paid, general & production, unionised workers were
dismissed.
 The court concluded: dismissal of 65 workers was pure victimisation &
unfair labour practice
 The dismissal ≠ bona fide
 Unless and employer can show that the nature of the work or duties are
such as can be performed only by contract labour(no direct relationship
with the principal employer. It has a distinct way of working unlike in any
other classes of labour like permanent, temporary, casual etc. The contract
labour system is based on triangular relationship between the user
enterprises, the contractors including the sub-contractors as middle man,
and the worker. The workers are recruited by an outside agency or person
and are supplied to an establishment or engaged on its work), the court will
have to conclude that the employment of such labour is merely to
circumvent the obligations imposed on the employer by law.
Timber Employees Union v Syarikat Rimba Muda Sdn Bhd

 The company started In 1966 but it was not doing well

 1977: the company carried out a survey on ways to improve its
performance & the Board decided to contract out sawing & processing
work
 In the course of this ’reorganisation’ the company retrenched 14 workers
 The union contended that the workers had been dismissed w/o just cause
 All the 14 workers were all employed in factory section & were all union
members
 The union proved how the company was slow to accord it recognition, &
recognition was accorded only upon being directed to do so by the
Minister.
 The company was also not responsive to the unions’ invitation to open
nego for a collective agreement.
 As a result, the union had to have the matter referred to the IC
 The company , through its manager stated in evidence that the company
had not been doing well since 1966
 It carried out a survey of ways to improve its situation in 1977
 The contracting out took effect in 1980
 The union raised the issue of the long time lapse between the survey & the
actual implementation of the contract system. (3 years)
 But the company replied that this was because it was making a detailed &
careful study of the matter before it implemented anything.
 The court ACCEPTED the company’s submission that the retrenchments
were the result of the company’s ‘genuine embarkation on reorganisation
in order to increase productivity’.
 This court laid down its ‘test’ in contracting out cases:
 Where the nature of work is such as can be performed by contract labour
& where management has shown its necessity for reorganisation to
improve productivity, the court cannot come to a conclusion that the
employer’s motive is merely to circumvent the obligations imposed on him
by law.
 -> no safeguard to employee (esp unionised employee)
 It would allow an employer to contract out his work to toehrs who are not
unionised.