TRADE DISPUTES AND INDUSTRIAL
ACTION
1
•Procedure for dispute
settlement (C4, P2, LL)
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Disputes between employer and employees are
unavoidable.
The threat of industrial action cannot be
avoided, the law will need to interfere on how
to respond to action taken by both the trade
union and individual employees.
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It is defined by the Industrial Relations Act as;
“ any dispute between an employer and his workers
which is connected with the employment or nonemployment or the terms of employment or the
condition of work of any such worker.”
1.
2.
3.
4.
An individual who has a grievance, and is
represented by his union and who has
exhausted the grievance procedure without
getting a satisfactory result;
A difference of opinion between a union and
an employer as to the appropriate terms
and conditions of service for the workers;
A difference of opinion as to the
interpretation of a collective agreement;
The non-implementation of an agreement
or reward.
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The requirements that a dispute must meet;
1) Between workers and their employer
 The dispute must be between workers and their
employer. Under this definition, 'workers' may be
party to a lawful trade dispute and not merely
'employees'.

In addition, in this context, the term 'worker' has
an extended meaning to cover both current
workers and any former workers whose
employment was terminated in connection with
the dispute or where the termination was one of
the factors giving rise to the dispute.
2) Current employer
 The
dispute must be with the current
employer and does not extend to action
taken against a potential future employer.
3) Must be represented by their union.
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When peaceful method fails to settle a
dispute, the trade union may attempt to force
a settlement by using or threatening to use
more aggressive methods.
The two types of industrial actions permitted
by the law are pickets and strikes.
Another methods are boycott and sabotage
which are unlawful.

Industrial action by unionized workers (called
pickets) who either are on, or are trying to
gather support for, a strike by assembling
near the entrance to the employer's premises.
Pickets try to persuade (1) co-workers to join
them, (2) workers of other firms (such as
delivery men) to refuse to enter the premises,
and (3) customers to refrain from doing
business with their employer.
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The Industrial Relations Act (section 40)
allows workers to attend at, or near their
workplace when they have a trade dispute for
the purpose of peacefully giving information
to the public and other workers and to
persuade other workers not to work.
1.
2.
Only those workers directly involved in the
dispute can participate in the picket. An
officer or an employee of the trade union
can be present to ensure that the picketing
is carried out according to the law.
Must not intimidate anyone, must not
obstruct the entrance or exist to the
organisation, and must be peaceful.
3. Do not require a police permit for the activities.
Neither can they be dispersed by the police, as
picketing is a legal activity.
4. Picketing is used both to communicate issues to
the public and to embarrass the employer. This is
done by the display of banners with derogatory
comments about the employers; by requesting
passer-by to show their support by pressing their
vehicle horns and by a willingness to give
information to the mass- media.
In some instances, the mere threat of a picket
publicised in the mass media is sufficient
pressure to force the employer to respond
positively to union demands.
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Section 2 of the Industrial Relations Act define
strike as;
“strike” means the cessation of work by a body of
workmen acting in combination, or a concerted
refusal or a refusal under a common understanding
of a number of workmen to continue to work or to
accept employment, and includes any act or
omission by a body of workmen acting in
combination or under a common understanding,
which is intended to or does result in any
limitation, restriction, reduction or cessation of or
dilatoriness in the performance or execution of the
whole or any part of the duties connected with
their employment”
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A strike is any stopping of work by a group of
workers including any attempt to limit or slow
down production on purpose.
A slow-down or go-slow by workers are
forms of strike under the Industrial Relations
Act.
A mass refusal of the workers to work
overtime would therefore, be a form of strike.
The relation laws do not clearly lay out the
procedures to be followed to ensure the
legality of a strike. The various requirements
and restrictions are found in both the |Trade
Unions Act and the Industrial Relations Act.
Strikes are only legal if they comply with the
regulations in the Industrial Relations Act and
Trade Unions Act.
1.
2.
The right to strike is only extended to
members of a registered trade union.
Strikes must be in furtherance of a trade
dispute. Only where a group of workers
have a trade dispute with their employer can
they take strike action. Sympathy and
political strikes or general strikes are illegal
in Malaysia.
3)
4)
A secret ballot must be held by those
eligible to strike, clearly stating the issues
leading to the proposed strike (Trade
unions Act, section 40). The result of this
ballot must be sent to the Director-General
of Trade Union by the union secretary within
14 days of taking the ballot. The strike only
can take place if two-thirds of those who
entitled to vote agree to the action. The
secret ballot is only valid for 90 days.
The strike can be held only after “coolingoff period” of seven days after submitting
the result of ballot to the Director general.
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This cooling off period is to allow the Director
general to check the reliability of ballot and
allows the trade union to change their minds.
More importantly, it will allow the Minister of
human Resource to intervene and refer the
matter to the Industrial court for arbitration,
then making the strike illegal. If the decision
is made to refer the case to the Court, the
trade union must be notified of such
reference.
Essential services include;
- Banking services, electricity services, Fire
services, port, harbour and airport services,
postal and telecommunication services,
prison, public health, water, transport,
broadcasting, petroleum and gas services
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Intending strikes must give 21 days notice to
their employer. When an employer receives
such notice, must inform the Directorgeneral about it.
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In the case of public sector, the approval
from the YDPA Agong is essential. The YDPA
can refer the case to the Industrial Court for
arbitration.
1)
2)
3)
4)
5)
Over a collective agreement which has been
accepted by the Industrial Court;
Over managerial prerogatives;
After a trade dispute has been referred to
the Industrial Court for arbitration;
Over a recognition dispute which is being
resolved by the minister;
When the YDPA Agong has refused
permission for a trade dispute in the public
sector to be referred to the Industrial Court
for arbitration.
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The executives of the trade union can be
fined, or imprisonment or both;
The members of union who takes part in the
strike are not eligible to join the trade union
without express permission from the
director-General of the Trade unions.
The union can be de-register.


Lock Out
The employer refuses to allow the workers to
work until the dispute between them is
settled. Sometimes, a lock out is declared in
response to illegal strike by the workers.
The definition of lock-out under section 2 of
the Industrial relations Act;
“lock-out” means—
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(a) the closing of a place of employment; or
(b) the suspension of work; or
(c) the refusal by an employer to continue to employ any
number of workmen employed by him,
in furtherance of a trade dispute, done with a view to
compelling those workmen to accept terms or conditions of
or affecting employment;
The procedure for a lockout are the same as those for a
strike.
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If there are two or more trade unions
registered, which represent the same group
of workers in a trade, occupation, industry,
the Director General has the power to deregister the union which covers a minority of
the workers.
The Director-general also has the powers to
do de-register or cancel the registration of a
union if it was obtained by fraud, if it is being
used for unlawful purposes, or if it does
anything to contravene the Trade Unions Act.
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Collective bargaining is a type of negotiation
used by the employees to work with the employer
or a group of employers. During a bargaining
period, a union of the employees will approach
the employers to negotiate the contact which
both parties can agree with.
For effective bargaining take place, there are two
necessary pre-conditions;
i) workers must have the right to form and join
trade unions.
ii) unions must have bargaining strength.
1.
2.
Be recognized by the employer
Has adequate financial strength, and
members are united.
The Industrial relation Act requires unions to
attain recognition before they can proceed to
invite an employer to commerce collective
bargaining.
1.The union must fill out a Claim for
Recognition Form and presents it to the
employer. A copy of this form must also
forwarded to the Director-General of
Industrial relations.
2.
An employer must reply within 21 days.
The responses;
i) voluntarily recognize
ii) Not recognize.
3. If the employers refuse to recognise, the
Union can report to the Director-General who
will investigate and take whatever means to
settle the dispute. If the employer still refuse
to give recognition, the Director-general will
report this case to the Minister of human
Resources. If more than 50 % of the workers
belong to the union, the Minister will
normally order recognition. The decision is
final and binding on both parties.
Union presents
written demand
At the first bargaining,
union explains and
company makes
counter offer
Agreement is
reached
Agreement over
non-controversial
items
Bargaining over
controversial
issues
Refuse to negotiate
Conciliation
meeting
If no resolution, refer to
Industrial court for arbitration

Must fulfill certain criteria;
a) Must specify the parties to the agreements
b) Must specify the duration of the agreement –
which cannot be less than 3 years,
c) Must include the procedure for modification of
the agreement.
d) must not include the managerial prerogatives
issues such as the promotion, transfer,
recruitment, transfer, termination, assignment
etc.
The agreement is binding on all workers even if
they are not the members of the UNION.