1.overview of industrial relation

8/11/2019 1.Overview of Industrial Relation

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1 | P A D 3 6 5


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2 | I N D U S T R I A L R E L A T I O N S

1.1 INTRODUCTION

This lesson focuses on the concept of industrial relations and several relevant

aspects. It comprises four main parts. The first part describes the definition and

principles of industrial relations. The second part is about harmonious industrial

relations i.e. definition and principles. Part three consists of the types of decision

making in the industrial relations system. Part four outlines the roles and functions of

government in the industrial relations. This will help you to acquire an in-depth

understanding of this topic.

1.2DEFINITION AND PRINCIPLES OF INDUSTRIALRELATIONS

Definition

Many definitions have been given to the term industrial relations. In the simplest

words it can be understood as the relationship between employees and their

employers within the work environment. The relationship also involves trade unions.

Therefore, the relationships are between employers and unionized as well as non-

unionized employees.

1.3 PRINCIPLES OF INDUSTRIAL RELATIONS

In Malaysia, the employersemployees relations (in the private sector) are governed

by the Industrial Relations Act (IRA) 1967. This Act establishes the principles on

which the relations are founded. The principles are the following:


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I. Trade Unionism

This principle states that workmen (and employers too) are entitled to basic

trade union rights such as the right to form unions, the right to join unions,

and the right to participate in the activities of unions.

II. Union Recognition

The principle explains that employee unions must be recognized by

employers as a legal or official representative before they represent

employees to bargain whether individually or collectively.

III. Collective Bargaining

This principle guides how employee unions may negotiate with employers

the terms and conditions of employment and work of workmen, and may

conclude with employers binding and enforceable written agreements

incorporating the terms and conditions agreed upon.

IV. Dispute Resolution

This is the principle that attempts to offer the effective resolution of conflicts

between disputing parties. Employers, workmen and their unions should, if

possible, be prevented through a grievance machinery or collective

bargaining, and if not, be settled through conciliation or arbitration, rather

than aggressive methods or industrial action (i.e. strikes, lockouts etc).

1.4 DEFINITIONS AND EFFECTS OF HARMONIOUSRELATIONS

Harmonious industrial relations

Harmonious industrial relations refer to peaceful relationship between employers or

management and employees. Sometimes people use the term sound industrial

relations as harmonious industrial relations. The relation is considered harmonious


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when the number of disputes and industrial actions are minimal. The relationship is

also considered harmonious if both parties choose peaceful ways to settle the

conflict. In addition, successful dispute resolutions at the early stage also indicate the

availability of harmonious industrial relations.

Effects of harmonious industrial relations

The effects of harmonious industrial relations can be seen from three levels i.e.

national (country), industry and organisational (enterprise) level.

1. Effects On The Country

Harmonious industrial relations have effects on national productivity andprosperity. It can ensure political stability, economic development and

social well-being among people in the country.

2. Effects On The Industry

Industries will also gain benefits from harmonious relationship. Good

industrial relations help in uninterrupted production by ensuring continuity

of production, continuous employment and full utilization of capacity. Thisresults in maximum production which in turn keeps income flow steady for

everyone involved in production. This also results in timely arrival of goods

at the market thus helping economy development as a whole.

3. Effects On The Organisation

The effects of harmonious industrial relations are obviously seen at the

organisational level i.e. employer and employees. By maintaining excellent

industrial relations the wastage of machines, materials and men can be

reduced. Mutual understanding and cooperation may avoid industrial

dispute that help organization to save cost. Peaceful industrial relations

makes employees feel appreciated, keeps employees moral high and

enables them to work with sincerity and enthusiasm. Sound industrial

relations reduce the numbers of industrial disputes and industrial actions.

Proper elimination of workers' dissatisfaction results in peaceful industrial

surroundings and increased production.


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1.5 TYPES OF DECISION MAKING IN THE INDUSTRIALRELATIONS SYSTEM

Governments, employers and employees are three players in industrial relations.

These groups may interact differently in making decisions related to work life. The

decisions can be made in any of these three ways:

I. Unilaterally

The decision is made by one party in disregard for other parties i.e. the

employers. Decisions are made by the management on behalf of theemployer without any interference by employees or any other party. People

tend to associate this way of making decisions in the Malaysian public

sector industrial relations.

II. Bilaterally

The decision is made by two parties i.e. employers and employees. The

best example is collective bargaining practices.

III. Tripartite manner

The decision is made by three parties i.e. employers, employees and

government. Arbitration is a good example where decisions are made by

Industrial Court (government), employers and employees.

1.6 ROLES AND FUNCTIONS OF GOVERNMENT IN THEINDUSTRIAL RELATIONS

I. Legislator

This is the role where the government legislates or enacts law through the

Parliament. Examples of legislations are the Trade Unions Act 1959 (TUA)

the Industrial Relations Act 1967 (IRA) and the Employment Act 1955 (EA).


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II. Administrator

The government performs this role through the Ministry of Human

Resources. The core activity is enforcing the above three legislations i.e.

translating written laws into actual action and taking corrective actions

when necessary.

III. Participant

This role is performed by the Minister of Human Resources in the Code of

Conduct for Industrial Harmony and the National Labor Advisory Council.

The Minister with the help of MTUC and CUEPACS formulates appropriate

industrial relations policies and promote peaceful industrial relationspolicies.

IV. Employer

The federal government plays this role as the largest employer in the public

sector. People are hired to fill vacant positions available in this sector.

Salaries and benefits are provided to compensate them.

2.7 SUMMARY

The establishment of Malaysian industrial relations is based on certain principles.

The ultimate aim is to achieve peaceful relationship between employers and

employees in both sectors. In addition, government has specific roles pertinent to

ensure sound industrial relations.


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This i s one o f comm only ask ques t ions fo r th i s l esson .

Explain the roles and functions of government in industrial relations. (10 marks)1. Legislator make law

2. Administrator translate laws into actual actions and take corrective

actions

3. Participant take part in the discussion and endorsement of documents

4. Employer hire people, allocate tasks and, provide salaries and benefits

At th i s po in t you shou ld be ab le:

To explain the effects of non harmonious industrial relations.

To explain the principles where private sector industrial relations arefounded.

PART A : DEFINITION

Define the following terms:1. Legislator

2. Administrator

3. Participant

4. Government

5. Bilateral


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PART B : SHORT ANSWER

Answer the following questions:

1. Explain the impacts of harmonious industrial relations on organizations.

2. Describe the effects of non harmonious industrial relations in a country.

FEEDBACK TO ACTIVITY 1.1

Feedback to Question Sample

Explain the roles and functions of government in industrial relations. (10 marks)

I. Legislator

This is the role where the government legislates or enacts law through the

Parliament.

II. Administrator

The government enforces the labor laws through the Ministry of Human

Resources.

III. ParticipantThis role is performed by the Minister of Human Resources in the Code of

Conduct for Industrial Harmony and the National Labor Advisory Council.

IV. Employer

The federal government plays this role as the largest employer in the public

sector. Government hires people and provides compensation.

( 2.5 marks x 4 points with appropriate explanation = 10 marks )

FEEDBACK TO STUDY QUESTIONS

PART A : DEFINITION

1. Legislator lawmaker

2. Administrator enforcer

3. Participant member or partaker

4. Government a group of people who have the authority to govern the country

5. Bilateral the practice that involves two sides/parties


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PART B : SHORT ANSWER

1. Explain the impacts of harmonious industrial relations on organizations.

i. Can reduce wastage of machines, materials and men.

ii. Mutual understanding and cooperation may avoid industrial dispute that

help organization to save cost.

iii. Peaceful industrial relations makes employees feel appreciated, keeps

employees moral high and enables them to work with sincerity and

enthusiasm.

iv. Peaceful industrial relations reduce the numbers of industrial disputes and

industrial actions.

v. Proper elimination of workers' dissatisfaction results in peaceful industrial

surroundings and increased production.

2. Describe the effects of non harmonious industrial relations in a country.

Politics stable government administration.

Economy national productivity and prosperity, national development.

Social higher standard of living, safety and security of life are protected.


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1.overview of industrial relation

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