norhayati mohd salleh adm 465 topic 7 1 topic 7 industrial disputes and industrial actions upon...

Norhayati Mohd Salleh ADM 465 TOPIC 7

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TOPIC 7INDUSTRIAL DISPUTES AND

INDUSTRIAL ACTIONSUPON COMPLETING THIS TOPIC, STUDENT SHOULD BE ABLE

TO:• Distinguish industrial disputes from industrial actions.• Outline the causes of industrial disputes.• Identify suitable methods to resolve industrial disputes.• Distinguish industrial actions by employer from industrial actions by

employees.• Outline the causes of industrial actions.• Elaborate the procedures or requirements to carry out industrial

actions legally.• Identify and discuss penalties for conducting illegal industrial

actions.• Evaluate on the advantages and disadvantages of industrial actions

(strikes).


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7.1 INDUSTRIAL DISPUTES7.1.1 DEFINITION

“ Trade disputes…as any disputes between an employer and his workmen which is connected with the employment or the non-employment or the terms of the employment or the conditions of work of such workmen.” (Sec.2, IRA)“ Industrial disputes refers to any type of labour-management conflicts / disputes, including trade disputes.”* the term ‘non-employment’ is not defined in the IRA but it is the negative form of employment. It can occur in the various forms such as dismissal, termination, lay-off, and suspension of an employee by his/her employer.


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7.1.2 CausesSeveral factors have been associated with the occurrence

of industrial disputes as follows:i. The failure of the grievance procedures to conclude

satisfactory results.ii. A difference of opinion as to the appropriate terms and

conditions of service for workers.iii. A difference of opinion as to the interpretation of a

collective agreement or Industrial Court Award.iv. The non-implementation of an agreement or award.v. The refusal of any party to commence collective

bargaining.vi. The refusal of any employer to accord recognition.vii. Disciplinary actions taken by an employer which are

considered as unfair or unwarranted.


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7.1.3 Dispute ResolutionIt refers to the methods to settle trade disputes.• The IRA, 1967 recognises either implicitly or explicitly a

number of ways for that purposes.

• It specifically makes available three methods viz:– Conciliation– Factfinding– Arbitration

• Other methods recognized by IRA are the following:– Direct negotiation– Direct action– Executive action– Executive or administrative action– Mediation


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Dispute Resolution … cont’d

1.CONCILIATION• “Conciliation is the process of arriving at a

settlement of a trade dispute with the help of a third, neutral party.”(Marilyn A.: 1999: pg. 184)

• “Conciliation also means bringing together the two parties involved to resolve their problems.”

• Agency – Department of Industrial Relations• Machinery – Conciliation conference (but, IRA is

silent on the composition, jurisdiction, powers or limitations of the conciliation conference)

• Provision – Part V, IRA


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Dispute Resolution … cont’d - Conciliation

PROCESS

i. It can be voluntary or compulsory.

ii. The parties are encouraged to resolve their problems.

iii. It is up to the parties concerned to reach the agreement.

iv. The conciliator merely arranges the meeting or advice the parties because he has no authority to insist that the parties accept any particular recommendation.


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Situations that require conciliation:

i. If a trade dispute has not been resolved, it must be referred to the DGIR by any party to it for conciliation.

ii. The DGIR may also refer a trade dispute for conciliation if in his opinion the dispute is not likely to be resolved and public interests demand. (Sec. 8 IRA)


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In practice,i. Conciliation is carried out by Industrial Relations Officer(s) who will

meet the parties, either separately or jointly.ii. The conciliator will:• give explanation on the problem• help the parties arrive at a compromise which is acceptable to

both parties.• give advice• He has no authority to insist any party or the parties to accept any

recommendation.iii. His roles are to:• identify the issues• brief the problem• give advice

• * This method is important because 70-80 per cent of trade disputes are settled in this way annually.


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Dispute Resolution … cont’d - Factfinding

2. FACTFINDING• It refers to investigation and inquiry carried

out by specific agencies on any matter that are related or relevant to the dispute.

• Agencies/ machineries – Board of Inquiry and Committee of Investigation (both are appointed by the Minister of Human Resources).

• Provision- Part VIII, IRA 1967.


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2.a Committee of Investigationi. It consists of one or more persons

appointed by the Minister. ii. It has jurisdiction over any trade dispute

referred to it by him.iii. It has the power to investigate the

causes of and the circumstances surrounding the dispute.

iv. It is required to make a report to the Minister ‘as soon as possible’.


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Dispute Resolution … cont’d - Factfinding2.b Board of Inquiryi. It consists of one or more persons appointed by the

Minister.ii. It has jurisdiction over any trade dispute referred to it

by him for fact finding.iii. It has more power than the committee, as follows;iv. The power to inquire into the dispute referred to it.v. The power to summon witnesses to give evidence on

oath or affirmation.vi. The discretion to sit in private or public.vii. The discretion to make Interim Report that must be

laid down before the Dewan Rakyat ‘as soon as may be’.


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Limitation of the agencies

1. A board cannot include in its Report(s) any information, which are confidential in nature, obtained by it in its inquiry about trade union, business or organization without consent.

2. Both agencies are not the bodies that settle the disputes referred to them.

i. The Act requires them to investigate or inquire causes and circumstances surroundings the dispute.

ii. But, in their proceedings before a Board or a Committee- they can permit or not permit a person to be represented by someone else.

iii. So far, no cases of appointment of a Committee or a Board (since the introduction of IRA)Reason?… the Government prefers to refer/ use other methods to settle the disputes.


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3. ARBITRATION• “ Arbitration is a method of settling a dispute whereby the two

parties involved request the third party, or are compelled by law to use a third party to make decision for them”.

• “…is where an impartial third party is given the authority to settle the dispute by examining the information given by both parties and making a judgement.”i. Agency – Industrial Court.ii. Provision – Part VII, IRA.iii. Types – compulsory or voluntary.

• IRA 1967 identify only one agency for arbitration of trade disputes i.e. Industrial Court

• Industrial Court – composition, jurisdiction, powers, awards & appeal. (Please discuss in the tutorial class)


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4. OTHER METHODS RECOGNISED BY THE IRA, 1967a. DIRECT NEGOTIATION• “ … is a method of settling the dispute whereby the

two parties involved are willing to come together for discussion until a satisfactory compromise is reached or concluded.”

• Agency – parties to the disputes.• Provision – none• It is seen as a mature and harmonious way of settling

the dispute.• It is quick, cheap, save ‘faces’, and very effective way

(for settlement/ arriving resolution without involvement the third person).

• It is more likely to result in the permanent resolution of the dispute than resolution arrived through the intervention of a third person.


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Dispute Resolution … cont’d – Other Methods

b. MEDIATION• Mediation is similar to conciliation whereby the

third neutral party is called in by the parties to the dispute to help them find a settlement.

• It is relatively rare method of settling a trade dispute.

• It is not mentioned in the labour laws, but is, occasionally used.

• But, the mediator is not usually from the government (a person who is considered unbiased, impartial and is sufficiently respected and trusted by both parties).


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Dispute Resolution … cont’d – Other Methodsc. EXECUTIVE AND ADMINISTRATIVE ACTIONThe IRA, 1967 makes available two agencies for:i. Executive action i.e. the Minister of Human Resources• Sec. 19A, IRA authorises the Minister to resolve trade

dispute i.e. to conciliate a trade dispute.• Sec.9, IRA authorises him to resolve recognition

dispute (by giving decision).

ii. Administrative action i.e. the DGIR• Sec.19, IRA authorises the DGIR to resolve the trade

dispute.• Sec.9, IRA authorises him to resolve recognition

dispute (i.e. to take any step or make inquiry)


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Dispute Resolution … cont’d – Other Methods

d.DIRECT ACTIONS

These methods refer to industrial actions by employers or employees viz:

i. Lockouts

ii. Picketing

• Strikes

• These actions are taken to ensure that the disputes are settled quickly (which are to be discussed in 7.2)


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7.2 INDUSTRIAL ACTION

• It refers to a direct action carried out by either employers or employees resulted from trade disputes. It is considered as an aggressive and threatening method to settle trade disputes.

7.2.1 CAUSES• The failure of peaceful dispute resolution

methods for resolving any trade/ industrial disputes.

• The attempts of a party to force the other party to give in.

• Employers and employees attitudes such as intolerable etc.


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7.2.2 TYPES

• The types or industrial action can be divided into main categories namely:

• Industrial action by employees such as picketing, strikes, boycott and sabotage but, the only forms of employees’ industrial action permitted by the labour laws are picketing and strikes.

• Industrial action by employers i.e. lockouts


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7.2.3 INDUSTRIAL ACTION BY EMPLOYEES

a. Picketing• It refers to a situation whereby “ one or more

persons may attend at or near the place where the workman works and where a trade disputes involving such worker exists only for the purpose of peacefully: -i. Obtaining or communicating information, orii. Persuading or inducing any workman to work or abstain from working (if a strike has taken place) (Sec. 40 (1), IRA)

• * Picketing is the most common form of industrial action in Malaysia.

NORHAYATI MOHD SALLEH PAD 365

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Picketing … cont’d

Conditions

Picketing must not: -

i. in the workplace

ii. intimidate any person

iii. lead to breach of the peace

iv. obstruct the entrance or exit

v. allow workers who are not directly involved in the trade dispute to take part.(Sec. 40 (1)(2)

NORHAYATI MOHD SALLEH ADM 465

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Picketing … cont’dObjectivesThe main objectives are the following:i. To pressurize the employers to settle the

dispute or to fulfill their claims quickly.ii. To inform/ communicate certain issue to

public.iii. To give the employer a lesson.* Picketing is an early stage towards more serious

action.* Usually picketing is carried out during lunch hour,

before or after working.


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Picketing … cont’dUnlawful picketing• The employees’ action of picketing become

unlawful if they do not conduct it according to the requirements of the said provision i.e. Sec. 40. IRA.

Punishment:

Any contravention can be convicted the following: -

a. An imprisonment for a term not exceeding one year, or

b. A fine not exceeding


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b. StrikesMany definitions can be given.i. A strike can be defined as “ an action carried out by

the employees collectively whereby they withdraw themselves from work or, refuse to continue performing their present works/ jobs or, refuse to perform the jobs assigned by the employers or, stop/ delay their work which result in lower performance which affect the organisation’s production”. (Sec.2, IRA)

ii. In brief, “ a strike is any stopping of work by a group of workers, including any attempt to limit or slow down production on purpose.” (Maimunah Aminuddin, 2006)

iii. Strikes are only legal if they comply with the regulations in the Industrial Relations Act and Trade Unions Act. As such, the right to strike is only extended to members of a registered trade union.


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Strikes … cont’d

Forms of strike

i. Legal strike

ii. Illegal strikes which refer to actions such as lightning/ wildcat strike, sympathy strike, political/ general strikes.


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Illegal strikesSympathy strike• Occurs when a group of workers who are not involved in a trade

dispute decide to go on strike to show support and solidarity with another group of workers who are legitimately on strike.

Political/ General strike• This type of strike aimed not at employer but at the government.

The striking workers hope to force the government into giving in to certain demands. They assume that their strike may disrupt the economy and, therefore, pressure the government into giving in to them.

Wildcat strike/ Lightning strikes• This strike refers to a type of strike which is called without taking

any ballot or following the procedures. The workers make a decision to strike and do so immediately. They can be said to “down tools”, i.e. refuse to go on with their work. Such strike occasionally occurs, especially in the agricultural estates, but the strikes are not supported by their union and such action is strongly discouraged.


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Strikes … cont’d

Strikes procedure

• Unlike registration and recognition of trade unions and collective bargaining, the industrial relations laws do not clearly lay out the procedures to be followed to ensure the legality of a strike.

• But, various requirements and restrictions are found in both the Trade Union Act and Industrial Relations Act. The requirements and restrictions are the following:


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Strikes procedure … cont’d(a) Industrial Relations Act, 1967

(i) Sec. 45, IRA• This section deems a strike or lockout illegal if: -

a. it is declared or commenced or continued in contravention of Sec. 43 or Sec. 44, or of any provision of any other law; orb. it has any other object than the furtherance of a trade dispute:

• between the workmen on strike and their employer or• between the employer who declared the lockout and his

workmen.However, the Act declared the consequence of an illegal

lockout, which is deemed illegal by the Act.


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Strikes procedure … cont’d

(ii) Sec. 44, IRA

• This section prohibits a strike or a lockout in specified circumstances such as after a trade dispute has been referred by the Minister to the Industrial Court for arbitration and the parties thereto have been notified of the reference.


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Strikes procedure … cont’diii) Sec. 43, IRA• It restricts a strike or a lockout in the “Essential

Services”. It does not prohibit a strike or a lockout in these services but requires only appropriate notice of them.

iv) Section 44(b), IRA• “ No workman shall go on strike and no employer of any

such workman shall declare a lock-out after a trade dispute or matter involving such workman and such employer has been referred to the Court and the parties concerned have been notified of such reference.


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Strikes procedure … cont’d(iv) Sec. 46 to 48, IRA• These sections make an offence, punishable on

conviction by fine and/ or imprisonment, for an employee or an employer to participate in, or to instigate others to participate in, or even to support (by financial means) a strike or a lockout deemed illegal by it.

(v) Section. 49, IRA • This Act protects union members who refuse to

participate in any illegal strikes or lockout.


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Strikes procedure … cont’d(b) Trade Union Act, 1959(i) Section 25(A)1, TUA• This Section prohibits an employee union from calling a

strike or an employer union from declaring a lockout under the following circumstances:

– without first obtaining the consent from majority of members (at least two thirds)

– before the expiry of 7 days after submitting to the DGIR (Sec. 40(5) TUA)

– if the secret ballot become invalid (by virtue of Section 40 (2), (3), (6) or (9) TUA

– in contravention or without complying with the rules of the union

– in respect of matter covered by a direction or a decision of the Minister

– in contravention or without complying with the TUA or any other law.


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Strikes procedure … cont’d(ii) Section 40, TUA• This section requires a trade union to take a secret ballot to

make a decision on inter alia any matter relating to a strike or a lockout. (a secret ballot must held by those eligible to strike).

• The results of this ballot must be sent to the Director- General of Trade Unions by the union secretary within 14 days of taking the ballot. The strike can only take place if two-thirds of those entitled to vote agree to the action, and after waiting 7 days after the ballot results have been sent to the Director General.

• This compulsory “ cooling –off period is intended not only to allow the Director General time to check the validity of the ballot, but it also gives the union members time to change their mind.

• With this threat of an impending strike, the employer may give in to the employees’ demands or they themselves may have second thoughts, given the seriousness of their impending action.

• This 7-day period allows the Minister of Human Resources to intervene and refer the dispute to the Industrial Court for arbitration, thus making a strike illegal.


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7.3 INDUSTRIAL ACTION BY EMPLOYERS

Lock-outsSec. 2 IRA defines a lockout as,• “ the closing of a place of employment, the suspension

of work, or the refusal by an employer to continue to employ any number of workers employed by him, in furtherance of a trade dispute, done with a view to compel those workers to accept terms or conditions of work or affecting employment.”

* The procedure for lock-out are the same as those for a strike:

i. IRA Sec. 43, 44, 45, 46, 47, 48 & 49 ii. TUA, Section 25(A)1 & 40


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Discussion questions1. Distinguish trade disputes from industrial

disputes.

2. Differentiate between conciliation and mediation.

3. Explain the circumstances where a strike is not allowed by the Malaysian labour laws.

4. Elaborate on the process of arbitration to resolve trade disputes.

5. Contrast between legal and illegal strikes.

6. Explain the pros and cons of lockouts.

norhayati mohd salleh adm 465 topic 7 1 topic 7 industrial disputes and industrial actions upon...

Documents

ira industrial disputes

causes of industrial

causes of industrial

illegal industrial actions

conciliation conciliation

industrial court award

norhayati mohd salleh

ira slide