By Southeast Asian standards, the trade union movement in Malaysia is quite strong. A look at the history and development of Malaysian trade unionism indicates that public policies played an important role in shaping its direction. The extent of public-sector unionism is also quite considerable. The police, armed forces, prison personnel and high security government officers are forbidden from joining unions in Malaysia, but other public-sector employees are not.
Most public-sector unions belong to the Congress of Unions of Employees in Public and Civil Services (CEUPACS) which, prior to 1980, was affiliated with the Malaysian Trade Union Congress (MTUC), but split due to leadership rivalries. Unions in the public sector are legally empowered to bargain with the Public Sector Departments, but no collective bargaining agreements have been concluded to date. This suggests that the CUEPACS tends to be more political than the MTUC on occasion. Finally, in 1989, the Malaysian Labour Organization (MLO), a rival to the MTUC, was founded, and even though it was supposed to be apolitical, responsible officers of the organization have been connected to various political parties. But it recently joined the MTUC, indicating the prospect for a unified labour movement.
Private sector employers in Malaysia are represented in the central organization known as the Malaysian Employers Federation (MEF). The MEF advises its members on how to deal with trade union claims, helps to prepare counter-proposals, and assists in negotiations of collective labour agreements. It also represents employers on tripartite bodies such as the National Joint Labour Advisory Council and the Wages Council.
It is important to note that matters pertaining to labour and industrial relations come within the jurisdiction of the federal government as stipulated by the Malaysian constitution. Hence the Trade Unions Ordinance and the Industrial Relations Act apply throughout the country. The Ministry of Labour and Manpower has authority to adjudicate disputes under both Acts, the former applying to both the public and private sectors, the latter, predominantly to the private sector.
Even though the unionized sector is relatively small, collective bargaining has been gaining in importance as a method f determining wages, and terms and conditions of employment in Malaysia. Voluntarism is the basis of collective bargaining in Malaysia. When an employer or a trade union serves notice of its intention to commence collective bargaining, the receiving party is required to respond within 14 days. If the response is positive, collective bargaining should commence within 30 days. If negative, or if the bargaining otherwise does not commence within the 30-day period, the party serving notice may notify the Director-General of Industrial Relations who may then take the action necessary to persuade both parties to commence bargaining. If there is still no success at that stage, then a trade dispute will legally exist.
In Malaysia, trade unions have the right to strike provided that t two-thirds majority vote of the members entitled to vote is obtained. The results of the ballots must be filed with the Registrar of Trade Unions, only seven days after which a lawful strike may be held. Strikes inspired by political purposes or sympathy for other workmen are unlawful, and workmen engaged in essential services are permitted to strike only if their employer is notified at least 21 days in advance.
Since the Registrar of Trade Unions is vested with the power to deregister labour organizations, it has become very difficult for workers to carry on any organized protest. Furthermore, strikes cannot legally take place when a recognition dispute is referred to the Industrial Court. Additionally, as the organized sector is very small, the large majority of workers cannot exercise the right to strike.
The dispute settlement machinery n Malaysia provides for conciliation and arbitration. The Industrial Relations Act empowers the Director-General of Industrial Relations and the Minister of Labour and Manpower to conciliate labour disputes. The Director-General can inquire into the causes and circumstances surrounding the dispute and bring th eparties together, or appoint an arbitrator if both parties agree. The Minister can intervene in any dispute for the purpose of conciliation and, if appropriate, may refer the case to the Industrial Court for arbitration. The Industrial Court, constituted under Secton 30 of the Industrial Relations Act 1967, hears cases brought by the parties or referred by the Minister. Its decision is final and binding.
Along with the government, the Industrial Court is central to Malaysia's industrial relations regime. A successor to the Industrial Arbitration Tribunal and the Arbitration Court, it functions to prevent and resolve labour disputes, and take cognizance of collective agreements negotiated by affected parties. In fact, all collective bargaining agreements must be deposited with the Court, which is authorized to compel the parties to amend any portion which does not satisfy the requirements under the Industrial Relations Act. The Court has jurisdiction over four types of cases:
In sum, Malaysia has completed its transition from the British-patterned mode of voluntarism to its own system of arbitration. The governing elites have considered the latter pattern of industrial relations essential in order to attract foreign capital for rapid industrialization. As Barnard has recently stated, "Malaysia currently is torn between promoting foreign investment and developing workers rights. Years after the successful implementation of various incentive plans designed to attract foreign investment, Malaysia's labour force has become increasingly restless.