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Written information provided by the Government

The Government has provided the following written information as well as statistics on the number of collective agreements given cognizance.

Observations of the Malaysian Trades Union Congress (MTUC)

The Government keeps its measures in protecting the rights of employees in the country.

The Industrial Relations Act (IRA) 1967 [Act 177] provides protection against acts of anti-union discrimination in respect of their employment through section 8 and section 59 of Act 177. Section 8 provides procedures for non-criminal union-busting cases whereas section 59 deals with semi-criminal cases.

Currently, sections 4, 5 and 7 of Act 177 provide protections of the rights of workers to form, to join and to participate in trade union activities.

In addition, the Government is in the midst of amending the Trade Unions Act, 1959 [Act 262]. Act 262 regulates the operation of trade unions in Malaysia which generally provides for procedures and processes in terms of registration, cancellation and governance of trade unions. The proposed amendment aims to enhance the rights of collective bargaining power of unions in the country by allowing multiplicity of trade unions establishment as well as allow the existence of more than one trade union in one workplace.

The first reading of this bill has been tabled at Parliament on 24 March 2022. The second reading of this act is scheduled to be tabled in the forthcoming Parliament session.

Ongoing legislative reform

The Government has continued to cooperate with the ILO through the Labour Law and Industrial Relations Reform Project in the holistic review process. The development of the labour law amendments are as follows:

(1) The amendment of the Employment Act, 1955 [Act 265] has been approved by Parliament on 20 March 2022 and has been gazetted on 10 May 2022.

(2) Further, on the development of the amendment of the Trade Unions Act, 1959 [Act 262], the first reading of this bill has been tabled at Parliament on 24 March 2022. The second reading of this act is scheduled to be tabled in the forthcoming Parliament session.

Article 1 of the Convention. Adequate protection against anti-union discrimination. Effective remedies and sufficiently dissuasive sanctions.

Detailed information on the general remedies imposed in practice for acts of anti-union discrimination dealt with through sections 5, 8 and 20 of Act 177 are as follows:

(i) Remedies for anti-union discrimination under section 8 and section 20 of Act 177 are awarded by the Industrial Court based on the facts and merits of each case. The Industrial Court will act in accordance with equity, good conscience and the substantial merits of the case without regard to technicalities and legal form for all cases that have been referred by the Director-General of Industrial Relations under section 8, Act 177.

(ii) Further, in the spirit of tripartism and as stipulated in Act 177, victims of anti-union discrimination may file complaints to the Director-General of Industrial Relations in order for the department to inquire or conciliate or investigate the complaints.

(iii) 35 cases were reported from January 2021 until April 2022 under section 8 of Act 177. Out of 35 cases, 31 (88.57 per cent) have been resolved by the Industrial Relations Department and the average duration of the proceedings is three to six months.

(iv) As for the Industrial Court, the case which has been referred by the Director-General of Industrial Relations under section 8 of Act 177 shall be disposed within 12 months based on the Industrial Court Client’s Charter.

Articles 2 and 4. Trade union recognition for purposes of collective bargaining. Criteria and procedure for recognition. Exclusive bargaining agent.

The consultation sessions with stakeholders including the social partners have been done throughout the drafting process for each amendment, including the Trade Unions Act, 1959. As for the process on the amendment of the Trade Union Act, 1959, a total of 72 sessions of engagement, consultation and workshop with social partners have been conducted starting from 2018 to date.

The amendment of the Trade Unions Act, 1959 [Act 262], has undergone the first reading of its bill which has been tabled at Parliament on 24 March 2022. The second reading of this act is scheduled to be tabled in the forthcoming Parliament session.

The Government is of the view that simple majority is a minimum requirement and it shall be maintained in order for a trade union to become an exclusive bargaining agent and the social partners agree with this. Where more than one trade union of workers have been accorded recognition, the exclusive bargaining agent will be determined among themselves or ascertained by the Director-General of Industrial Relations by way of a secret ballot (highest number of votes) as stipulated in the new section 12A of IRA 1967. Section 12A has yet to be enforced and subject to the amendment of the Trade Unions Act, 1959.

In this regard, the amendment of the Trade Unions Act, 1959 [Act 262] has undergone the first reading of its bill, which has been tabled at Parliament on 24 March 2022. The second reading of this act is scheduled to be tabled in the forthcoming Parliament session.

Duration of recognition proceedings

The average duration of the recognition process is four to nine months. The decision on recognition by the Director-General of Industrial Relations may be appealed by the concerned union or employers by way of judicial review.

Migrant workers

Foreign workers are eligible to become members of a trade union and are eligible to hold office upon approval of the Minister if it is in the interest of such union. In addition, Act 177 does not impose restrictions on migrant workers to engage in collective bargaining.

Scope of collective bargaining

The Government maintains its opinion that section 13(3) of Act 177 shall be retained to maintain industrial harmony and in order to speed up the collective bargaining process. Furthermore, the provisions under section 13(3) of Act 177 are not compulsory provisions, since, if both parties agree, they may negotiate the said provisions during the collective bargaining process.

Prior to the current amendment of section 13(3) of Act 177, questions of a general character with regard to promotion only may be raised for matters related to promotion, transfer, recruitment, termination of employment due to redundancy, dismissal and reinstatement and assignment or allocation of duties.

Compulsory arbitration

The amendment on the proviso will be enforced respectively after the amendment of the Trade Unions Act, 1959 [Act 262]. In this regard, the amendment of Act 262 has undergone the first reading of its bill which has been tabled at Parliament on 24 March 2022. The second reading of this act is scheduled to be tabled in the forthcoming Parliament session.

Restrictions on collective bargaining in the public sector

The Government is committed to ensure the welfare of public servants and has recognized collective bargaining at one of the engagement sessions between employers and employees in the public sector. The contents of Service Circular 6/2020 and Service Circular 7/2020 can be accessed through https://docs.jpa.gov.my/docs/pp/2020/pp062020.pdf and https://docs.jpa.gov.my/docs/pp/2020/pp072020.pdf.

Collective bargaining in practice

Statistical information on the number of collective agreements concluded and in force is provided.

Discussion by the Committee

Government representative – In response to the observations raised by this Committee on Malaysia’s compliance with the Convention, please allow me to share some feedback with regard to efforts that have been undertaken by the Government of Malaysia, with the view to progressively fulfilling the requirements under the Convention, thus enhancing Malaysia’s credibility and integrity at international forums.

In this context, Malaysia wishes to take this opportunity to briefly explain the constructive development of labour law reform with reference to the requirements of the Convention. In this respect, Malaysia has successfully amended the Industrial Relations Act, 1967, in December 2020. This important development aims to enhance the existing dispute resolution system, as well as to enable any disputes arising to be resolved effectively, and expedite the procedures involved. In addition, an amendment to the Employment Act, 1955, has been gazetted on 10 May 2022, following which the amendments to the Trade Unions Act, 1959, have been tabled in Parliament in March 2022, with the objective to encourage greater participation of workers to join trade unions. In this regard, the Government of Malaysia would like to take this opportunity to record our appreciation for the technical assistance provided by the ILO via the Labour Law and Industrial Relations Reform project.

Malaysia has made a progressive move to enhance the relevant laws in order to be in line with the Convention. The Government, through the Ministry of Human Resources, has conducted a series of engagements and dialogue sessions with the social partners and the relevant authority to deal with the issues holistically. Further, the Government’s commitment towards labour law reforms shows the continued commitment to deal with all the allegations made particularly with regard to anti-union discrimination and interference in the recognition process. These measures will resolve matters in relation to any cases reported by the Malaysian Trades Union Congress (MTUC). As such, the Government would like to state that observations made by the MTUC previously have been addressed accordingly. Overall, the journey to resolve the cases is not easy. Out of 21 cases reported, 20 cases have been resolved and the outcome of one case is pending at the Industrial Court. Sharing a case in point is the dispute between one of the nation’s largest and most diverse conglomerate companies and the National Union of Transport Equipment and Allied Industries Workers (NUTEAIW); it has been resolved by the decision of the Industrial Court, which was in favour of all the 18 claimants.

In addition, the new amendments provide adequate protection against anti-union discrimination, whereby sections 8 and 20 of the Industrial Relations Act, 1967, provide general remedies for any case of dismissal such as reinstatement, back wages, and compensation in lieu of reinstatement. In relation to this, if there are cases of anti-union discrimination, in the spirit of tripartism and as stipulated in the Industrial Relations Act, 1967, the affected parties may file complaints to the Director-General of Industrial Relations in order for the department to launch inquiries or conciliate or investigate the complaints.

In terms of complaints received by the Department of Industrial Relations, a total of 35 cases were reported between January 2021 and April 2022. Out of 35 cases, 31 cases, which is equal to 88.7 per cent, have been resolved and the average duration of these proceedings is between three to six months. For cases referred to the Industrial Court under section 8 of the Industrial Relations Act, 1967, they will be resolved within 12 months based on the Industrial Court Client’s Charter.

To safeguard against employers’ interference in the recognition process, specific provisions, which are sections 4, 5 and 8 of the Industrial Relations Act, 1967, are applied. In this context, although section 8 of the Act has been amended, the actual impact on the secret balloting process has not been visible due to COVID-19 restrictions. Thus, the Government is of the view that the effectiveness of the amendment should not be a measuring tool at this juncture.

In addition, the Government has also introduced new provisions in advance especially on the sole bargaining rights under section 12A of the Industrial Relations Act, 1967, to enable a trade union the rights of sole bargaining in cases where more than one trade union has been recognized by the employer. However, the new provision will only take effect after the amendment of the Trade Unions Act, 1959, has been completed. The amendment of the Trade Unions Act, 1959, has undergone the first reading of its Bill and is expected to be tabled for the second reading in the forthcoming Parliament session. To the point raised by the Committee of Experts with regard to the situation where no union is declared as the exclusive bargaining agent, a simple majority is needed as a minimum requirement to ensure the process has been completed.

With regard to the point raised by the Committee of Experts on the average duration of the recognition process, 54 per cent of cases were resolved from 2018 to 2019 within four to nine months. However, there are also cases that can be resolved within a month if it involves voluntary recognition. In relation to the amendment of section 9(6) of the Industrial Relations Act, 1967, whereby the provision is deleted, the decision on recognition by the Director-General of Industrial Relations could still be applied through a judicial review request.

With regard to the issue of migrant workers, the Government would like to reiterate that they could be members of a trade union and may hold office subject to appropriate processes and approval by the Ministry of Human Resources. As such, there is no specific restriction under the Industrial Relations Act, 1967, for them to engage in collective bargaining. Based on the statistics provided by the Trade Unions Department, in 2019, a total of 13 unions with a membership of 2,874 members, migrant worker members, were registered. The number has increased in 2021, whereby a total of 7,325 migrant workers are registered as members of a trade union. Today, a total of 27,964 foreign workers are members in 16 registered trade unions.

With regard to the request of the Committee of Experts to consider lifting the broad legislative restrictions on the scope of collective bargaining, the Government maintains its status quo in order to speed up collective bargaining processes and maintain industrial harmony.

The Government took note of the comments by the Committee of Experts on the amendment of section 26(2) of the Industrial Relations Act, 1967.

Further, as for the rights pertaining to collective bargaining by public servants, the Government has always been supportive and has made engagements through various avenues. In this respect, the Public Service Department has provided a platform through the National Joint Council and the Departmental Joint Council in order to ensure that the welfare of public servants is heard and taken care of well.

Last but not least, the Government has always taken important steps to improve and address matters related to labour laws as well as reforms. In this regard, we will continue to be consistent in our support via the existing strategic collaboration between various stakeholders, especially the MTUC and the Malaysian Employers Federation (MEF), in ensuring that the ILO’s requirements with regard to the Convention are met.

Employer members – This case is about the application in law and practice by Malaysia of the Convention. This is a fundamental Convention which Malaysia ratified in 1961. The case is being discussed this year in the Committee for the fifth time, the last occasion being in 2016. It is a case in which the Committee of Experts has made 20 observations since 1989, the last five times being in 2015, 2016, 2017, 2018 and 2021.

The latest consideration of the case follows the complaints launched in 2019 by the MTUC alleging violations of the Convention in practice, including numerous instances of anti-union discrimination, employer interference and violations of the right to collective bargaining in a number of enterprises. The same or similar complaints were previously raised in 2015 by the MTUC and in 2016, 2017 and 2018 by the International Trade Union Federation (ITUC).

The Committee of Experts’ observations relate to the following areas of alleged non-compliance by the Government with the Convention. The first one relates to adequate protection against acts of anti-union discrimination. We recall that Article 1 provides that “workers shall enjoy adequate protection against acts of anti-union discrimination in respect of their employment”.

The Government has indicated that general remedies against acts of anti-union discrimination are dealt with mainly through sections 5, 8 and 20 of the Industrial Relations Act. Cases are referred to the Director-General of Industrial Relations for investigation, inquiry or conciliation, a process which takes an average of three to six months to complete.

Cases referred by the Director-General to the Industrial Court may take up to 12 months to finalize. In addition to the information already submitted by the Government, the Committee of Experts has requested the Government to take measures to ensure that workers who are victims of anti-union discrimination can lodge a complaint directly before the courts in order to access expeditiously adequate compensation and the imposition of sufficiently dissuasive sanctions.

The Committee of Experts also repeated their recommendation for the Government to consider shifting the burden of proof once a worker has made a prima facie case of anti-union discrimination which could be blocking access to appropriate remedies in law.

In this regard, the Employer members invite the Government to continue working with its social partners and, if necessary, with ILO technical assistance to consider measures to improve workers’ access to adequate remedies for acts of anti-union discrimination.

The next observation relates to recognition of trade unions for purposes of collective bargaining. In this regard, we recall that Article 2(1) of the Convention provides that workers’ and employers’ organizations shall enjoy adequate protection against any acts of interference by each other or each other’s agents or members in their establishment, functioning or administration.

Further, Article 4 provides that “measures appropriate to national conditions shall be taken when necessary to encourage and promote the full development and utilization of machinery for voluntary negotiations between employers and employers’ organizations and workers’ organizations with a view to the regulation of terms and conditions of employment by means of collective agreements”.

The Committee of Experts noted the complaints by the MTUC and the ITUC that the process of challenging an employer’s rejection of a voluntary recognition application by a trade union did not provide adequate protection against interference by the employer. The Committee of Experts also repeated its recommendation that, where no single union has emerged as the exclusive bargaining agent, minority unions should be able to negotiate, either individually or jointly, at least on behalf of their members.

We welcome the information by the Government that it has worked with its social partners to make amendments to the legal provisions governing union recognition, including section 12(A) of the Industrial Relations Act, which deals with the determination of a bargaining agent by a secret ballot by the Director-General. We note that section 12(A) will only enter into force upon amendment of the Trade Unions Act, 1959. Accordingly, the Employers encourage the Government to continue working with its social partners to finalize the legal mechanisms that provide safeguards against any interference in the process of trade union recognition and to address the situation of minority unions where no exclusive bargaining agent has emerged. The Government is invited to inform the Committee of Experts of its progress in this regard.

The next observation relates to the duration of recognition proceedings. The Committee of Experts had previously called on the Government to implement administrative and legal measures to expedite the recognition process. According to the Government, changes have been implemented, including amendments to the Industrial Relations Act, to shift powers relating to union recognition from the Minister of Human Resources to the Director-General of Industrial Relations. The Committee of Experts welcomed the changes in law but inquired whether the deletion of section 9(6) of the Industrial Relations Act would render the decision of the Director-General appealable, which might further delay the process. We accordingly invite the Government to consider this matter and provide information to the Committee of Experts by 1 September 2022.

The next observation is in respect of migrant workers, specifically their ability to stand for trade union office. While the Government’s information confirms that migrant workers are not prevented from joining trade unions or standing for office, the information maintains the qualification that it must be approved by the Minister if it is in the interest of such a union. The Committee of Experts has indicated that this situation is not consistent with the Convention and has repeated its call on the Government to take measures, legal and otherwise, to ensure that migrant workers enjoy their full collective bargaining rights. In this regard, the Employers invite the Government to work with the most representative employers’ and workers’ organizations with ILO technical assistance, if required, to align national laws with the Convention.

The next observation is in respect of the scope of collective bargaining, especially as circumscribed by section 13(3) of the Industrial Relations Act. The Committee of Experts had previously expressed its firm hope that this section would be amended in respect of its broad restrictions to collective bargaining, especially with regard to transfer, dismissal and reinstatement, which are matters known as “internal management prerogatives”. According to the Government, section 13(3) was retained in the last round of amendments, except that it has also been amended to now allow trade unions to raise questions of a general character relating to transfers, termination of services due to redundancy, dismissal, reinstatement and assignment or allocation of work.

The Committee of Experts called for information from the Government on the practical implications of the changes, especially the wording about questions of a general character and repeated their recommendation for the Government to lift the broad restrictions on collective bargaining. The Employer members accordingly invite the Government to provide information to the Committee of Experts no later than 1 September 2022. In addition, we advise the Government to continue working with the most representative employers’ and workers’ organizations to address any provisions that restrict the scope of collective bargaining.

The next observation relates to collective bargaining in the public sector. The Committee of Experts noted some of the restrictions on collective bargaining in the public sector, specifically, the exclusion in terms of section 52 of the Industrial Relations Act. We also note the Government’s information that it is committed to protecting the collective bargaining rights of public servants. We also note Service Circular No. 6 and Service Circular No. 7 of 2020 in this regard. We therefore invite the Government to provide information to the Committee of Experts on the working and practice of collective bargaining in the public sector.

A last observation relates to collective bargaining in practice. In the context of low levels of unionization and coverage by collective agreements, the Committee of Experts encouraged the Government to continue providing statistical information on the number of active collective agreements, sectors covered and the number of workers concerned, as well as on any additional measure taken to promote the full development and utilization of collective bargaining under the Convention. We accordingly invite the Government to continue submitting the statistical data on collective bargaining to the Committee of Experts.

We note that Malaysia is receiving ongoing technical assistance from the ILO through the Labour Law and Industrial Relations Reform project, as well as capacity-building on international labour standards for government officials and social partners. We trust their assistance takes into account the national realities and the evolving nature of the world of work, workers’ protection needs and the needs of sustainable enterprises in Malaysia. We also trust that this Committee will be able to see the fruit of these interventions.

Worker members – The Committee is called upon to examine once again the application of the Convention by the Government of Malaysia. During our last review in 2016, the Committee had noted the Government’s indication that it was undertaking a holistic review of its key labour legislation: the Employment Act, 1955, the Trade Unions Act, 1959, and the Industrial Relations Act, 1967.

The Industrial Relations Act was amended in 2019, with effect in January 2021, while amendments to the Employment Act were adopted in 2021, and published in the Official Gazette a few weeks ago, on 10 May. We take note of these changes. However, we remain concerned that the legislative amendments adopted do not adequately address the long-standing issues raised by the unions and by the ILO supervisory bodies and we note with regret that collective bargaining in Malaysia is still subject to statutory restrictions which run counter to the Convention.

Even when workers succeed in establishing and registering a union, which remains a long and arduous process due to the application of the Trade Unions Act – which is still to be amended – they then have to go through the rigid, lengthy and costly legal process of recognition as a bargaining agent.

First of all, applications for recognition as the bargaining agent must be submitted to the employer who has complete discretion to reject them. In that case, the burden then shifts to the union to report the matter to the Director-General within a prescribed time frame or have its application for recognition considered as having been withdrawn.

The Director-General may demand a secret ballot to ascertain the percentage of workers who show support for the union seeking recognition. This procedure which, by the Government’s own admission, still needs to be further reviewed, does not guarantee a fair ballot and does not offer the necessary protections to ensure that employers are unable to gain access to the results. As a matter of fact, it is not the Director-General but rather the employer who decides the time and location of the secret ballot.

For decades, trade unions in Malaysia have raised concerns about this recognition process, which fully rests in the hands of the employers and of the Director-General, allowing undue employer interference throughout the process and depriving workers of representation for the purposes of collective bargaining.

In practice, recognition of the union as the bargaining agent can drag on needlessly for years. Even when a union wins a secret ballot and should therefore be granted collective bargaining status, employers often challenge these results in court, further delaying recognition.

Collective bargaining in Malaysia is further hindered by undue restrictions imposed on the scope of collective bargaining. The current legislation does not allow unions to negotiate general aspects relating to transfers, termination of services due to redundancy, dismissal, reinstatement and assignment or allocation of work, these being so-called “internal management prerogatives”. Amendments introduced to section 13(3) of the Industrial Relations Act, which allow unions to raise questions of a general character, but equally allow the employer to dismiss those questions, fall short of expectations.

To add to this situation, whole categories of workers are denied the right to collective bargaining. In the public sector, unions of public servants are simply consulted and not fully integrated in a process of collective bargaining as mandated by the Convention.

While migrant workers can become trade union members, they can hold trade union office only upon the inappropriate process of approval by the Minister, who will decide on behalf of the union whether it is in the union’s interest for them do so. The Committee of Experts has indicated that this condition hinders the right of trade union organizations to freely choose their representatives for collective bargaining purposes.

Finally, protection against anti-union discriminatory measures is virtually non-existent in Malaysia. Complaint mechanisms before the courts are lengthy and can last well over two years, while any remedies applied are inadequate and usually consist of compensation in lieu of reinstatement. We note in this respect the existing restrictions on the subjects of collective bargaining, especially the aforementioned “internal management prerogatives” which impede unions from raising these issues. In practice, anti-union dismissals and other discriminatory measures are frequent.

The Worker members recall that collective bargaining is a right; together with the right to freedom of association, it enables the exercise of all other rights at work. Without effective and meaningful protection against anti-union discrimination, collective bargaining becomes meaningless. Determining the scope and meaning of the right to collective bargaining under the Convention without its human rights context and the safeguards intended to be afforded to workers when this right is exercised will lead to a race to the bottom regarding terms and conditions of work.

The existing legal framework for the exercise of collective bargaining in Malaysia is deeply flawed and it is no surprise that, in this context, the percentage of workers covered by collective agreements is extremely low, standing between 1 and 2 per cent, while the level of trade union density barely reaches 6 per cent and is declining. The ILO supervisory bodies have repeatedly observed over the years that the Employment Act, the Industrial Relations Act and the Trade Unions Act do not comply with the requirements of the Convention.

In examining the situation, they have regularly emphasized to the Government of Malaysia the importance of adopting measures to facilitate the establishment and growth, on a voluntary basis, of free independent and representative workers’ organizations and their recognition for the purposes of collective bargaining, and the importance of mutual trust and confidence for the development of harmonious labour relations.

Regrettably these calls have not yet been heeded, and the latest amendments introduced fail to address the long-standing issues raised by both the ILO supervisory bodies and the trade unions.

We urge the Government of Malaysia to review and amend the national legislation in consultation with the social partners and in line with the recommendations of the ILO supervisory bodies to bring it into conformity with the Convention.

Worker member, Malaysia – The implementation of the Convention was also examined in this Committee in 2016 and certain concerns raised by the Committee of Experts have not been addressed. We therefore consider the discussion of this case by the Committee as timely and critical.

Several major national labour acts have gone through amendments and are pending implementation. Among them is the Industrial Relations (Amendment) Act, 2020, which came into force on 1 January 2021, and similarly the Employment (Amendment) Act, 2021, which received royal assent on 26 April 2022 and was published in the Official Gazette on 10 May 2022.

Undeniably, the Industrial Relations Act, 1967, does provide some form of protection to the workers and trade unions in Malaysia. However, executive repression and technical and difficult policies and processes prevent workers and trade unions from benefiting even from the minimum protection.

The amendments to the Industrial Relations Act, 1967, move arbitrary ministerial power to the Director-General. The Director-General now decides whether to hold a secret ballot or makes decisions on referring trade disputes to the Industrial Court. Anti-union discrimination and trade union dispute cases are at the discretion of the Director-General. They will not be automatically referred to the Industrial Court, unlike the dismissal cases.

As it is, the Industrial Relations Department must be competent and consistent. In many trade disputes, both parties fail to conciliate. Employers can easily reserve their rights to comply with conciliations or simply refuse to attend the conciliations; even when the employers attend the conciliation, the industrial relations officers merely record statements from both parties, and this is then referred to the Director-General.

Whenever there is an act of intimidation during a secret ballot exercise or unfair dismissal of trade union leaders, the Industrial Relations Department needs to seriously enforce the Act to protect the workers’ right to organize.

Another big challenge of trade unions is to undergo a relatively long and complicated secret ballot process. In section 9 of the Industrial Relations Act, 1967, several processes must be followed and it takes many long years to complete the processes as a suitable date, time and location of the secret ballot are left with the employer. Such a practice is not in conformity with the Convention. Some irresponsible employers refuse recognition and challenge the formation of the union even after a secret ballot victory, right up to the highest court of the land.

We want the entire section 9 – claims for recognition – of the Industrial Relations Act, 1967 to be reviewed and amended to make it easier for any trade union to form a new union. There is a need for a secret ballot; recognition should be automatic and given immediately without being subjected to lengthy processes.

We are also still facing a situation where a claimant whose case is brought to the Industrial Court has to go through a lengthy process to get a decision. There are cases that exceed the period of 24 months to get a decision, and most of the decisions do not provide for reinstatement in work but only for compensation in lieu of reinstatement, including for trade union leaders, although this remedy is foreseen in the Industrial Relations Act, 1967.

The processes in the tribunal have also been made technically difficult for workers. By the same token, we also call on the Government to ensure that the President and Chairpersons of the Industrial Court have broad knowledge of trade unionism, social justice and international labour standards in order to be appointed to the Industrial Court to adjudicate cases, without which workers and trade unions suffer great injustices.

At the same time, a union’s locus standi to represent workers can be challenged judicially in court, which may be time-consuming and extremely costly to the trade union, notwithstanding the deliberate violation of the Convention by the employer. Their intention is usually to frustrate the union and they know very well the union has financial constraints.

Section 13 of the Industrial Relations Act, 1967 prohibits trade unions from including six types of proposal in a collective agreement (in relation to transfer, promotion, dismissal and reinstatement of workers) which are purported to be the company’s “prerogatives”. If such proposals are included, the employer has discretionary power to reject them.

Further, due to the repressive provisions in the Act, trade unions are not allowed to decide the scope of negotiable issues despite having succeeded in the recognition process. For example, workers have repeatedly asked for union security clauses to be included in collective bargaining agreements, but the highest court of Malaysia has decided that such check-off provisions are unenforceable against the employers, as they do not fall under the scope of “trade dispute” as defined in the Industrial Relations Act, 1967.

The amended Industrial Relations Act, 1967, is also denying trade unions from obtaining sole and exclusive bargaining rights. The complexity of the process in the Act will weaken the trade unions’ bargaining power, by exhausting union funds in legal battles and delay collective agreements for the workers. This amendment read with the Trade Unions Act, 1959, will be detrimental to the trade union movement in Malaysia.

There are also cases that are brought up to the Industrial Court to seek clarification and ensure that the employers comply with the agreements. Here, we call on the employers as well as the Government to respect every agreement that has been signed between the employers and trade unions, which must be fully complied with.

We see “union-busting” in Malaysia happening rampantly. This is an absolute denial of access to justice and a fundamental breach of the Convention.

Despite recognition under the Employment Act, 1955, and the Industrial Relations Act, 1967, migrant workers face significant difficulties in exercising their rights to freedom of association and collective bargaining. Migrant workers constantly face threats of dismissal and deportation as they fall under close scrutiny of the police. Unethical employers use dirty tactics and manipulate loopholes in laws and policies to find ways to prevent workers from exercising their right to vote.

In Malaysia, the public sector is continuously denying the right to collective bargaining. We urge the Government to ensure that public servants can bargain collectively in conformity with the Convention and with its Service Circular No. 6/2020 and Service Circular No. 7/2020.

Lastly, workers in Malaysia call for drastic reform to the Employment Act, the Industrial Act, the Industrial Relations Act and the Trade Unions Act to ensure that economic development is aligned with social development, including social protection for all workers. The Malaysian Government must take anti-union discrimination seriously and must cease all forms of anti-union legislation and practices. Legislative amendments must be in the interest of developing and protecting trade union rights in conformity with the Convention.

To conclude, we strongly believe that effective and transparent social dialogue is the way to move forward. This is currently lagging behind in Malaysia. Social dialogue has not been conducted for two years but many labour policies and legislative amendments have been implemented without social dialogue. The Government must hold regular discussions among the tripartite partners within the National Labour Advisory Council in the interests of all, including migrant workers in Malaysia.

Government member, France – I have the honour of speaking on behalf of the European Union (EU) and its Member States. The candidate countries Albania and Montenegro, and the European Free Trade Association country Norway, Member of the European Economic Area, align themselves with this statement.

The EU and its Member States are committed to the promotion, protection, respect and fulfilment of human rights, including labour rights such as the right to organize and collective bargaining.

We actively promote the universal ratification and implementation of fundamental international labour standards, including Convention No. 98. We support the ILO in its key role of developing, promoting and supervising the application of ratified international labour standards and of the fundamental Conventions in particular.

The EU and Malaysia have a close relationship, including through our cooperation in trade and economic issues complemented by our strategic partnership with the Association of Southeast Asian Nations (ASEAN).

While taking account of the information provided by the Government, we note with great concern the apparent tolerance shown by the Government with respect to allegations of anti-union discrimination, employer interference and violations of the right to collective bargaining in a number of enterprises. We echo the Committee’s call for the Government to take the necessary measures to address all of the above allegations, including through rapid investigation and ordering effective remedies for the victims and sufficiently dissuasive sanctions on the perpetrators. We look forward to detailed information in this regard.

We welcome the Government’s engagement with the ILO Office on the legislative reforms of the main labour laws, including by enacting the Industrial Relations (Amendment) Act (IRA) with effect from January 2021 and by revising the Employment Act and the Trade Unions Act. We see this cooperation as vital for achieving full conformity of these laws with the Convention, including in practice.

We reiterate the Committee’s request to the Government to provide detailed information on the amendments to the IRA and their implementation, in order to ensure that workers who are victims of anti-union discrimination can lodge a complaint directly before the courts to obtain the imposition of sufficiently dissuasive sanctions, including the prompt provision of adequate compensation. It is also important to ensure effective protection without placing on victims a burden of proof that could impose obstacles with regard to establishing liability and providing adequate remedies.

Similarly, with regard to the IRA provisions on the criteria, procedure and duration of proceedings on trade union recognition for the purposes of collective bargaining, we call on the Government to ensure, in consultation with the social partners, that the recognition process as a whole provides adequate safeguards to prevent acts of employer interference. We also reiterate the Committee of Experts’ call to the Government to ensure the full inclusion of migrant workers in collective bargaining.

We would also welcome more detailed information on the practical implications of the IRA amendments on the scope of collective bargaining, compulsory arbitration and restrictions on collective bargaining in the public sector, as well as any additional measures taken to promote the full development and utilization of collective bargaining as provided for by the Convention.

The EU and its Member States will continue to follow and analyse the situation and remain committed to their close cooperation and partnership with Malaysia.

Government member, Indonesia – I have the honour to deliver this statement on behalf of ASEAN. ASEAN notes the many efforts and initiatives undertaken by Malaysia towards compliance with the Convention on the right to organize and collective bargaining. In this regard, ASEAN congratulates Malaysia on the recent amendment to the legislation, the Industrial Relations Act, and waits in anticipation for the amendments to the Trade Unions Act to be gazetted and come into effect.

Amendments to legislation are a huge undertaking and will require time to see their effect in implementation. ASEAN is pleased to note that Malaysia has placed much emphasis on its domestic labour law amendment, which is being done in a comprehensive and gradual manner. This is important to ensure its sustainability, particularly in the rapid and dynamic world of work.

ASEAN also encourages Malaysia to continue engagement and consultation with the tripartite constituents in a meaningful manner. The improvements made to the labour dispute resolution system, including expediting some of the required processes, are most welcome in light of the disruption caused by the COVID-19 pandemic.

In addition, the safeguard elements and provisions of remedies in the gazetted Industrial Relations Act can be seen as adequate to address observations and concerns on anti-union discrimination. However, ASEAN recommends Malaysia to continue reviewing the provisions to ensure that the full effect of its implementation is in compliance with the Convention.

ASEAN is pleased to note Malaysia’s close cooperation with the ILO in the amendment process and believes that this will pave the way towards ensuring full compliance with the Convention. ASEAN believes that Malaysia is at its most opportune juncture to continue its good work in protecting and promoting the rights of workers in which ASEAN gives its full support towards the continuous and sustained implementation of the planned activities.

ASEAN would also like to draw attention to the emerging issues and challenges which affect the traditional labour market and industrial harmony and calls upon the ILO to continue working closely with its Member States to ensure the promotion of decent work to all workers.

Worker member, Republic of Korea – In reference to the Convention and concerns raised by the Committee of Experts regarding remedies to anti-union discrimination, trade unions are suffering due to the excessive powers of the Director-General. Under the amended section 8 of the Industrial Relations Act, the Director-General is authorized to forward unresolved complaints to the Industrial Court for remedies.

This relates to Case No. 3401 referred to in the 397th Report of the Committee on Freedom of Association and concerns the complaint against the Government of Malaysia filed by the National Union of Bank Employees (NUBE).

In 2019, the NUBE lodged two complaints against a UK-based multinational bank in Malaysia for intimidating and attempting to injure workers for participating in pickets and campaigns pursuant to trade disputes. The complaint was filed under sections 39(a) and 59(1)(d) of the Industrial Relations Act, 1967, long before the dismissal of the workers.

The ILO Director-General also intervened directly in this case, urging the Malaysian Government to take swift action to stop the intended dismissal of the union representatives. But the Malaysian Government did not heed the ILO Director-General’s intervention or refer the case to the Industrial Court; only the dismissal case of the workers was referred to the Industrial Court.

However, when the bank lodged a complaint against the NUBE for defamation and to stop the NUBE from picketing, campaigning and lodging complaints to the ILO and the OECD, the Director-General very quickly referred the bank’s complaint to the Industrial Court.

He referred the bank’s case even though he is fully aware that the Malaysian Federal Court decided that no court should entertain a case against a trade union pursuant to a trade dispute because trade unions have “immunity” from actions in furtherance to a trade dispute under sections 21 and 22 of the Trade Unions Act, 1959.

It is also important to note that the union has written numerous letters urging the Government to take action against the bank for its anti-union activities but the Government failed to act or respond to the NUBE.

The trade union had filed a suit against the Government for “inaction” which has caused 300 workers’ complaints against the bank to be left unattended.

“Injustice anywhere is a threat to justice everywhere.” The Malaysian Government is an accomplice in union-busting. We call on the Malaysian Government to stop its anti-union practices and undertake to protect workers and trade unions in conformity with the Convention with immediate effect.

Worker member, Japan – I am speaking on behalf of IndustriALL Global Union and the Japanese Trade Union Confederation (JTUC-RENGO). Section 9 of the Industrial Relations Act concerning the secret ballot procedure for trade union recognition was a key concern discussed in this Committee in 2016.

We regret that the amendment of section 9 in 2020 has not brought fundamental changes to safeguard workers from undue interference from employers in the secret ballot procedure. The Government remains reluctant to invoke penal sanctions against employer interference and union-busting practices.

Ten years after the Malaysian Metal Industry Employees’ Union (MIEU), in a German multinational company producing copper wire in Pahang, applied for union recognition, the MIEU is still unable to bargain with the employer. The MIEU submitted a claim for trade union recognition in June 2012; the company immediately disputed the union’s right for representation.

The company also disputed the competence of the union which had been ascertained by the Director of Industrial Relations and Director-General of Trade Unions and moved the case to the High Court. Even though the Court upheld the Director-General’s decision in 2014, the company continued to block each and every step of the proceeding to a secret ballot.

The company reclassified almost all 353 production workers, except 16 of them, under the confidential capacity, in a bid to throw them out from being members of a trade union under section 5 of the Industrial Relations Act. Until the Director-General threatened to file a police report, the company had been blocking the Director-General from visiting the workplace to assess and interview workers.

When the MIEU succeeded in submitting a new claim for recognition in 2019, the company intervened again and supported the registration of an in-house union to undermine the MIEU. The MIEU is still waiting for a secret ballot to take place. This is unacceptable.

Trade union recognition should be simple and automatic after meeting the legal requirements. We urge the Government to continue consultation with the social partners to review section 9 of the Industrial Relations Act, 1967, in order to ensure that workers in Malaysia can meaningfully exercise their rights under the Convention.

Worker member, Switzerland – Our colleagues from the Indonesian Workers’ delegation align themselves with this intervention. The Committee of Experts has rightly again raised the issue of foreign migrant workers’ ability to becoming members and hold office in a trade union. In its latest response, the Government has simply reiterated that foreign workers are eligible to become members of a union and to hold trade union office “upon approval of the Minister if it is in the interest of such union”. This condition in our view hinders the right of trade union organizations to freely choose their representatives for collective bargaining purposes and is thus not in line with the Convention.

Though the law allows migrant workers to join trade unions, there are many cases, such as the example of a multinational tyre manufacturer in Selangor, which excluded migrant workers from Myanmar, India and Nepal from the collective bargaining agreement. A total of 109 migrants could only recover shift allowances, annual bonuses and pay increases worth 5 million Malaysian ringgit based on a court award.

The rights under the Convention are even more remote for migrant workers unable to acquire legal residence status under the very restrictive migration legislation.

It is estimated that in the State of Sabah alone, more than 500,000 migrant workers, mostly from Indonesia, are employed in the palm oil sector. Of these, approximately 70 per cent are undocumented and thus excluded from the possibility of joining a trade union and participating in collective bargaining.

For a long time, only one trade union in the Sabah palm oil sector has been able to organize in only one plantation. One reason for that is that foreigners are not allowed to hold any executive positions in the unions; thus, only Malaysian citizens may act as union organizers. And even though Indonesia and Malaysia share similar vocabularies, most of the migrants only understand basic Sabah–Malay, since many of them still use their mother language based on their ethnic origin.

Another reason is that, according to the Industrial Relations Act, a union is required to prove a majority of membership in a company. The need to organize in almost all estates of one company in different, often very remote, areas at the same time makes the establishment of a new union extremely difficult.

We recognize the efforts of the Malaysian Government and call on it to take all the necessary measures to ensure that all migrant workers can effectively practise their collective bargaining rights and run for trade union office without any restrictions, and to apply the majority requirement at least separately to the different estates of one company in the plantation sector.

Observer, Public Services International (PSI) – The last time we discussed this case, in 2016, this Committee, in its conclusions, requested the Government to: “ensure that public sector workers not engaged in the administration of the State may enjoy their right to collective bargaining”. We will all remember as well that the Government representative said at the time that: “… the Government was currently drafting the amendments and had requested ILO technical assistance so as to facilitate the drafting of the amendments and to ensure that they were in line with the requirements of the Convention …”. However, despite of these promises, barriers for public sector workers still remain in law and practice after six years.

While provisions have been made for municipal workers to bargain collectively, to date, no enabling regulations, for example, have been adopted to realize this right.

The application of compulsory arbitration in essential services under amended section 26(2) of the Industrial Relations Act, First Schedule, are still broad and deprive public servants not engaged in the administration of the State of the right to freely bargain and resort to industrial action.

Also, we raise concerns over the adoption of Service Circulars Nos 6 and 7. First, these circulars were adopted, paradoxically, without consultation and negotiation with relevant unions in the public service. There is – or there was – an established mechanism to discuss the adoption of new service circulars through the National Joint Council, which did not occur. So these circulars have eroded even more the role of workers’ groups in the National Joint Council. Furthermore, these circulars seem to impose new barriers to consultation with public service workers. For instance, union leaders must now receive permission from departmental heads to attend the National Joint Council meetings. While in practice, departmental heads have not restricted attendance to date, the new provisions allow for such restriction.

In addition, Service Circular No. 6/2020 seems to restrict the subject of consultations as well, while Service Circular No. 7/2020 seems to restrict who can be elected to represent the workers in the consultations.

We support the Committee of Experts’ view that workers who deliver public services should be allowed to bargain collectively and that simple consultations do not amount to effective collective bargaining.

Therefore, we expect to see fully-fledged collective bargaining rights for public sector workers in the legislation, in line with the provisions of the Convention.

Government representative – The Government of Malaysia would like to record its appreciation for the views and comments put forward by the Committee and respective social tripartite partners. The views and comments highlighted will help us in further improving and enhancing the application of the Convention in Malaysia. The Government of Malaysia would like to reaffirm that we will continue to take appropriate steps in compliance with the Convention.

In this context, it must be stated that Malaysia has been progressively adhering to the observation made by the Committee of Experts, and we will continue to ensure reforms are done with the support of the employers’ associations and workers’ unions in amending the relevant labour laws to be in line with the Convention. Malaysia takes note of comments raised by representatives from both the Employers’ and Workers’ groups. In this regard, Malaysia would like to put in perspective that the Government of Malaysia believes in constructive engagement between trade unions and employers’ associations, which will ensure that rights are taken care of.

As the process of compliance of standards is subject to many laws in place, Malaysia has always been supportive in amending appropriate laws where needed and we will continue to do so. Among the impacts observed were the amendments with regard to expanding the power of the Director-General of Industrial Relations, and the dispute resolution process has been expedited. Although some of the amendments are in progress, the Government – through consultation, engagement, and townhall sessions – has gathered input from the stakeholders that contribute to the improvement of the process relating to the amendment of labour laws, in particular at this point, the amendments to the Trade Unions Act, 1959.

As for matters raised by representatives through the complaints and disputes lodged in ILO supervisory mechanisms, we take note of the issues raised and we will revert as soon as possible to the ILO. Thus, we value the opinion and views raised by Members.

To address the post-COVID-19 effect on the global economy, the Malaysian economy and the world of work, various initiatives have been implemented using technology platforms. One such initiative with regard to work is the e-Mention to address and expedite matters related to Industrial Court cases. To support all the initiatives, the Decent Work Country Programme (DWCP) was signed in 2019.

The DWCP is jointly developed by the ILO, the Ministry of Human Resources, the Malaysian Employers Federation (MEF) and the Malaysian Trades Union Congress (MTUC) based on the country’s specific priorities. This priority is in line with supporting the Decent Work Agenda through compliance with international labour standards, as well as the country’s commitment to the 2030 Agenda for Sustainable Development, which focus on three areas, namely: rights at work to protect and promote labour rights; future of work to strengthen national capacity in addressing the challenges of the future of work; and labour migration to improve governance of the migration of labour and foreign workers in the country.

In this regard, the Government would like to record its appreciation to the ILO for its continuous support for the labour law reform in Malaysia, especially through the Labour Law and Industrial Relations Reform project.

Last but not least, we would like to reiterate that the Government of Malaysia has made progressive efforts to enhance the procedure and process on the right to strike and collective bargaining. The Government will contribute and engage with the MEF and the MUTC and other stakeholders from time to time in order to uphold industrial harmony in Malaysia.

With those remarks, I wish to conclude my statement by pledging our full and undivided commitment in order to ensure and safeguard the rights and welfare of workers in line with the obligations under the Convention.

Employer members – We wish to thank the various delegates who took the floor and expressed views that enrich the discussion of this case. We have also noted the information made available by the Government in response to the requests and observations by the Committee of Experts and in this meeting today. We note that the ILO is currently providing ongoing technical assistance and capacity-building to officials of the Malaysian Government and social partners. We trust that this will continue.

We invite the Government to continue working with the most representative employers’ and workers’ organizations to bring the national laws into full conformity with the Convention, taking into account the national realities in Malaysia, the evolving world of work, including the needs of workers and sustainable enterprises.

On the question of whether there is a legal obligation for employers to negotiate under Article 4 of the Convention, we have noted that the Committee of Experts seems to believe there is, as long as there is no obligation to conclude a collective agreement. The Employers do not agree with this view, given that Article 4 clearly refers to voluntary negotiation. Similarly, the Employers do not agree with the Committee of Experts that compulsory arbitration at the initiative of a workers’ organization is in line with Article 4, even if it is meant to achieve the conclusion of a first collective agreement. Again, this is based on the facts that Article 4 contemplates on voluntary collective bargaining.

We trust that the Government will keep the Committee of Experts updated on any progress it makes in its efforts to harmonize its laws with the Convention.

Worker members – The Worker members take note of the changes to the Industrial Relations Act and the Employment Act, which recently entered into force in 2021 and 2022. However, we deplore the fact that, despite the introduction of these amendments, challenges concerning the exercise of collective bargaining rights in Malaysia remain unresolved.

We recall that trade unions in Malaysia have been continuously raising these issues for over 40 years. We recall that collective bargaining is a right which, together with the right to freedom of association, enables the exercise of all other rights at work.

The current legal framework in Malaysia constitutes a severe obstacle to their full enjoyment and exercise and therefore must be revised in accordance with the requirements of the Convention.

The Worker members call on the Government of Malaysia to review and amend the national legislation, specifically the Employment Act, the Trade Unions Act and the Industrial Relations Act, in consultation with the social partners and in line with the recommendations of the ILO supervisory bodies to bring it into conformity with the Convention. More specifically, the Government of Malaysia must ensure in law and practice that the procedure for trade union recognition is simplified and that effective protections against employer interference are adopted; that subjects of collective bargaining are not unduly restricted and it is left to the parties to decide on those subjects; that migrant workers can fully participate in collective bargaining, including by enabling them to run for trade union office; that collective bargaining machinery is fully recognized and promoted in the public sector; and that public service unions can bargain collectively and protection against anti-union discrimination is improved through effective and expeditious access to courts, adequate compensation and the imposition of sufficiently dissuasive sanctions.

We call on the Government of Malaysia to accept a direct contacts mission and we invite the Government to avail itself of the technical assistance of the ILO.

Conclusions of the Committee

The Committee took note of the written and oral information provided by the Government and the discussion that followed.

The Committee noted with interest the amendments to the Industrial Relations Act and the Employment Act, which entered into force in 2021 and 2022, respectively. The Committee noted concern at the complaints of ongoing challenges concerning the exercise of collective bargaining rights in Malaysia and the instances of anti-union discrimination and undue interference.

Taking into account the discussion, the Committee requests the Government, in consultation with the social partners, to:

- amend without delay national legislation, specifically the Employment Act, the Trade Unions Act and the Industrial Relations Act, in consultation with the social partners, to bring these laws into conformity with the Convention;

- ensure that the procedure for trade union recognition is simplified and that effective protection against undue interference is adopted;

- ensure that migrant workers can fully participate in collective bargaining, including by enabling them to run for trade union office;

- enable collective bargaining machinery in the public sector to ensure that public sector workers may enjoy their right to collective bargaining;

- ensure, in law and practice, adequate protection against anti-union discrimination, including through effective and expeditious access to courts, adequate compensation and the imposition of sufficiently dissuasive sanctions.

The Committee invites the Government to continue to avail itself of the technical assistance of the ILO.

The Committee requests the Government to submit a report to the Committee of Experts by 1 September 2022 with information on the application of the Convention in law and practice, in consultation with the social partners.

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A Government representative wished to share the various efforts and measures that had been taken by the Government, both internationally and domestically, with a view to minimizing the issues related to the right to organize and collective bargaining, thereby enhancing Malaysia’s credibility and integrity. Regarding the observations made in 2015 by the International Trade Union Confederation (ITUC) and the Malaysian Trades Union Congress (MTUC), he said that the Government was currently amending the Industrial Relations Act 1967 (IRA) and the Trade Unions Act 1959, taking into consideration the comments of the Committee of Experts. Malaysia, as a signatory to the Trans-Pacific Partnership Agreement (TPPA), was embarking on labour law reforms. Out of a total of eight complaints raised by the MTUC, three had been resolved and five were pending before the Industrial Court or the relevant authority. Detailed comments by the Government would be forwarded in writing. The observations made in 2014 by the World Federation of Trade Unions (WFTU) and the National Union of Bank Employees (NUBE) concerned two cases: NUBE v. Hong Leong Bank Bhd and Nur Hasmila Hafni Binti Hashim & 26 others v. Hong Leong Bank Bhd. In both cases, the Industrial Court had dismissed the documents’ claims on the substance. The Court had not yet received any notice for judicial review from the aggrieved parties.

With respect to the holistic review of labour laws, he said that the Government was currently drafting the amendments and had requested ILO technical assistance so as to facilitate the drafting of the amendments and to ensure that they were in line with the requirements of the Convention and the principles of the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87). The length of the process of trade union recognition varied from case to case and depended on the cooperation of the parties. Furthermore, the recognition process could be subject to judicial review. Until the case was finally decided by the courts, the status of recognition could not be finalized. As to the criteria and procedure for recognition, section 9(4B)(b) of the IRA provided that during the recognition process the Director General of Industrial Relations (DGIR) could refer to the Director General of Trade Unions (DGTU) to ascertain the union’s competence. The main criteria for recognition of trade unions were competence and majority support from employees (50 per cent plus one person), to be determined through secret ballot. Details on the formula were provided in Regulation 11 of the Industrial Relations Regulations 2009. Part IXA of the IRA, as amended, granted the power of investigation and prosecution to the DGIR to determine the competency of a union to represent employees in a particular establishment, trade, industry or occupation. The investigation process would only commence after the DGIR had received a recognition claim from a trade union. The DGIR would carry out an investigation to examine the business activities carried out by the company. Among the criteria to determine eligibility were the final product: the raw materials used; the validation by the Companies Commission of Malaysia; the licence issued by the Ministry of International Trade and Industry; the relevant industrial sector; previous cases resolved; and legal court cases. The decision taken by the DGIR in light of the findings and information obtained through the investigation was forwarded to the DGTU for further action.

With respect to migrant workers, he reiterated the commitment of his country as an ILO member State and a State party to the TPPA to adhere to the principles of Convention No. 87. Non-citizens would be able to run for election for union office if they had been legally working in the country for at least three years. That amendment would enable trade unions to elect their representatives freely, especially with regard to representatives of migrant workers. As to the scope of collective bargaining, the Government had agreed, under the Labour Consistency Plan which formed part of the TPPA, to repeal during the upcoming amendment exercise section 13(3) of the IRA, which contained restrictions on collective bargaining with regard to transfer, dismissal and reinstatement. The Government would also look into and discuss the matter of compulsory arbitration, as it had been included in the Labour Consistency Plan. Concerning the restrictions on collective bargaining in the public sector, he said that the process in the public sector was different from the private sector. It was based on meetings or dialogues between workers’ representatives and the management team, the outcomes of which could be used at various levels and brought to the attention of the Prime Minister. The benefits and welfare of public sector workers were far better compared to previous years. In conclusion, he reiterated that the labour law reforms would transform the landscape of industrial relations and labour practices in the country and would hopefully improve national labour laws so as to meet international labour standards, including the Convention.

The Worker members recalled that the application of the Convention by Malaysia had previously been examined by the Committee in 1999. Yet, certain issues of concern raised by the Committee of Experts dated back to 1989 and were still topical. They therefore considered that the discussion of this case by the Committee was timely and critical. The Government had failed to address the major shortcomings in its laws and practices, as well as in its institutional framework, to give effect to the Convention. Regrettably, the deficiencies concerned key issues, including trade union recognition, compulsory arbitration, the scope of collective bargaining, collective bargaining in the public sector, anti-union discrimination and the right of migrant workers to collective bargaining. They noted from the report of the Committee of Experts that the procedure for union recognition took at least three months and that, according to the Government, judicial reviews were conducted within a timespan of at least nine months. However, certain cases had been pending before the Industrial Court for more than three years including the case of a multinational producing copper wire in the metal sector. These time frames were excessive, and were particularly problematic in light of the criteria and procedure under section 9 of the IRA. A union could submit a claim with the DGIR, if an employer rejected its request for voluntary recognition. Unions representing over 50 per cent of the workforce were entitled to participate in collective bargaining. However, the DGIR did not use the total number of participants in the ballot, but instead the total number of workers on the date that union requested recognition. If in this period (of up to three years) the number of workers in the factory had been substantially reduced, the union might lose the recognition, even if it got an overwhelming majority of the votes. The criteria and procedure were therefore open to abuse by certain employers, who sought to delay and prevent good faith collective bargaining. The Government had also repeatedly refused to comply with the request by the Committee of Experts to amend section 26(2) of the IRA, which provided that the Minister of Labour could refer a dispute to the Industrial Court for arbitration, even without the consent of the bargaining parties, in clear violation of Article 4. The Committee of Experts had also made repeated requests for the repeal of legislative texts imposing restrictions on the scope of collective bargaining, and specifically section 13(3) of the IRA, which contained restrictions on collective bargaining with regard to transfer, dismissal and reinstatement, which were essential terms and conditions of employment. Workers in the public sector were excluded from the right to collective bargaining, with consultations about working conditions taking place in the National Joint Council and the Joint Agency Council. The Committee of Experts had repeatedly urged the Government to allow public servants to bargain collectively over wages, remuneration and other working conditions.

The Worker members also expressed serious concerns over various discriminatory tactics used by certain employers against workers engaged in union activities, and the lack of remedies and dissuasive sanctions. Examples were numerous. Union officials in the railway industry had been subject to disciplinary actions for conducting a picket; ten workers in the rubber production industry had been dismissed for participating in a picket; a union leader employed in a waste collection company had been dismissed for sending out circulars to union members, and the Industrial Court had not ordered his reinstatement, despite the recognition by the court that he had acted as a union official in accordance with the law and the president of a union that sought recognition for collective bargaining purposes in a cement company had been transferred to another branch and then dismissed for allegedly making slanderous comments about management. The Committee of Experts had also raised concerns that migrant workers could only be elected as trade union representatives with the permission of the Minister of Human Resources pursuant to section 28(1)(a) and section 29(2) of the Trade Union Act. They observed that the practical obstacles to collective bargaining faced by migrants went much further. Migrant workers were likely to be subject to dismissal and non-renewal of residence permits if they joined a union or engaged in union activities, as had already happened in the electronics sector. In a case in the paper industry, the Industrial Court had ruled that migrant workers working under a fixed-term contract could not benefit from the conditions agreed in collective agreements. The Worker members wished to draw to the attention of the Committee the fact that the MTUC could not engage in collective bargaining, which meant that there was no collective bargaining at national level. According to the principle of free and voluntary collective bargaining embodied in Article 4, the determination of the bargaining level was essentially a matter to be left to the discretion of the parties. They welcomed the Government’s statement that it was currently undertaking a holistic review of its principal labour laws and emphasized the importance of social dialogue in the context of this review. They hoped that the Government would take into account the comments provided by the MTUC, which contained a detailed review of the legislation, taking into account the comments provided by the ILO supervisory mechanisms.

The Employer members noted that the case had been examined by the Committee in 1994 and 1999. Since then, the Committee of Experts had made nine observations on it, mostly dealing with Article 4 of the Convention. As the Government was conducting a holistic review of its labour laws, they considered that the observation of the Committee of Experts was a “laundry list” of issues with the current legislation in the hope that any new legislation would conform to such views. They therefore considered that it was not the right time to examine the case of Malaysia and would have preferred to do so after the long list of revisions had been made by the Government, which had welcomed the ILO’s assistance. As the situation stood, five main issues were at stake.

First, regarding recognition, the law provided for a secret ballot if an employer did not voluntarily recognize a trade union. Prior observations of the Committee of Experts concerning the duration of the recognition process mentioned that it took nine months on average, but the Government had stated that the duration was only three to four-and-a-half months. While the Committee of Experts believed it was still too long, the Employer members considered that this was shorter and that Article 4 said nothing about the duration of the recognition process. In addition, regarding the ballot, a majority of 50 per cent of workers on the date that the union sought recognition was required, whereas the Committee of Experts considered that it should be 50 per cent of actual voters. Again, Article 4 did not provide any details on the ballot process. Such matters were inappropriate for a binding Convention. Second, the law potentially restricted migrant workers from holding union office, although it did not establish a blanket ban on migrant workers, but only required permission from the Minister of Human Resources. In the view of the Employer members, Article 4 did not deal with the question, which moreover appeared to be a sovereign right consistent with the term used in Article 4 “measures appropriate to national conditions”. The Government had stated that it planned to amend the national legislation in this regard, and the Employer members welcomed that initiative. The third issue concerned management rights, including promotion, transfer, employment, termination, dismissal and reinstatement. In the past, there had been discussions in the Conference Committee on the matters that could be subject to collective bargaining. Determining matters that could be the subject of collective bargaining should be the right of a member State. The Convention did not enumerate matters that were not subject to collective bargaining. Any such detail should be part of a non-binding recommendation, not a Convention. Detailing matters in that way contradicted the voluntary character of collective bargaining and was not appropriate for an observation. While noting the Government’s intention to change the law, the Employer members considered that the existing provision was not contrary to Article 4 of the Convention. The fourth issue concerned restrictions on the right to collective bargaining for public servants other than those engaged in the administration of the State. The Government had noted that committees existed to discuss working conditions with the State. It would however be useful to receive precise information on the bargaining that had taken place, the number of those committees and the nature and number of the collective agreements that had been concluded. Finally, regarding compulsory arbitration if collective bargaining failed, the law allowed either social partner to request such arbitration and the Minister of Labour to refer the parties to arbitration. They raised the question as to why the Committee of Experts had only taken issue with the latter. In conclusion, the Employer members did not consider that the case was about the failure of collective bargaining, but mostly about the Committee of Experts expressing detailed views on a broadly worded provision.

The Worker member of Malaysia said that, while the enactment of the IRA upon ratification of the Convention had been laudable, collective bargaining was subject to statutory restrictions which ran counter to the Convention. When workers succeeded in establishing and registering a union, they still had to go through the rigid, agonizing and costly legal process of recognition under section 9. Related to this was the competency check of trade unions by a third party, as well as the secret ballot to determine whether a union represented the majority of workers. A union’s locus standi to represent the workers could also be challenged by judicial process, which was time consuming and extremely costly for trade unions. Even if trade unions succeeded in the recognition process, they could not determine the scope of negotiable issues due to the restrictive provisions in the Act. Union security clauses were prohibited from being included in collective agreements, and the highest court in Malaysia had held that the check-off provisions contained in collective agreements were no longer enforceable against employers because they were not a trade dispute, as defined in the Act. He welcomed the Government’s assurance that section 13(3) of the IRA would be amended at the next sitting of Parliament. For over 40 years, the trade union movement had raised this issue, which prevented proposals for collective agreements to include provisions that were purported to be management prerogatives.

Malaysian workers also faced other impediments such as: (i) Industrial Court presidents and judges who refused to acknowledge international labour standards; (ii) the lengthy adjudication process; (iii) the equity and good conscience of the Industrial Court’s being subject to legal technicalities; (iv) no order of reinstatement for workers wrongfully dismissed, including trade union leaders, despite the remedy provided for in the Act; (v) compensation in lieu of reinstatement restricted to 24 months and reduced by the court; (vi) unlawfulness of pickets when disputes were referred to the Industrial Court; and (vii) no real right to strike in practice, although it was provided for by law. Although the Employment Act and the IRA granted migrant workers the right to collective bargaining, they were excluded from joining a trade union and faced threats of dismissal and deportation. There were no sanctions, penalties or measures applied to errant employers. That allowed for widespread and extensive victimization of workers, including the dismissal of union members and leaders for upholding their rights, as well as attacks on unions, such as applying to the courts to de-register unions or suing them for defamation. In a recent award, the Industrial Court had concluded that the company had violated the protection accorded to trade union leaders and members, but had not imposed a penalty. Another example was the victimization and dismissal of 27 clerical workers of a bank who had appealed against their transfer, followed by the bank’s injunction to stop the union from picketing and its application to de-register the union and, after one year, the court’s dismissal of the application, which was currently being challenged. Since 2014, relations between the social partners in the country had improved under the leadership of the Secretary-General of the Ministry of Human Resources and workers’ issues would hopefully be addressed soon for the benefit of all stakeholders. He acknowledged the Government’s decision to take a holistic review of the labour laws further to the TPPA Labour Chapter, but emphasized that the labour legislation should comply with international labour standards. Finally, he urged the Government to immediately engage with the ILO High-level Mission to address the backlog of cases, so as to clear all pending issues, and to work on the holistic review of the labour and other legislation contravening ILO Conventions. The provisions for trade union recognition should be simplified and it should be mandatory for employers to give due recognition. Government organs should give effect to ILO Conventions and employers acting contrary to the Convention and to the principles of bargaining should be penalized. He hoped that the Employer member of Malaysia would be a responsible social partner and promote meaningful collective bargaining so as to enable the Government to comply with the Convention.

The Employer member of Malaysia said that, with regard to allegations of anti-union discrimination and interference in several sectors, including dismissals and non-recognition of unions, raised by the ITUC and the MTUC, disciplinary action had been taken by employers after due inquiry arising from employment misconduct committed by employees and could not be categorized as anti-union discrimination. On the issue of recognition claims filed by unions, the fact remained that the union needed to go through the process of claiming recognition before it could be recognized by the employer. In the event that the union failed to fulfil the criteria required for recognition, the employer was given discretion to recognize the union or not to do so. Furthermore, the issues raised by the WFTU and the NUBE on two cases pending before the Industrial Court were premature and should not be entertained as the matters raised were currently pending before the Industrial Court. The claims filed in the two cases had since then been dismissed and the aggrieved parties had decided to file applications for judicial review to the High Court. Referring to the issue of the holistic review of labour laws, he confirmed that the Government had actively carried out consultations with the stakeholders to review existing labour legislation. The labour law review should be carried out after getting the views and inputs from the relevant stakeholders, which required time. He considered that labour legislation should facilitate rather than hinder the growth of businesses. With regard to the observations that the duration of proceedings for claiming recognition were still excessively long, he said that the length of time taken to handle trade union recognition depended on the complexity of each case. The recognition claim could also be subjected to judicial review up to the highest level of the judicial system, which would delay the process further. The case would still be pending until a final decision by the highest court, it would not therefore be possible for the Government to impose a fixed period of time for recognition claims to be resolved. With reference to the criteria and procedures for assessing the competency of a trade union for the purposes of recognition, he was of the view that it was appropriate to consider those in employment at the date when the claim for recognition was submitted to the company, and not a future percentage of union membership, which would be unfair. Regarding the scope of collective bargaining, the restrictions under section 13(3) of the IRA were not absolute and were not a hindrance to effective collective bargaining, as many collective agreements covered the matters set out in section 13(3), such as transfer, retrenchment and promotion. He was surprised by the position taken by the Committee of Experts on the issue of compulsory arbitration and noted that the existing system in Malaysia ensured harmonious industrial relations, considering that where both parties could not resolve the dispute it was only appropriate that the matter be subject to arbitration. Referring to collective bargaining in the public sector, he emphasized that, despite the comments made by the Committee of Experts, wages and terms and conditions in service of the public sector were generally better when compared with those in the private sector, and he believed that content was more important than form.

The Government member of Cambodia, speaking on behalf of the member States of the Association of Southeast Asian Nations (ASEAN), as well as Bahrain, Bangladesh and China, acknowledged the observations made by the Committee of Experts and welcomed the commitment and efforts of the Government of Malaysia to ensure that its labour legislation was in line with the requirements of the Convention. Further noting that the country was conducting a major holistic review of its main labour laws – the Employment Act 1955, the Trade Union Act 1959 and the Industrial Relations Act 1967, he urged the Committee to grant ample time to Malaysia to conduct such a substantial exercise.

The Government member of Qatar welcomed the Government’s efforts as part of the holistic review of its main labour laws and emphasized that the Office should provide technical assistance to support those efforts.

The Worker member of Italy considered that in Malaysia there was an unacceptable situation of discrimination and exploitation towards migrant workers. Although it was possible for a migrant worker to join an existing union, section 28(a) of the Trade Union Act required that union officers be citizens of Malaysia, thus disqualifying migrant workers from serving as union leaders. The Committee of Experts had already in the past observed that such a requirement hindered the right of trade unions to choose their representatives for collective bargaining freely, and she raised the question of what concrete action had been taken by the Government in this regard. In addition, the conditions set out by the Ministry of Home Affairs (MHA) for issuing work permits to migrant workers included an absolute prohibition on these workers from joining any sort of association. Employers had interpreted this to mean that migrant workers were forbidden to join trade unions, and the MHA had declined repeated appeals by the MTUC to take a stand on this interpretation by employers. In addition, employers had included these restrictions in the contracts of migrant workers, in contradiction with the legal guarantees of freedom of association, notably section 8 of the Employment Act of 1955, and the MHA had taken no steps to prevent this. Violation of the terms of a contract was an offence that could be punished with termination, which in turn led to the revocation of the migrant’s work permit and the initiation of deportation proceedings. Employers also held the passports of migrant workers, making them vulnerable to detention by the police immediately until their identities could be verified with their employers. This situation represented a real obstacle to the implementation of the Convention in Malaysia, since the country had the fourth largest number of migrants in East Asia and the Pacific. She therefore called on the Government to act urgently in order to ensure that discriminatory rules and practices were removed and the legislation brought into line with ILO Conventions.

The Worker member of Canada, also speaking on behalf of the Worker member of the United States, indicated that national labour law remained non-compliant in almost every aspect of the Convention. The Committee of Experts had noted non-compliance concerning compulsory arbitration, dismissal, non-recognition of unions and unfair labour practices. The right to organize and collective bargaining were regularly violated and collective bargaining was restricted in companies and the public sector. Section 13(3) of the IRA provided for unfair restrictions against the freedom to bargain collectively and should be repealed with immediate effect, as it excluded from the negotiable issues that could be discussed at the bargaining table, the promotion, transfer, dismissal and reinstatement of workers, as well as assignment of duties and termination by reason of redundancy or reorganization. While recognizing the efforts made by the Government to conduct a holistic review of its main labour laws, she acknowledged that the driver of the reform was membership of the TPPA, the 12-country free trade agreement that included Canada and the United States. Despite the characterization of the TPPA as a “gold standard” by those who promoted it, its Labour Chapter and the Malaysia consistency plan proposed by the Government of the United States offered watered-down and partial measures that invoked the spirit of ILO Conventions, rather than their full content. The TPPA could have provided an impetus and some ideas for Malaysia to pursue badly needed reforms to comply with the Convention, but meeting goals set by the TPPA would not produce compliance. She concluded by expressing concern that the existence of trade agreements such as the TPPA which referred to the 1998 Declaration on Fundamental Principles and Rights at Work, but did not require compliance with fundamental Conventions, had opened the door to countries looking to be associated with the spirit of ILO Conventions, but not with their full content.

The Worker member of Japan recalled that various violations of the Convention by the Government had been continuously examined by the Committee on Freedom of Association and the Committee of Experts since the early 1970s and late 1980s, respectively. Malaysia had achieved rapid economic growth in the past decades, and the country should now take a high road towards improving its labour and employment policies. Recalling that Japan was a signatory to the TPPA, he indicated that, in the course of a parliamentary hearing in Japan related to the Labour Chapter of the TPPA, non-recognition and anti-union discrimination in Malaysia had been considered as the most serious cases where the principles of the 1998 Declaration on Fundamental Principles and Rights at Work were not respected. He emphasized that, if the Government of Malaysia was looking for further expansion of its trade and investment into the country, it should review the main labour laws that had been barriers to adequate protection of trade union rights.

The Worker member of France referred to two archetypal cases concerning violations of the right to collective bargaining. The first concerned the Hong Leong Bank and the NUBE union. In 2013, the bank had decided to centralize part of its activities, thereby imposing forced mobility on 49 workers who were members of the union, which had made their family life difficult. The workers affected by this measure had immediately protested, expressing their disagreement by means of pickets and subsequently calling for conciliation at the ministerial level, but the management of the bank had refused to reach a compromise, and the 27 workers refusing transfer had been dismissed. The bank had then initiated legal proceedings with the Supreme Court in order to obtain an injunction against the union to stop it picketing the bank’s premises and to have the trade union removed from the register, which was contrary to Articles 1 and 2 of the Convention. The second case had been running for 26 years and involved Sabah Forest Industries (SFI) and the Sabah Timber Industry Employees Union (STIEU). Attempts to register the union in 2003 and 2010 had failed. Nonetheless, in 2010, the results of a secret ballot held following a request for recognition had revealed that 85.9 per cent of staff at SFI supported the STIEU. The need for a union presence had sadly been felt after the death of a worker in the wood and pulp factory because of inadequate safety measures. At the end of 2015, the STIEU had still not been recognized. Disputes of this sort were on the increase and affected all sectors. Time and again, the same methods cropped up: lack of consultation with the trade unions; unilateral decision-making; anti-union harassment and discrimination; recourse to the highest courts; dismissed trade unionists who were simply seeking to exercise their rights peacefully; and delays in registration, which showed how difficult it was to ensure that the principles of collective bargaining were applied in Malaysia.

An observer representing the World Federation of Trade Unions (WFTU) said that, of the 24 cases selected this year, five related to Convention No. 98, or 20.8 per cent, which gave a clear idea of the situation of freedom of association and collective bargaining in a number of countries. What was happening in Malaysia and Tunisia and in other countries reflected the attitude of governments in penalizing trade union movements, discriminating against them and preventing them from enjoying their right to collective bargaining. In Tunisia, for example, the Government refused to recognize certain trade union organizations that operated outside the unionist majority in both the public and private sectors. It was important for the ILO to impose compliance with the fundamental Conventions in order to promote social justice.

The Worker member of Indonesia regretted that the Government still did not have a concrete proposal to guarantee the right to collective bargaining of public servants so as to comply with the Convention. The Government had referred to the specific characteristics of the public administration to justify the exclusion of public servants from collective bargaining. However, it was precisely the absence of the right to collective bargaining in a country that had ratified the Convention which rendered “peculiar” the situation of public servants in Malaysia. He requested the Government to respect the commitments made when ratifying the Convention and to give effect to the recommendations of the supervisory bodies of the ILO. Being part of an organization such as the ILO and pledging to abide by its rules was an act of responsibility, significance and commitment. He called on the Government of Malaysia to live up to the values and honour the commitments it had freely chosen to assume.

The Government member of India thanked the Government of Malaysia for the comprehensive reply that it had provided on all matters, including the allegations made by the ITUC and the MTUC. He recognized that three out of eight MTUC complaints had already been settled and the detailed updates on the remaining cases were expected. The IRA and the Trade Unions Act were being amended in the context of a holistic review of labour laws. Under the Labour Consistency Plan, the Government had agreed to: repeal section 13(3) of the IRA, which contained restrictions on collective bargaining with regard to transfer, dismissal and reinstatement; eventually allow migrant workers to run for election to trade union office; and address the issues of compulsory arbitration and the scope of collective bargaining. The Government had requested ILO assistance to ensure that these legislative amendments were in line with Conventions Nos 87 and 98, thereby demonstrating its commitment to international labour standards. India supported Malaysia in its efforts to reform labour legislation and requested the Committee to fully take into account the detailed information provided by the Government and its continued commitment to strengthening the compliance of its labour laws with the Convention.

The Government member of Bangladesh considered that the Committee should recognize the significant progress made by the Government in addressing the outstanding issues. He welcomed the Government’s legislative initiatives, in particular those aimed at amending the laws dealing with industrial relations and trade union activities, and encouraged the ILO to provide technical assistance to Malaysia in this regard.

The Government representative emphasized that, where trade unions and employers’ organizations existed at the national level, as was the case in the plantation, banking and insurance sectors, collective bargaining took place. The allegation that workers were not free to establish trade unions was not substantiated. He emphasized that the presidents of the Industrial Court were free from any external influence or pressure when making awards, and that there were therefore no privileges given to union leaders when the cases were adjudicated. With respect to the cases involving the dismissal of employees of the Hong Leong Bank, he explained that in 2013 the bank had decided to centralize its credit processing standards located across the country into three main regions in Peninsular Malaysia and that 27 employees who had refused to comply with the transfer order were dismissed following due inquiry. He said that the bank’s prerogative to transfer employees was part of the letter of appointment, as well as the collective agreement, and it was therefore issue of misconduct by employees and not an act of union victimization. In conclusion, he referred to the following benefits enjoyed by public sector employees achieved through negotiations between trade unions and management: security tenure, guaranteed annual increment, pension schemes, lump sum gratuity upon retirement, free health care, government quarters, fully paid maternity leave, low interest rate for certain loans, higher minimum wage compared to the private sector, annual leave of 35 days and other cash payments.

The Employer members recalled that this case had last been examined by the Committee in 1999. Nothing had changed since then and there was nothing to supervise, and thus discuss, until the holistic legislative reform announced by the Government was completed. Indeed, the Committee of Experts had duly noted the information provided by the Government to the effect that in the last two years no cases had been reported of employers opposing the directives of the authorities granting trade union recognition, except in cases where the employer had obtained a stay from court due to judicial review, or regarding employers refusing to comply with Industrial Court orders to reinstate unlawfully dismissed workers. They requested the Government to provide detailed information on the collective bargaining rights of public servants not engaged in the administration of the State and on the outcome of the holistic legislative review, once it had been completed.

The Worker members, while welcoming the Government’s commitment to provide details on the ongoing legislative review, considered that the challenges concerning the exercise of collective bargaining rights in Malaysia were enormous and a cause of concern. The Worker members, in response to the Employer members, noted that in order to assess compliance of the laws and practices in Malaysia with the principles of Article 4 of the Convention, it was unavoidable to look at the specifics and the details of those laws and practices, as the Committee of Experts had done in accordance with its mandate. They expressed the view that it was precisely those details of the laws and their implementation that hindered compliance with those principles and the promotion of collective bargaining in Malaysia. They believed that the Government had not taken adequate measures to encourage and promote voluntary negotiations between workers and employers to regulate terms and conditions of employment by means of collective bargaining. The percentage of workers in Malaysia covered by collective agreements was extremely low. Despite a unionization rate of almost 10 per cent, only 1–2 per cent of workers were covered by collective agreements. The right to collective bargaining was an essential element of freedom of association, as it was key to the representation of collective interests. Collective representation was only meaningful if workers could negotiate and improve their conditions. The Worker members urged the Government to bring its law and practice into line with the Convention, in consultation with the social partners. A conducive framework for collective bargaining required an efficient process for the recognition of trade unions for collective bargaining purposes. It was crucial to simplify and speed up the procedure for claims submitted by the unions to the Industrial Relations Department seeking recognition. This was necessary in order to ensure that the recognition of representative unions by employers was mandatory. It was also important to discourage employers from abusing lengthy recognition procedures as a means of protracting negotiations. The Worker members hoped that the criteria for determining the representativity of trade unions for collective bargaining would be reformed so as to ensure a genuinely democratic process. A trade union which could obtain the support of the majority of workers who cast a vote should be entitled to bargain on behalf of those workers. The holistic review of labour laws that was currently being undertaken should also include the repeal of sections 13(3) and 26(2) of the IRA which, respectively, limited the scope of collective bargaining and allowed compulsory arbitration without the agreement of the bargaining partners. Furthermore, section 27(a) of the Trade Unions Act should be amended to allow workers in the public sector to unionize and engage in collective bargaining. The number of workers, and trade union officials who had suffered from anti-union discrimination and the lack of remedies against such acts were shocking and unacceptable. The Government should immediately take legal and practical measures to ensure that remedies and penalties against acts of anti-union discrimination were effectively enforced and all outstanding legal cases be settled. The Worker members emphasized that there were over 2 million migrant workers in Malaysia. This number would rise dramatically, as the Government had just signed a Memorandum of Understanding with Bangladesh to bring 1.5 million workers into the country within the next three years. In practice, migrant workers were currently excluded from collective bargaining as the employment contracts of migrant workers had typically a duration of two years, the Worker members remained concerned that, even after reforms had been undertaken, most migrant workers would be excluded from the right to be elected as union officials. The Government should therefore explicitly grant migrant workers the full right to join unions and to engage in collective bargaining and ensure that all of its institutions respected and enforced this right, particularly the Industrial Court. The Worker members hoped that the Government would take guidance from the discussion in the Committee. They called for a direct contacts mission to visit the country and requested the Government to avail itself of ILO technical assistance.

Conclusions

The Committee took note of the information provided by the Government representative and the discussion that followed on issues raised by the Committee of Experts.

The Committee noted with interest the Government’s indication that it is undertaking a holistic review of its key labour legislation – the Employment Act 1955, the Trade Unions Act 1959 and the Industrial Relations Act 1967 (IRA).

Taking into account the discussion of the case, the Committee requested the Government to:

• - Provide further detailed information regarding the announced repeal of section 13(3) of the IRA on the limitations with respect to the scope of collective bargaining.
• - Report in detail on the holistic review of the national labour legislation described above to the next meeting of the Committee of Experts in November 2016.
• - Ensure that public sector workers not engaged in the administration of the State may enjoy their right to collective bargaining;
• - Provide detailed information on the scope of bargaining in the public sector.
• - Review section 9 of the IRA in order to guarantee that the criteria and procedure for union recognition are brought in line with the Convention.
• - Undertake legal and practical measures to ensure that remedies and penalties against acts of anti-union discrimination are effectively enforced.
• - Ensure that migrant workers are able to engage in collective bargaining in practice.

The Committee calls upon the Government of Malaysia to avail itself of ILO technical assistance with a view to implementing these recommendations and ensuring that its law and practice are in compliance with Convention No. 98.

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A Government representative broke down the Committee's concerns regarding the Government of Malaysia's implementation of Convention No. 98 into three issues. First, section 15 of the Industrial Relations Act of 1967 relating to collective agreements for companies granted "pioneer status". Second, section 13 of the same Act concerning restrictions with regard to certain matters on collective bargaining. Third, the right of government employees to bargain collectively under section 15 of the same Act.

Regarding the first issue, the Government informed the Committee that the provision in question was in the process of being repealed. However, as the repeal process formed part of a general amendment to the Industrial Relations Act, the amendment to this section had inadvertently been delayed in order to accommodate amendments to various other provisions which were being incorporated. The Government was fully aware that the relevant provision had outlived its purpose and had taken appropriate measures to repeal it in the near future. The Government also undertook to forward a copy of this legislation to the Office as soon as it was enacted by Parliament.

In respect of the second issue, the Government took note of the Committee's comments that employment, promotion and termination should be matters for management's decision-making and form part of management's freedom to run the enterprise. The Government also took note of the Committee's view that transfer, dismissal and reinstatement should not be excluded from the scope of collective bargaining. In this regard, the Government reiterated its position that these three matters should not be predetermined in a collective agreement. In its view, if such issues were predetermined in a collective agreement, this would ultimately affect the rights of management to manage its business efficiently. However, while these issues were excluded from collective bargaining this did not grant unfettered rights to employers in this respect, as shown by the numerous relevant decisions issued by the Malaysian courts. Despite this restriction, issues related to those matters had been the subject of frequent negotiations, consultations and agreements between unions and management whenever the need arose, as the Malaysian labour laws did not prohibit such negotiations.

With reference to the third issue of the restriction of public services from collective bargaining, the Government reiterated that the Congress of Unions of Employees in the Public and Civil Services (CUEPACS) and the Public Services Department (PSD) had met on a regular basis through various joint councils. In their discussions, they deliberated and negotiated remuneration packages, terms and conditions of employment and the resolutions of anomalies. While macro-level issues such as salaries, pension increases and general allowances were raised through CUEPACS, which was the central body of the public services union, other issues, specific to certain services or agencies, were taken up by the individual trade unions with the agencies concerned, either through the departmental joint councils or directly with the PSD. Presently, there were about 300 trade unions in the public service representing employees from various services, categories and agencies. Once negotiations were concluded, circulars were issued to the relevant agencies for implementation of the agreements.

Due to the differing objectives between the public sector and the private sector, and the Government being a single employer of more than 850,000 employees, it was not possible to have collective bargaining and collective agreements with each of the trade unions. The Government had to take into account equity and uniformity of salaries and terms of conditions of employment for all its employees. At the same time, the Government had to bear in mind the economic situation, the financial possibilities and the services needed to be provided to all its citizens in determining remuneration and other benefits for its own employees. In Malaysia, the mechanisms for consultation and negotiation for government employees were not limited to CUEPACS and the PSD or the individual unions of the various agencies. Rather, unions had access to the highest authority, the Prime Minister. To date, the mechanisms available had provided sufficient avenues for discussions and negotiations on salaries and terms and conditions of employment for public employees and had been successful in ensuring the protection and enhancement of the interests and the welfare of public sector employees. As an example, in early 1997, five trade unions representing employees from five government agencies submitted proposals and claims for salary adjustments to the Government. Unfortunately, due to the economic decline which began in mid-1997, discussions on the proposals were temporarily set aside. However, serious discussions resumed six months ago between these five unions and the Government. Only a few days ago, the Prime Minister announced the Government's approval for, among other things, salary adjustments for the five agencies, which would benefit nearly 11,000 employees, especially those in the lower income groups. Prior to this, a new circular had also been issued, which provided a certain group of employees with a special duty allowance. CUEPACS had played an important role in assisting the five unions throughout these negotiations.

It had always been the policy of the Malaysian Government to ensure that equity prevailed among all citizens, especially on social and economic levels. Enhancement of quality of life of the people could only be realized through economic development. It was therefore essential that the laws, policies and practices provide a balance between worker protection and enterprise development to ensure stability, harmony and a conducive climate for development. She indicated that the Workers' delegate from Malaysia representing CUEPACS would be in a position to affirm the Government representative's statement.

The Employer members stated that this case had been examined previously in 1994 at the Conference Committee. The case was related to collective bargaining issues, particularly with regard to Article 4 of the Convention, which were of a more promotional character. In this respect, three questions had been raised by the Committee of Experts in its report. The first question concerned section 15 of the Industrial Relations Act (IRA) which had limited the scope of collective agreements for companies granted "pioneer status". The Employer members stated that the Government representative had already promised in 1994 that this provision of the Industrial Relations Act would be amended. However, there had been some delay in the legislative process, with the result that the Bill had only been submitted to Parliament for examination recently. In this regard, the Employer members thought that the Government should provide some information as to the content of the Bill already at this stage of the legislative process. Another issue concerned section 13(3)(c) of the IRA with regard to matters known as internal management prerogatives, such as promotion, transfer, employment, termination, dismissal and reinstatement. The Employer members recalled that there was agreement as to the State's right to determine matters which could not be subject to collective bargaining, since such matters would ultimately affect the rights of management to manage. Indeed, the Convention had not enumerated matters which were not subject to collective bargaining. Such detailed provisions would constitute a contradiction to the voluntary character of collective bargaining. The Employer members thought that provisions in this respect could only be accepted in a recommendation which was legally non-binding. In this respect, they mentioned that the recognition of internal management prerogatives would consequently lead to a recognition regarding a possible limitation of the right to strike. However, the Committee of Experts had never considered such limitations. In relation to certain restrictions on the right to bargain collectively for public servants other than those engaged in the administration of the State (section 52 of the IRA), the Employer members noted the indication of the Government representative to the effect that there existed committees which had participated on matters related to labour conditions, such as the determination of wages. In conclusion, the Government should be requested to provide precise information as to the collective bargaining which had taken place, the number of such co-determination committees as well as the number of agreements which had been concluded in this respect. This detailed information should be provided in written form as well as information concerning the amendment of section 15 of the IRA currently under consideration.

The Worker members considered this to be a serious case. Despite an ILO mission in 1993 and the Committee's discussion of this case in 1994, the situation remained unchanged. Despite the fact that the Government had had five years to fulfil its promise to repeal legislation limiting the scope of collective agreements for companies granted "pioneer status", the Committee was still empty-handed. Malaysia also had serious problems in regard to the application of Convention No. 87. While the Worker members recognized that the Committee was not now discussing Convention No. 87, they nevertheless drew its attention to the well-known overlap between Conventions Nos. 87 and 98. There was no point in giving workers the right to organize if they could not collectively bargain and no point in giving the right to bargain collectively if they did not have the right to organize. With regard to the three points raised by the Committee, the Worker members expressed their disappointment at the Government representative's statements. In 1994, the Government had indicated that it was taking action to amend section 15 of the Industrial Relations Act (IRA). The Worker members asked the Government to explain what had caused this amendment to remain at a standstill for the past five years. The Government representative was also asked to indicate the status of the proposed amendment and to indicate whether the Government intended to take steps to speed up this process. Disagreeing with the statement of the Employer members that issues such as promotion, employment and termination were matters for exclusive management decision-making, the Worker members stressed that the Committee of Experts had in fact stated that these issues could eventually be considered as internal management prerogatives. The Worker members emphasized that the other issues, namely transfer, dismissal and reinstatement should not be excluded from the scope of collective bargaining according to the Committee of Experts. The Worker members agreed that the legislation could be put in more general terms but noted that, if the Government intended to legislate specifically on this point, it should follow the Committee of Experts' recommendations on this point. He therefore requested the Government to indicate its intention in this regard. The Worker members noted the statement of the Government representative that, in practice, Malaysian employers did not have unfettered rights in regard to restricting collective bargaining. While this was reassuring, it was not relevant to the point made by the Committee of Experts. Simply put, the national legislation was not in conformity with the Convention and therefore must be amended. In relation to the Committee's comments on certain restrictions placed on the right to bargain collectively for public servants other than those engaged in the administration of the State, the Worker members noted the Government representative's statement that the National Joint Councils provided a sufficient avenue for collective bargaining. While the Worker members conceded that no complaints regarding this process had been received from the trade union side, they pointed out the distinction between law and practice and urged that the law be brought into conformity with the Convention. The Government representative was asked to respond to this point. Finally, the Worker members noted that the Government could not cite economic development constraints as an excuse not to conform its legislation with the Convention, which is a fundamental human rights Convention of the ILO without flexibility clauses, and urged the Government to take rapid action in this regard.

The Worker member of Malaysia wished to address the issue of the restrictions on collective bargaining in the public services in Malaysia referred to in paragraph 3 of the report of the Committee of Experts. As the Government had indicated in its report to the Committee of Experts, the Congress of Unions of Employees in the Public and Civil Services (CUEPACS), the officers of the National Joint Councils (NJC) and the Public Service Department (PSD) met on a regular basis to discuss issues affecting employees in the public service. Through these discussions, public sector unions did contribute to the deliberations on remuneration, terms and conditions of employment and the resolution of any problems related thereto. The Government had emphasized and guaranteed that the NJC provided a sufficient avenue for discussions and negotiations on salaries as well as terms and conditions of employment of public servants and that CUEPACS, as the national centre for public servants, played an important and responsible role in protecting the interests of public servants, including wage negotiations. With reference thereto, he stated that while he hoped that a system of collective bargaining could be implemented in the near future, the system of discussions and negotiations previously described would continue to remain applicable and was accepted by CUEPACS. CUEPACS and the Government of Malaysia agreed, in principle, based on the economic situation and improvements therein, that the salary scales would be revised every five years. The last revision for public servants in Malaysia was effective as of 1 January 1992 and was approved by the Government after meetings and discussions with CUEPACS. At the request of CUEPACS, certain adjustments thereto were made in 1995. Negotiations involving CUEPACS for a renewed revision of the salary scales would be initiated in a few months' time, following an agreement with the First Finance Minister of Malaysia on 18 March 1999. This system could be considered as forming part of a collective bargaining mechanism. CUEPACS, which represented some 800,000 civil servants in Malaysia, looked forward to further improvements in the negotiation system for public servants in Malaysia. During the General National Joint Council meeting on 24 April 1999, the Government had agreed in principle to set up an arbitration court for public servants to handle the system of services and other matters arising in public service.

The Employer member of Malaysia wished to address the so-called management prerogative referred to in paragraph 2 of the report by the Committee of Experts. He was pleased to note that the Committee of Experts had accepted that employers did have the freedom to manage and that this freedom also involved certain rights of management. He emphasized that this freedom to manage resulted in the creation of employment and jobs. In order to encourage and enhance such contribution from the employers, certain rights to manage must be retained by the employers and be outside the scope of collective agreement. Some of these rights had, in the case of Malaysia, been incorporated in section 13 of the Industrial Relations Act (IRA). These rights should be retained and the speaker's organization (Malaysian Employers Federation (MEF)) did not encourage the Government to make any amendments thereto. The IRA had functioned satisfactorily for more than 20 years, and in view of the tripartite environment in which it operated, there was no need to change the present situation. In any event, he noted, the employers' management rights could not be arbitrarily exercised. A significant case law emanating from the Industrial Court had fettered the exercise of these rights, and any complaints related to such exercise could be addressed to the Industrial Court. Furthermore, and to the extent that general dissatisfaction exists as regards these rights or the exercise thereof, such issues could be brought up by any party in the National Labour Advisory Council in Malaysia, a tripartite entity set up to discuss labour issues.

The Worker member of Pakistan noted that the Government had not fulfilled its 1994 undertaking to amend section 15 of the Industrial Relations Act. He urged the Government to expedite this process, as well as to amend sections 13(3) and 52 of the Act, in accordance with the recommendations of the Committee of Experts. He took note of the comments made by the Employer and Worker members of Malaysia in which they indicated their desire to improve the present system in the country. He requested the Government to provide the information requested by the Committee of Experts on the manner in which collective bargaining was encouraged and promoted in practice between public employers and public servants other than those engaged in the service of the State. While noting the Government's information that Malaysian legislation had been interpreted by the courts, he pointed out that individual workers were not always able to litigate their complaints. He reminded the Government that it remained under an obligation to bring its national legislation into conformity with the Convention and expressed the firm hope that it would do so in the near future.

Another Government representative of Malaysia thanked all the speakers for their comments. He recalled that it had always been the policy of the Government to review all labour laws to keep them in line with economic developments. He reiterated that there had been no delay to amend section 15 but explained that since 1994, other legal provisions had been amended and that it had been requested that all these amendments be presented together, which of course caused a delay. He also pointed out that the process of amending legislation included consultation with the social partners. He then explained that the 1997 economic downturn had changed certain priorities and that it had been necessary to protect workers' interests. Finally, he assured the Committee that his Government would submit the necessary legislative amendments as soon as they had been adopted by the Government.

The Worker member of Greece considered unacceptable the Government representative's excuse that, despite every effort having been undertaken by the Government to amend its legislation, difficulties remained in adopting new legislation, and that after five years no changes had been recorded, particularly since Malaysia was an economically developed country and had not suffered unduly from the Asian crisis.

The Worker members expressed their disappointment with the response of the Government. The Government had only responded to the first point and that response was the same answer given by the Government in 1992 and 1994. The Worker members urged the Committee to signal a sense of urgency to the Government so that it would expedite the amendment process. The Worker members pointed out that it would be disastrous for the ILO supervisory system if points repeatedly discussed were never acted upon. The Government should be required to respond to the issue raised by the Committee of Experts regarding the legislation regulating internal management prerogatives. Finally, the Government's response that the consultation system with regard to collective bargaining for civil servants was functioning adequately was insufficient.

The Employer members recalled their views expressed in the first intervention. The Conference Committee could not request the Government to eliminate restrictions imposed by section 13(3)(c) of the IRA relating to matters known as internal management prerogatives. Provisions were not necessarily required for matters which would be excluded from collective bargaining. This issue had to be regulated in consultation with the social partners. However, the method to determine matters for collective bargaining could differ from country to country. The Government therefore should only be requested to provide additional information on the subject. Moreover, there was agreement as to the necessity to amend section 15 of the IRA.

The Committee took note of the statements made by the Government representatives and of the discussion which took place thereafter. The Committee acknowledged the willingness of the Government to repeal section 15 of the Industrial Relations Act (IRA), 1967, which limited the scope of collective agreements for companies granted "pioneer status", but recalled that according to the Committee of Experts these "positive measures" had been announced by the Government since 1994. Similarly to the Committee of Experts, the Committee urged the Government to repeal section 15 and to amend section 13(3) of the IRA at an early date so as to ensure that workers' organizations and employers were encouraged to negotiate freely the terms and conditions of employment of the workers in accordance with Article 4 of the Convention. In addition, the Committee asked the Government to provide more information on how collective bargaining was encouraged and promoted in practice between public employers and organizations of employees in the public and civil services. The Committee trusted that the Government would supply a detailed report on concrete measures actually taken to comply with the requirements of the Convention on all the questions raised by the Committee of Experts.

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A Government representative stated that the Committee of Experts raised three main issues in its observation this year. He would confine his comments to these three issues, which related to (1) the scope of collective agreements for companies granted "pioneer enterprises" status; (2) internal management prerogatives; and (3) collective bargaining in the public service. Concerning the first issue, the Cabinet had approved the proposed repeal of section 15 of the Industrial Relations Act which limited the scope of collective agreements for so-called "pioneer enterprises", and appropriate action was currently being taken to repeal this Act. The repealing legislation would be transmitted to the ILO as soon as it was passed by Parliament. Regarding the issue of internal management prerogatives, the speaker pointed out that section 13 of the Industrial Relations Act did not confer any advantages on the employers nor did it cause any disadvantages to workers, as the matters covered by that provision were subject to negotiation, conciliation, arbitration and judicial decisions. These matters could be raised at any time as and when necessary as opposed to other matters covered by collective agreements that were negotiated at specific intervals. Finally, regarding the third issue, section 52 of the Industrial Relations Act referred to collective bargaining in the public service. Public sector employees, through their unions, had been holding regular consultations in respect of some aspects of their terms and conditions of employment, including remuneration. The Congress of Unions of Employees in the Public and Civil Services, the offices of the National Joint Councils and the Public Services Department met every month to discuss issues affecting employees in the public services. Through these discussions, the parties were working towards resolving problems by consensus. The National Labour Advisory Council, a tripartite advisory body, at its meeting in April 1994 had taken note of the need for adaptability to changes in the country's economy and the changing social requirements within the framework of an ongoing process. His Government had taken, and continued to take, positive measures to give effect to the Convention.

The Employers' members thanked the Government representative for his explanations, recalling that most of the questions raised by this case were already discussed by the Committee in 1992 and that a direct contacts mission was undertaken in Malaysia in 1993. The observation of the Committee of Experts dealt with three points. Concerning the limits to collective bargaining in so-called "pioneer enterprises", the Government representative confirmed that they would soon be lifted. He would communicate information on when the law would be modified. The exclusion from collective bargaining of issues relating to the power of management had been much discussed in the past by this Committee. The Government had indicated that even these issues could be negotiated and that there existed regulatory procedures for these types of conflicts. The question of the existence of a proper power of management had nevertheless been raised, and the Employers believed that, in certain areas, the final decision was theirs and could not be shared. But there was no need to attempt to exclude these areas from collective bargaining by law. Concerning restrictions to the right of collective bargaining in the public administration, the Government stated that they were in part compensated by the fact that joint councils of Government and worker representatives met several times per year. It was important to recall that it was voluntary collective bargaining that the Convention was asking for, through the appropriate measures given national conditions. Dialogue must be interpreted as a first step in this sense and it should lead to greater progress. Generally, the Government must be encouraged to progress by the proper avenues and report on all changes that take place.

The Workers' members thanked the Government representative for his explanations before this Committee. The points raised by the Committee of Experts were now sufficiently well known by this Committee so that there was no need to go into detail. It was nevertheless useful to recall that in 1992, this Committee had criticized legislation which allowed unacceptable interference in collective bargaining. The Committee of Experts pointed out this year that the Government was seriously envisaging the repeal of section 15 of the Industrial Relations Act, and the Government representative also indicated that decisions to this end had been taken. It was to be hoped that this was the first sign of a more positive attitude from the Government with regard to standards. It was regrettable that no progress had been made concerning two other issues. The Government representative, who invoked the need to take account of the requirements of economic development, was requested to refer to paragraph 21 of the General Report of the Committee of Experts which underlined that the respect of standards of fundamental human rights must be observed regardless of economic circumstances or fluctuations. This Committee should associate itself with the request of the Committee of Experts for further information. It was appropriate to insist that the Government inform the Office of the measures that it envisaged taking in order to protect workers against acts of interference and discrimination.

The Employers' member of Malaysia asserted that the exclusion by section 13(3) of the Industrial Relations Act of matters relating to an employee's promotion, transfer, termination, dismissal or allocation of duties (management prerogatives) was not in contravention of the Convention. He underlined that section 13(3) did not grant unfettered rights to employers, as demonstrated by numerous decisions of Malaysian courts on this matter. For example, an employer could refuse to promote an employee only for proper cause and any trade union was free under the law to raise questions as to what was or was not proper cause. Moreover, the employers' prerogative of transfer was not unlimited and the courts had ruled that there should be no unreasonableness or want of bona fide on the part of the employer. Termination by way of retrenchment could not be carried out arbitrarily and the "last in, first out" principle had to be applied. Unjust dismissal could entitle the worker to reinstatement. All the above proved that employers were not free to exercise their prerogatives in an unlimited fashion. Therefore, section 13(3) did not impose any limitations and therefore was in line with the Convention. He took exception to the Experts' view that section 13(3) constituted "limitations" to the Convention. He welcomed the Experts' view on the very same issue in paragraph 250 of their 1994 General Survey on freedom of association for holding "tripartite discussions, for the preparation on a voluntary basis of guidelines for collective bargaining", instead of doing away with section 13(3). Moreover, nothing in Convention No. 98 provided for an unfettered right for unions to bargain for their members. To provide that matters such as promotion or transfer or allocation of duties should be covered by a collective agreement would amount to asserting that it was not the management which was responsible for managing the enterprise, which would indeed be contrary to commonly accepted practice worldwide.

The Government member of Indonesia considered that the Government of Malaysia had taken significant steps and achieved progress in this case. First, the Malaysian Government had approved the proposed repeal of section 15 of the Industrial Relations Act which limited the scope of collective agreements for so-called "pioneer enterprises". Moreover, there had been periodical meetings of the tripartite partners in the public sector. It was only a matter of time before the role of the Congress of Unions of Employees in the Public Sector would progress significantly.

The Workers' member from Pakistan wished to draw the attention of the Government representative to the observation of the Committee of Experts in paragraph 2 relating to section 13, subsection 3, which limited the right of collective bargaining on questions of promotion, transfer, employment, termination, dismissal and reinstatement. He disagreed with what the Government representative had asserted, that these questions were not subject to collective bargaining and were instead dealt with by judicial decisions. He disagreed because in his view Article 1 of Convention No. 98 required that workers should enjoy protection against anti-union activities. With respect to collective bargaining rights of public servants not engaged in the administration of the State, the speaker said that the Convention expressly required they had the right to negotiate and the right to collective bargaining. He recalled that the Committee of Experts had emphasized in its General Survey that it was essential that these workers take full part in collective bargaining and should have access to all financial, budgetary and other data enabling them to assess the situation. It did not suffice to say like the Government representative did that there was always consensus in general on these questions. One had to provide for collective bargaining to resolve cases of differences between workers and employers that might eventually arise. He urged the Government to review its legislation in the light of the observation made by the Committee of Experts, and particularly to amend section 15 of the Industrial Relations Act.

The Workers' member from Japan noted the positive tone of the statement made by the Government representative but felt uneasy given the support given by the Employers' member from Malaysia and the Government member of Indonesia, a country which had a very similar outlook regarding the observation of the Committee of Experts. He joined the Workers' members in expressing the hope that real and concrete progress would be made and that the Committee of Experts would then be able to further examine the case.

The Government representative reiterated that positive steps were being taken to bring changes to Malaysian legislation. In so far as the repeal of section 15 of the Industrial Relations Act was concerned, this would be discussed by Parliament in December 1994. Regarding the other two provisions, the National Labour Advisory Council was considering the matter and it was hoped that this Committee would come up with a suggestion as to how the law was to be reviewed in the not so distant future.

The speaker added that although all developing countries considered investment and development needs to be high priority issues, this did not mean sacrificing the interests of labour. Labour played a very important role in the Government's efforts to meet development and investment targets and would continue to do so under the guidance of responsible union leaders. Three major trade union centrals in the country were participating in the National Labour Advisory Council and it was hoped that, through these tripartite discussions with the employers, concrete progress would be made in the near future.

The Workers' members noted that the Government representative was trying to demonstrate that section 13(3) did not raise any problems in practice. If that was the case, it was up to the Government to prove it by furnishing the information requested by the Committee of Experts.

The Committee took note of the statement made by the Government representative and the discussion which followed. The Committee emphasized the fact that, for several years, the Committee of Experts had been making comments on restrictions on the scope of collective bargaining which resulted from the law and restrictions on the rights of employees in the public service to bargain collectively. The Committee, like the Committee of Experts, noted the explanations provided by the Government according to which the provisions referring to collective bargaining in pioneer enterprises were being repealed. It also noted that, in the private sector, matters excluded under the law from collective bargaining were in practice the subject of negotiation. It finally noted that, in the public service, joint committees examined the problems of application of the remuneration machinery recently set up. The Committee expressed the firm hope that restrictions on the scope of collective bargaining contained in the law would be repealed in the near future in order to bring the law into conformity with practice in the private sector, and that the Government would make every effort to encourage and promote voluntary negotiation of working conditions and remuneration of employees in the public service covered by the Convention. The Committee requested the Government to submit a detailed report to the Committee of Experts to allow it to assess to what extent real progress had been made in law and in practice in these areas.

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A Government representative noted section 13(3) of the Industrial Relations Act and its non-conformity with Article 4 of the Convention and that more detailed clarification of the explanations supplied to the Committee of Experts was necessary. Under section l3(3) of the Industrial Relations Act, 1967, the following matters, which the Government representative referred to as management functions, were excluded as subjects for collective bargaining: promotion; transfer; employment; terminations; dismissal and reinstatement; and assignment or allocation of duties or specific tasks to a worker. However, such matters could be raised by trade unions in discussions with an employer or employers' organisations, within or outside the course of collective bargaining, if these matters affected the individual worker. In his view, the trade union was therefore free to fully utilise its collective bargaining machinery to settle issues relating to terms and conditions of employment. The six matters excluded from collective bargaining had been the subject of negotiation, conciliation and arbitration, as well as decisions of the Industrial Court, High Court and Supreme Court, and amounted to 54.2 per cent of all disputes dealt with by the Department of Industrial Relations during the past five years. He considered that these six areas were internal management functions or prerogatives, and that the provision in question was merely a restatement of the rights of employers under contract law. These prerogatives were subject to limitations; for example, transfers could not be made mala fide, as a means of victimisation, as an unfair labour practice or for any other ulterior motive. He emphasised that the Industrial Relations Act provided sufficient protection for workers' rights. In his view, section 13(3) concerned matters leading to individual disputes, but had little relation to collective agreements. A further restriction on the exercise of the employers' rights was provided in section 5(2), which provided that such rights could only be exercised for proper cause. As regards the position of companies granted pioneer status under section 6 of the Promotion of Investments Act, 1966, the Government representative stated that trade unions in companies granted pioneer status were not allowed to conclude collective agreements granting benefits relating to rest days, hours of work, holidays, annual leave, sick leave and payment for extra work (referred to as non-monetary items) that were more favourable than those contained under Part XII of the Employment Act, 1955, unless the provisions were approved by the Minister of Human Resources. However, such trade unions and companies could without restriction conclude collective agreements regarding such matters as wages, bonuses, allowances, compassionate leave, paternity leave, unpaid leave, study leave, trade union leave, maternity leave, retirement benefit, and other terms and conditions of employment. The Government representative emphasised that although the repeal of section 15 of the Industrial Relations Act, 1967, was currently being discussed with the employers' organisation and workers, job creation was a priority because of the present circumstances of the country, and for this reason such a repeal would not be made until the appropriate circumstances existed. The restriction on the right to bargain collectively of employees in public administration (850,000 employees), pursuant to section 52 of the Industrial Relations Act, 1969, was primarily because of the differing objectives of the public and private sectors. The public sector was service rather than profit-oriented and therefore wages paid to public sector employees were not based on the same principles that applied to the private sector. All civil servants were governed by the same General Orders, and their duties were classified as "supporting elements" so that they were among those engaged in the "administration of the State". The Government representative stated that in the public sector negotiations and discussions took place at the national level; since the late 1970S five National Joint Councils for the public service had negotiated wage increases and working conditions and had engaged in consultation on behalf of public employees. Such negotiations resulted in a significant pay increase in 1989 and the offer of a New Remuneration System in 1991. In addition, a Joint Committee was formed on 30 October 1985. The Joint Committee signed a Joint Declaration on 6 June 1986 agreeing to meet regularly for the settlement of disputes arising from claims in respect of salary and other terms and conditions of employment of public administration employees. He emphasised that this was evidence that the Government did, in practice, negotiate with its employees on such matters.

The Workers' members recalled that these questions concerning the Convention had been raised by the Committee of Experts for a long time and that they were discussed in the Conference Committee in 1981, 1983 and 1985. They noted that the report and the replies of the Government had not shown any progress since 1985. Information should be communicated by the Government to the Office so that the extent to which new developments might have taken place could be examined by the Committee of Experts. The two major problems concern firstly the contents of the legislation under discussion, and secondly the attitude of the Government towards the supervisory system and the universality of standards. As regards the content of the legislation, it essentially concerns the Government's control over collective bargaining illustrated by three divergences between the national legislation and Article 4 of the Convention as mentioned by the Committee of Experts. The Government not only restricts the scope of collective bargaining but made the legislation in such a way that the workers could not be treated on equal footing with the employers, as is shown in section 13(3) of the Industrial Relations Act. The spirit of this legislation was confirmed by the Government, namely that questions enumerated in section 13(3) such as promotions, transfers, dismissals should not be the subject of negotiations because this could lead to prolonged strife since the managers are unlikely to agree to any erosion of their rights during the process of negotiating a collective agreement. This explanation demonstrates an imbalanced attitude of the Government to collective bargaining and also its paternalistic spirit. Besides, the legislation excludes the workers of pioneering enterprises from the possibility of concluding agreements during five years on such fundamental aspects of their working conditions as working hours, paid leave, annual or sick leave, which causes a problem, especially for the enterprises in the export processing zones. The Workers' members would never accept a selective or partial application of international labour standards. The possibility provided by the Act for the Minister to validate negotiations affecting these working conditions underlined further interventionism of the State and its attitude towards the parties. As to the attitude of the Government concerning the application of standards, particularly the universality of standards, the Workers' members observed that the Committee of Experts noted the Government's opinion that "there should, not be a too legalistic or technical approach taken over the application of ratified Conventions in this era of increasing protectionism adopted by certain trading blocs and that the attempt of developing countries to develop their economies and eradicate poverty should be looked at in a positive light". The Workers' members stated that such objectives of socio-economic development were normal but should not be put in opposition with the standards and fundamental rights enshrined in the Convention. They could not accept such an attitude of the Government and referred to the resolution concerning freedom of association and freedom of collective bargaining adopted by the 1lth Asian Regional Conference, as well as to their own statement during the general discussion and to the conclusions of the Committee on Freedom of Association in the Case No. 1552 concerning Malaysia in which that Committee recalled that fundamental human rights such as those guaranteed by the Convention should be respected whatever the level of development of the country. The Workers' members urged the Government to eliminate the restrictions contained in the legislation so as to bring it into conformity with the Convention and stated that a visit on the spot by the ILO would perhaps help to overcome the difficulties. They expressed their great concern of the situation of the application of the Convention in Malaysia because the trade union movement as a whole was concerned. It concerns a conflict between long-standing values, methods and principles of the ILO on the one hand and the Government's unacceptable interpretion of the obligations arising under the Convention on the other.

The Employers' members stated that the ideal of the Convention was free collective bargaining, but that the reality in many countries was far from this ideal. In Malaysia certain aspects regarding the functions of management could not be the subject of collective bargaining, although they were not outside of all regulatory measures because an appeal was possible to a tribunal. Such aspects as wages could be negotiated collectively, while other aspects were regulated in a different manner. Such situations were common in many countries and demonstrated that there was no absolute freedom of collective bargining. In Malaysia, therefore, there was no total restriction, but important exclusions remained, and the Government should reconsider the possibility of widening the scope of collective bargaining. As regards pioneer enterprises, especially those in export processing zones, although wages could be the object of collective bargaining, restrictions remained as regards some other working conditions; these could be the subject of collective bargaining but needed to be submitted for ministerial approval (which had never been refused). Such measures are usual and widespread so as to promote a new economy in a developing country, but they were not in conformity with the provisions of the Convention. The Government representative stated that it contemplated removing this prohibition because it considered that industry in protected zones was prosperous enough to be covered by normal legislation and treated on an equal footing with other branches; legislation could thus be brought into conformity with the Convention on this point. The Government should intensify its efforts in this regard. As concerns the restrictions of right to bargain for certain employees of the public service, the Government contemplated privatisation in this field. This was a positive move which would resolve the problem because private sector employees can bargain collectively. Nevertheless, concerning the public service, there remained a gap with the objectives of the Convention. The Employers' members wished that the Government would conform with the requirements of the Convention.

An Employers' member of Malaysia considered that the provisions under section 13(3) of the Act were "measures appropriate to national conditions" and were not incompatible with Article 4 of the Convention. Somebody's right is always subject to the right of others. The right of workers to collective bargain must be viewed against certain rights of employers relating, for example, to promotion, transfer and assignment of duties. Employers are responsible for managing the enterprise, although they cannot exercise their right unfairly. There are court cases against employers acting without just cause. Section 13(3) must be seen within the context of other legislative provisions and practices in Malaysia. Could one ever bargain in an unlimited way with regard to appointment, promotion, transfer or assignment of duties? The speaker hoped that the Committee would review the conclusion of the Committee of Experts relating to section 13(3) accordingly.

A Workers' member of Japan remarked that this case had been before the Committee for many years without progress. There were three questions: (i) limitation on the scope of negotiable matters; (ii) prohibition with regard to pioneer industries; and (iii) restriction on the right to bargain collectively for employees in public services. Although such restrictions exist in many countries in Asia, the Malaysian case was a serious one. The speaker expressed concern at the attitude of the Government and the impression given by the report that the situation appeared to have deteriorated. He pointed out that the Government's intention to take measures only when political, economic and social conditions of the country warranted it, was no assurance at all and would mean that the Government had the right to interpret the Convention as it liked. He also remarked that Malaysia, which used to have relatively liberal labour legislation, had gradually tightened its grip over trade union rights, while its economy developed at a high speed. He requested the Government representative to respond to the suggestion by the Committee of Experts that technical assistance from the Office could be requested for the purpose of bringing the law and practice into conformity with the Convention.

A Workers' member of the United States strongly supported the statement made by the Workers' spokesman. Noting the Government's statement of intention to improve the situation in each of the three areas discussed, he pointed out some contradictions in the first statement that the provision would not be repealed until the political, economic and social conditions of the country warranted it, and the subsequent statement that active steps were now being taken to repeal this provision. The speaker emphasised a need for the Government to submit these new undertakings for evaluation by the Committee of Experts.

A Workers' member of Malaysia indicated the improvement in political, economic and social conditions in Malaysia, with economic growth of 8.8 per cent, and an unemployment rate of about 4.4 per cent. As regards section 13(3), unionised workers may be able to talk with employers and apply pressure regarding these matters, but non-unionised workers would be helpless when section 13(3) protects rights of employers to hire and fire. The speaker hoped, regarding pioneer enterprises, that the matter would be dealt with in the country within a tripartite discussion. As to the public sector, the speaker pointed out that there was no collective bargaining right for the public service except for the matters regarding which the public service union submitted a claim to the Government. The Government considered, the Cabinet decided and the matter was referred to the union for acceptance, which is not real collective bargaining.

A Workers' member of the Netherlands requested the Office to explain the reason why this case had not been discussed since 1985. The speaker pointed out that the Convention not only granted the right to bargain collectively but also had a definite promotional character. As regards section 13(3), noting the Government's statement that workers could negotiate if they really wanted, he wondered why the Government put in the legislation that these elements should be excluded from collective bargaining.

A Workers' member of Romania stated that the workers of his country were worried by the attitude of the Malaysian Government regarding international labour standards, in particular this Convention, because such an attitude would be against the freedom of collective bargaining and values of the Constitution of the ILO. The universality of standards, in particular of free collective bargaining between two parties on equal footing was an essential value. Coming out of a totalitarian system which always refused the universality of standards, Romanian workers did not want such ideology to continue any longer.

A Workers' member of Uganda, noting that Malaysia was economically relatively well-placed, expressed surprise and disappointment as the Government stated that the prohibition of workers' rights was intended to promote investment, stimulate growth and generate employment opportunity and that the Government considered such matters as hours of work, holidays, annual and sick leave as not fundamental. The speaker expressed a worry that, if the suppression of workers' rights could not be stopped, it would threaten the good work done by the ILO and would also threaten other countries which grant such rights, because any country, needing to promote investment and to stimulate industrial growth, might follow the example of Malaysia. The speaker, referring to the Government's intention for privatisation, stated that there was no guarantee that the Government would not protect the investor after privatisation. He disagreed with the Employers' member of Malaysia in relating the rights of workers with the rights of employers.

A Workers' member of Pakistan referred to the General Survey on Freedom of Association and Collective Bargaining and noted that, according to the Government, privatisation would open the way to bargaining. As regards section 13(3), such issues as lay-off, retrenchment and promotion should not be excluded from bargaining and he looked forward to positive legislative developments in this area.

A Workers' member of Ecuador was particularly concerned by the case of Malaysia: there was no doubt about the importance attached to the Convention by both Workers' and Employers' members. As one of the objectives of collective bargaining was to contribute and to promote progress and economic development and to eliminate poverty, he was surprised that the Government felt that the Convention should be applied on the basis of political, economic and social conditions in a country. The economic situation was also of concern in Latin American countries; if the Government's criteria was followed, the application of this Convention would be a privilege of rich countries which less-favoured countries could not realise. This would be contrary to the principle of universality of standards. The idea that collective bargaining could hinder development and contribute to increased misery was, to say the least, inappropriate. Referring to the restrictions on collective bargaining rights of public service employees, the speaker believed that the activities of the National Joint Council - which the Government felt would allow partial application of the Convention - were totally insufficient. Concerning the privatisation of various state enterprises and its impact - anticipated by the Employers' spokesman - on the right of workers to collectively bargain, the speaker considered this not to be the issue: the question was whether there existed the right to collectively bargain as provided for in the Convention. As this case had been discussed for many years, he hoped that the Government would in the future make substantial progress.

A Workers' member of Germany supported the statement of the Workers' spokesman regarding, in particular, the right of public servants to bargain collectively; in this regard the Convention laid down the minimum standard. Under the Convention each State had to guarantee the right to organise and to bargain collectively and it is indispensible that enterprise management recognise the importance of collective bargaining at the enterprise level. It should be possible to fix wages and other conditions of work through collective bargaining with management. Both workers' and employers' organisations participate in this process; the setting of conditions of work is neither a privilege for workers nor a prerogative of management, but a right which belongs to both parties. In order to promote the development of one region or a part of the country, recourse could be had to financial incentives, protective measures, or other governmental policies; such development should not be promoted by limiting collective bargaining rights. When a State ratifies this Convention it undertakes to guarantee free collective bargaining. The authorities had to guarantee collective bargaining rights even in multinational enterprises and had to resist contrary pressures from such enterprises.

Another Workers' member of Malaysia stated that, although section 13(3) forbids collective bargaining on promotions and transfers, clauses on these subjects were in actual practice signed and agreed to in collective bargaining. Many transfers and promotions have even been successfully challenged. It was a wrong impression that the law prevented workers or unions from acting in these areas.

A Government member of the Congo stated that the problem under discussion contained aspects of both principle and practice; it was the practical aspect which interested him since a similar situation existed in his country. A balance should be found between the right of different categories of workers to negotiate collectively all the aspects of their working conditions and legitimate management prerogatives. In some developing countries workers had become practically like the employers during collective bargaining; this undoubtedly explained part of the situation in Malaysia. The protection of investors could be realised by, for example, prescribing in internal regulations the role of each institution, in particular that of trade unions. The systematic prohibition by public authorities of collective bargaining should be avoided; legislation making such provision should be modified. One should find a way in which, in practice, all concerned maintain their powers.

The representative of the Secretary-General replied to the question put by a Workers' member concerning the reasons why the Office did not include this case on the list of individual cases since 1985. The Office does not draw up this list. In fact the draft list of individual cases is elaborated in the Employers' and Workers' groups, and then is examined by the Officers of the Committee who then submit this list to the Committee for approval. The Secretariat does not play any role in this process, except for readily responding to any requests for information. Besides, the Committee of Experts made observations on this case in 1987, 1989, 1991 and 1992, that is to say, every year in which this Convention had to be examined.

The Government representative explained that the question of "attitude" as raised by many Workers' members was solely based on one's perception and predetermined values. Stressing that Malaysia certainly had better track records in the area of workers' rights compared to many other countries, he stated that he would not wish to be drawn into unnecessary debate on that subject-matter.

The Government representative stated that the rights of workers should be weighed against the rights of the employers, and that the denial of the latter would only be detrimental to workers' interests by leading to such things as bankruptcies. The right of the employers to manage did not restrict the workers' right to collective bargaining. He stressed that discussions had been taking place with the social partners on the possible deletion of section 15 relating to the restrictions on collective agreements in certain new undertakings, and as such Malaysia could not accept the assertion that there had been no progress made since the last report. It was also explained that the six issues stipulated in section 13(3) were not absolute and were increasingly being negotiated. As to the question of universality, he emphasised that one has to look and diagnose the situation in a particular country by looking into the context of the situation and the level of economic development. He further stressed that everyone including those in the Committee were duty bound to help workers find employment, share their incomes and improve their standard of living. He reiterated that in the public service there was negotiation and conciliation on matters pertaining to wages and conditions of service. The Government representative stated, regarding the possibility of technical assistance by the ILO, that if the ILO considers it necessary to send a mission, the Government would be glad to receive it.

The Workers' members stated that it was indispensable for the Government to communicate shortly a report for examination by the Committee of Experts. They were surprised to see the Government representative repeat the logic of the Employers' member of Malaysia that the rights of some limit the rights of others. They did not understand, regarding the Convention concerning collective bargaining and the possibility to reach agreement, how one could speak of limiting the right to negotiate and therefore to reach agreement. It concerns the freedom to discuss. The Workers' members recalled their earlier suggestion that if the Government considers that there remained problems of interpretation, it could call for assistance or a visit on the spot by the Office.

The Committee noted with some disappointment the information given by the Government, recalling that this case has been the subject of its concern on different prior occasions. It felt bound to emphasise the seriousness of the protection and promotion of the right to bargain collectively as guaranteed under the Convention. The Committee therefore urged the Government to reconsider its position and make use of the good services of the ILO in that respect. It hoped that the Government would send a report with full particulars to the ILO to enable the Committee to find the legislation to be in complete conformity with the Convention at one of its next sessions.

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The Committee notes that the Government indicates in its report and response to the comments made by the International Trade Unions Confederation (ITUC) on 24 August 2010 that the amendments to the Trade Union Act, 1959, and the Industrial Relations Act (IRA), 1967, have been approved by Parliament and came into effect on 28 February 2008, and that the Industrial Relations Regulations 2009 were subsequently enacted on 8 October 2009. According to the Government, the amendments to the IRA provide, inter alia, for a fast and efficient procedure for recognition for collective bargaining purposes. The Committee also notes the conclusions reached by the Committee on Freedom of Association in Case No. 2301 (353rd Report of the Committee on Freedom of Association, paragraphs 133–140, and the 356th Report, March 2010). The Committee therefore requests the Government to transmit a copy as soon as possible of the final version of the abovementioned legislation.

Articles 1 and 4 of the Convention. Trade union recognition for purposes of collective bargaining. Duration of proceedings for the recognition of a trade union. In its previous comments, the Committee had noted the comments by the ITUC reiterating issues previously raised by the Committee regarding long delays in the treatment of union claims to obtain recognition for collective bargaining purposes. The Committee had requested the Government to submit more precise information on the ITUC’s comments in the light of the provisions of the IRA and to indicate the average duration of proceedings for the recognition of a union, as well as the requirements for obtaining recognition. The Committee notes the Government’s indication that, under the new legislations, the average duration of proceedings for the recognition of a union is nine (9) months, provided that the parties involved do not challenge the process through judicial review in the court or raise issues that could cause delays. The Committee considers that this average duration of proceedings is excessively long and requests the Government to take measures to modify the legislation in order to reduce the length of proceedings for the recognition of trade unions.

Procedure of recognition. The Committee further notes that the Government indicates that, in order to be accorded recognition, the relevant union has to undergo a competency check (conducted by the Industrial Relations Department) to ascertain whether the majority of the class of workers of the enterprise had become members of the union seeking recognition. However, the Committee notes that the Government makes no reference to the applicable legislation. The Committee therefore requests the Government to indicate in its next report what the requirements in order to fulfil the competency check are and to indicate the relevant legislative provisions applicable.

In addition, the Committee notes that the Government indicates in its report that, in claims for recognition, once the trade union concerned has served Form A on the company, the employer shall have 21 days to either accord the recognition or to reject the claim. Should the company reject the claim for recognition, either at the end of the 21 days or anytime before that, then the union has to inform the Director General of Industrial Relations (DGIR) within 14 days after receiving such notification by the company. The DGIR will then take appropriate action. The Committee further notes that section 9(5) of the IRA states that the Minister has the final say on whether recognition is to be accorded by the employers to the unions. However, an aggrieved party may apply for a judicial review at the High Court against the decision. While recalling again the excessive length of these proceedings, the Committee requests the Government to indicate the criteria applicable to the decisions of the DGIR and/or the Minister.

Sanctions applicable for refusal to apply orders of recognition and of reinstatement. In its previous comments, the Committee had noted the Government’s statement about the comments previously made by the ITUC with regard to the inefficiency of labour courts concerning the application of the provisions of the Convention. On this matter, the Committee had noted the ITUC’s comments that the Government failed to apply any sanctions against employers who opposed the directives of the authorities granting trade union recognition or who have refused to comply with Industrial Court orders to reinstate unlawfully dismissed workers. The Committee had requested the Government to submit its observations on these matters.

The Committee notes the Government’s indication that: (i) the Industrial Court has jurisdiction for trade disputes under section 26 of the IRA and in cases of dismissals under section 20 of the IRA; (ii) under section 56(1), (3) and (4) and section 60 of the IRA, there are procedures and sanctions applicable against employers who opposed the directives of the authorities granting trade union or who have refused to comply with Industrial Court orders to reinstate unlawfully dismissed workers; and (iii) the Industrial Relations Department has set up a Legal Division to initiate legal proceedings against any errant party that contravenes the law. In these circumstances, the Committee requests the Government to provide details about the composition and functioning of the Legal Division of the Industrial Relations Department, and to provide a copy of its Rules of Procedures. The Committee also requests the Government to provide information and statistics on any sanctions against employers who opposed the directives of the authorities granting trade union recognition or who have refused to comply with Industrial Court orders to reinstate unlawfully dismissed workers in the last two years.

Migrant workers. In its previous comments, the Committee had noted that, although foreign and local workers enjoy equal rights; migrant workers can join a union but cannot be elected as trade union officers under the Trade Union Act. In this respect, the Committee had recalled that workers, including migrant workers, should enjoy the right to elect their representatives freely and it had requested the Government to communicate its observations on the exercise of trade union rights by migrant workers in law and in practice. The Committee notes the Government’s indication that: (i) to form and to be elected as trade union representatives, the foreign workers require permission from the Minister of Human Resources; (ii) there are currently trade unions who have foreign workers as members; and (iii) foreign workers have been appointed as representatives of certain trade unions. The Committee considers that the requirement for foreign workers to obtain the permission from the Minister of Human Resources in order to be elected as trade union representatives hinders the right of trade union organizations to freely choose their representatives for collective bargaining purposes. The Committee requests the Government to take measures in order to modify the legislation.

Scope of collective bargaining. The Committee had previously urged the Government to amend the legislation so as to bring section 13(3) of the IRA, which contains restrictions on collective bargaining with regard to transfer, dismissal and reinstatement (some of the matters known as “internal management prerogatives”), into full conformity with Article 4 of the Convention. The Committee notes with regret that the Government indicates in its report that there is no need to amend the said provision and reiterates that: (i) section 13(3) of the IRA is not intended to limit collective bargaining, but rather to provide for the right of employers to run their business in the most efficient way and to protect from abuse of the collective bargaining process; and (ii) these requirements are not absolute and matters relating to them may be brought to the Industrial Relations Department and, if no settlement is reached, the matter may be referred to the Industrial Court for adjudication (section 13(8) of the IRA). The Committee further notes the case law Sarawak Commercial Banks Association v. Sarawak Bank Employees’ Union, submitted by the Government. Nevertheless, the Committee considers that section 13 of the IRA restricts the scope of negotiable matters. The Committee recalls that measures taken unilaterally by the authorities to restrict the scope of negotiable issues are often incompatible with the Convention; tripartite discussions for the preparation, on a voluntary basis, of guidelines for collective bargaining are a particularly appropriate method to resolve these difficulties (see General Survey of 1994 on freedom of association and collective bargaining, paragraph 250). The Committee therefore once again requests the Government to amend section 13(3) of the IRA so as to remove these restrictions on collective bargaining matters and to initiate tripartite discussions for the preparation, on a voluntary basis, of guidelines for collective bargaining.

Compulsory arbitration. In its previous comments, the Committee had noted that section 26(2) of the IRA allows compulsory arbitration, by the Minister of Labour of his own motion even in case of failure of collective bargaining. The Committee had requested the Government to take measures to ensure that the legislation only authorizes compulsory arbitration in essential services, in the strict sense of the term, for public servants engaged in the administration of the State or in cases of acute national crisis. The Committee notes that the Government reiterates that, although the provision accords discretionary powers to the Minister to refer a trade dispute to the Industrial Court for arbitration, practically, the Minister has never exercised such power in an arbitrary manner and only makes a decision upon receipt of a notification from the Industrial Relations Department that the conciliation has failed to resolve the dispute amicably. The Committee once again recalls that the imposition of compulsory arbitration procedure if the parties do not reach agreement on a draft collective agreement raises problems in relation to the application of the Convention. Therefore, the Committee once again reiterates its previous comments and urges the Government to take measures to ensure that the legislation only authorizes compulsory arbitration in essential services, in the strict sense of the term, for public servants engaged in the administration of the State or in cases of acute national crisis.

Restrictions on collective bargaining in the public sector. The Committee has for many years requested the Government to take the necessary measures to ensure for public servants not engaged in the administration of the State the right to bargain collectively over wages and remuneration and other employment conditions. The Committee notes with regret that the Government, invoking the peculiarities of the public service, once again reiterates that it will maintain the policy of not engaging in that kind of collective bargaining with the employees of the public sector. The Government once again points out that trade unions can express their views on matters concerning conditions of work through the National Joint Council and the Departmental Joint Council. Nevertheless, the Committee, while recognizing the singularity of the public service which allows special modalities, considers that simple consultation with unions of public servants not engaged in the administration of the State do not meet the requirements of Article 4 of the Convention. Therefore, the Committee urges the Government to take the necessary measures to ensure for public servants not engaged in the administration of the State the right to bargain collectively over wages and remuneration and other employment conditions, in conformity with Article 4 of the Convention.

The Committee reminds the Government that it may avail itself of the ILO’s technical assistance so as to bring its law and practice into full conformity with the Convention if it so wishes.

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The Committee notes the comments submitted by the International Trade Union Confederation (ITUC) on 29 August 2008, according to which the Government in the National Labour Advisory Council (tripartite body) did not consult with the labour movement with regard to the tabling of the Industrial Relations (Amendment) Bill 2007 which restricts union rights in the process of recognition by the employer (i.e. the secret ballot of workers to be undertaken allows the employer to manipulate the size of the bargaining unit for the purpose of the election, etc.). The Committee notes that the Government refers to tripartite consultation concerning the Bill; thus, it requests the Government to submit detailed observations to permit it to examine the Bill’s conformity with the Convention and to provide a copy of the Bill once adopted.

The Committee notes the comments by the ITUC reiterating issues previously raised by the Committee regarding long delays in the treatment of union claims to obtain recognition for collective bargaining purposes. The Committee notes that, according to the 2006 Government report, the cause of the delay is mainly due to the time taken by legal proceedings lodged either by trade unions or an employer against the decision of the Director-General of Trade Unions (DGTU) on issues of competency or membership verifications. The Committee notes that, according to the Government, the Bill is shortening the timeframe for recognition of trade unions. The Committee requests the Government to submit more precise information on the ITUC’s comments in the light of the provisions of the Bill and to indicate the average duration of proceedings for the recognition of a union, as well as the requirements for obtaining recognition.

The Committee notes the Government’s statement about the comments previously made by the ITUC with regard to the inefficiency of labour courts concerning the application of the provisions of the Convention. The Government indicated that: (1) efforts are made to further increase the number of Industrial Court chairmen who will be assigned to deal with cases in designated areas; (2) recently implemented and computerized case management in the Court will help the Court President to monitor more closely cases in the courts; and (3) this process is supposed to expedite the issuance of awards. On this matter, the Committee notes the ITUC’s comments that the Government failed to apply any sanctions against employers who opposed the directives of the authorities granting trade union recognition or who have refused to comply with Industrial Court orders to reinstate unlawfully dismissed workers. The Committee requests the Government to submit its observations on these matters.

Restrictions on collective bargaining for certain categories of worker. The Committee had urged the Government to repeal section 15 of the Industrial Relations Act (IRA), which limited the scope of collective agreements for companies granted “pioneer status”, for instance with respect to election campaigns. The Committee notes with satisfaction the deletion of section 15 of the IRA due to the amendment of the aforementioned legislation.

The Committee notes that, according to the ITUC, 2.6 million migrant workers in Malaysia are prevented by law from organizing or applying to register a trade union and are barred from serving as officers of a trade union. The ITUC adds that the system for registering migrant workers discourages them from asserting their rights because it grants total discretion to employers to terminate workers for virtually any reason. The Committee notes that, according to the Government, foreign and local workers enjoy equal rights; migrant workers can join a union but cannot be elected as trade union officers. Recalling that workers, including migrant workers, should enjoy the right to elect their representatives freely, the Committee requests the Government to communicate its observations on the exercise of trade union rights by migrant workers in law and in practice.

Scope of collective bargaining. The Committee had previously urged the Government to amend the legislation so as to bring section 13(3) of the IRA, which contains restrictions on collective bargaining with regard to transfer, dismissal and reinstatement (some of the matters known as “internal management prerogatives”), into full conformity with Article 4 of the Convention. The Committee notes that the Bill amends section 13 by inserting three subject matters in a proposal for a collective agreement (training to enhance skills and knowledge of the workmen; annual review of the wage system; and a performance-based remuneration system). The Committee notes that according to the Government: (1) section 13(3) of the IRA is not intended to limit collective bargaining, but rather to provide for the right of employers to run their business in the most efficient way and to protect from abuse of the collective bargaining process; (2) these requirements are not absolute and matters relating to them may be brought to the Industrial Relations Department and, if no settlement is reached, the matter may be referred to the Industrial Court for adjudication; and (3) in matters concerning transfers, parties are allowed to discuss the procedures for promotion of a general character. The Committee underlines that section 13 of the IRA restricts the scope of negotiable matters. The Committee reiterates therefore that measures taken unilaterally by the authorities to restrict the scope of negotiable issues are often incompatible with the Convention (see General Survey of 1994 on freedom of association and collective bargaining, paragraph 250) and once again requests the Government to amend section 13(3) of the IRA so as to remove these restrictions on collective bargaining matters. Furthermore, the Committee requests the Government to indicate whether there are any judicial decisions by the Industrial Court on this point and, if so, to transmit copies of the same in its next report.

Compulsory arbitration. The Committee notes that section 26(2) of the IRA allows compulsory arbitration, by the Minister of Labour of his own motion even in case of failure of collective bargaining. The Committee recalls that arbitration imposed by the authorities at the request of one party is generally contrary to the principle of the voluntary negotiation of collective agreements established in the Convention, and thus the autonomy of bargaining partners (see General Survey, op. cit., paragraph 257). Therefore, the Committee requests the Government to take measures to ensure that the legislation only authorizes compulsory arbitration in essential services in the strict sense of the term, for public servants engaged in the administration of the State or in cases of acute national crisis.

Restrictions on collective bargaining in the public sector. The Committee had previously requested the Government to provide information on the possibility of collective bargaining under the auspices of the National Joint Council and the Departmental Joint Council.

The Committee notes that the Government states that: (1) it has its own forum, i.e. the National Joint Council and the Department Joint Council, to discuss grievances in the public sector and to consider any suggestions to improve terms and conditions of employment of public servants; (2) the outcomes of consultations pertaining to salaries and remuneration are subject to the decision of the Cabinet Committee on Establishment and Salaries of Employees in the Public Sector, and are to be tabled and legislated in Parliament; and (3) it maintains its position of not recognizing the right to collective bargaining of public servant unions not engaged in the administration of the State.

The Committee recalls that, while the principle of autonomy of the parties to collective bargaining is valid as regards public servants covered by the Convention, the special characteristics of the public service require some flexibility in its application. Thus, legislative provisions allowing Parliament or the competent budgetary authority to set upper and lower limits for wage negotiations, or to establish an overall “budgetary package”, within which the parties may negotiate monetary or standard-setting clauses (i.e. reduction of working hours, varying wage increases according to levels of remuneration), are compatible with the Convention, provided they leave a significant role to collective bargaining (see General Survey, op. cit., paragraphs 261–264). The Committee considers that simple consultation with unions of public servants not engaged in the administration of the State do not meet the requirements of Article 4 of the Convention. The Committee requests the Government to take the necessary measures to ensure for public servants not engaged in the administration of the State the right to bargain collectively over wages and remuneration and other employment conditions.

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The Committee notes the Government’s reports and the comments submitted by the International Confederation of Free Trade Unions (ICFTU) on 10 August 2006. The ICFTU’s comments principally refer to matters previously raised by the Committee as well as to allegations of long delays in the disposition of claims for union recognition, and the establishment of a trade union by an employer in order to avoid recognizing and bargaining with another trade union. The Committee requests the Government to submit its observations thereon.

1. Article 4 of the Convention. Collective bargaining in “pioneer enterprises”. Previously, the Committee had urged the Government to repeal section 15 of the Industrial Relations Act (IRA), which limits the scope of collective agreements for companies granted “pioneer status”, and had requested a copy of the repealing legislation upon its adoption. The Committee notes the Government’s indication that discussions on the IRA with representatives of the employers and trade unions were in their final stages: the amendments to the IRA, which include the repeal of section 15, were expected to be submitted to Parliament for the December 2005 sitting. In this connection, the Committee, recalling that the repeal of section 15 of the IRA has been delayed for several years, once again urges the Government to ensure that there are no further delays in the repeal of this legislation and to keep it informed of developments respecting the adoption of the amendments to the IRA.

2. Restrictions on collective bargaining over certain issues. The Committee had previously urged the Government to amend the legislation so as to bring section 13(3) of the IRA, which contains restrictions on collective bargaining with regards to transfer, dismissal and reinstatement (some of the matters known as “internal management prerogatives”), into full conformity with Article 4 of the Convention. The Committee notes the Government’s statement that section 13(3) of the IRA is not intended to limit collective bargaining, but rather to provide for the right of employers to run their business in the most efficient way and to protect from the abuse of the collective bargaining process. The Government further indicates that these requirements are not absolute; matters relating to them may be brought to the Industrial Relations Department and, where no settlement is reached, the matter is referred to the Industrial Court for adjudication. The Committee notes this information. It recalls, in this respect, that measures taken unilaterally by the authorities to restrict the scope of negotiable issues are often incompatible with the Convention (see General Survey of 1994 on freedom of association and collective bargaining, paragraph 250) and once again urges the Government to amend section 13(3) of the IRA so as to remove the restrictions on collective bargaining. The Committee also requests the Government to indicate whether there are any decisions of the Industrial Court where the restrictions set forth in section 13(3) were successfully challenged and, if so, to transmit copies of the same in its next report.

3. Restrictions on collective bargaining in the public sector. The Committee had previously requested the Government to provide information on the scope of collective bargaining under the auspices of the National Joint Council and the Departmental Joint Council. Specifically, it had asked the Government to indicate whether any limitations on the agreements produced by the consultations taking place within these bodies exist – particularly as to terms and conditions of service, the remuneration structure, and the form and scope of any agreements reached. In this regard, the Committee notes the Government’s statement that the outcomes of consultations pertaining to salary and remuneration are subject to the decision of the Cabinet Committee on Establishment and Salaries of Employees in the Public Sector, and are to be tabled and legislated in Parliament. In these circumstances, the Committee recalls that, while the principle of autonomy of the parties to collective bargaining is valid as regards public servants covered by the Convention, the special characteristics of the public service described above require some flexibility in its application. Thus, legislative provisions allowing Parliament or the competent budgetary authority to set upper and lower limits for wage negotiations, or to establish an overall “budgetary package”, within which the parties may negotiate monetary or standard-setting clauses (i.e. reduction of working hours, varying wage increases according to levels of remuneration), are compatible with the Convention, provided they leave a significant role to collective bargaining (see General Survey, op. cit. paragraphs 261-264). The Committee considers that subjecting all of the outcomes reached by the Councils’ consultations on salaries and remuneration to the approval of the authorities, in particular the Cabinet Committee on Establishment and Salaries of Employees in the Public Sector, is not in conformity with Article 4 of the Convention. It requests the Government to take the necessary measures to ensure for public servants not engaged in the administration of the State the right to bargain collectively, including over wages and remuneration, in keeping with the abovementioned principle on collective bargaining in the public sector.

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The Committee takes note of the information contained in the Government’s report. It will examine this information at its next session, in the framework of the regular reporting cycle.

The Committee notes that the Government’s report does not contain a reply to the third point raised in its previous observation concerning collective bargaining in the public service (see 2004 observation, 75th Session). The Committee requests the Government to send its reply to this point in its next report which is due in 2006.

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The Committee notes with regret that the Government’s report does not contain a full reply to all of its previous comments and urges the Government to include, in its next report, full information on the following matters raised in its previous observations.

1. Noting a delay of a number of years, the Committee urged the Government to ensure that there were no further delays in repealing section 15 of the Industrial Relations Act (IRA), which limits the scope of collective agreements for companies granted "pioneer status", and requested a copy of the repealing legislation as soon as it was adopted. The Committee notes that the Government has provided no new information in this regard and it again requests that section 15 of the IRA be repealed in the near future and to keep it informed in this regard, including in relation to the progress of any repealing legislation currently in the draft stage.

2. The Committee had urged the Government to amend the legislation to bring section 13(3) of the IRA, which contains restrictions on collective bargaining in relation to transfer, dismissal and reinstatement (certain of the matters known as "internal management prerogatives"), into full conformity with Article 4 of the Convention. The Committee notes that the Government has provided no new information in this regard, and it again requests that section 13(3) of the IRA be amended to ensure that transfer, dismissal and reinstatement are not excluded from the scope of collective bargaining in Malaysia.

3. Noting that without detailed information it has not been in a position to determine whether genuine collective bargaining exists in the public service, the Committee had requested the Government to provide it with specific information on how collective bargaining is encouraged and promoted in practice between public employers and public servants and, in particular, on the number of employees covered and the specific issues discussed, as well as examples of the process that has been followed to reach specific collective agreements for public servants. The Committee had further requested the Government to indicate the steps taken or envisaged to bring section 52 of the IRA, which provides for certain restrictions on the right to bargain collectively for public servants, other than those engaged in the administration of the State, into conformity with the Convention.

The Committee notes the information provided by the Government in its report that the National Joint Council and Departmental Joint Council serve as the nationwide forum for information sharing, discussion and consultation between government/management and public sector employees, in a positive environment and concerning matters including consolidation of schemes of service, terms and conditions of service and improvements to the existing remuneration structure. The Committee further notes that the Government indicates its view that this is a better approach rather than granting full collective bargaining rights to public sector unions/employees. The Committee requests the Government to indicate in its next report whether any limitations exist in relation to the outcome of consultations within the National Joint Council and Departmental Joint Council as to the terms and conditions of service and remuneration structure, as well as the form and scope of any agreements reached.

The Committee recalls that under Article 6 of the Convention all public servants other than those engaged in the administration of the State should enjoy the guarantees of the Convention and therefore be able to negotiate collectively their conditions of employment (see General Survey on freedom of association and collective bargaining, 1994, paragraph 262), and that simple consultations do not satisfy the requirements of Articles 4 and 6 of the Convention.

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The Committee notes that the Government’s report does not contain a full reply to its previous comments. It hopes that the next report will include full information on the matters raised in its previous observation.

For a number of years the Committee has been commenting on the need to repeal section 15 of the Industrial Relations Act (IRA) which limits the scope of collective agreements for companies granted "pioneer status". Since 1994, the Government has indicated to the Committee that the provision was in the process of being repealed; however, the Committee notes that, according to the Government, the repealing legislation has been inadvertently delayed in order to accommodate other amendments to the Act, so that the Act could meet the rapidly changing work environment. Given that section 15 of the IRA constitutes a violation of Article 4 of the Convention, and that six years have passed since the Government indicated that the appropriate amendments would be made, the Committee urges the Government to ensure there are no further delays in repealing section 15, and to forward a copy of the repealing legislation as soon as it is adopted.

With respect to the Committee’s previous comments concerning the restrictions on collective bargaining contained in section 13(3) of the IRA, the Committee notes that the Government reiterates its view that issues pertaining to such things as transfer, dismissal and reinstatement essentially refer to individual rights which could not be predetermined in a collective agreement, since this would affect the rights of management to manage. The Committee must again recall that issues such as transfer, dismissal and reinstatement should not be excluded from the scope of collective bargaining. While a collective agreement would not normally deal with individual cases of transfer, dismissal and reinstatement, it should be possible to include for example, as is often found in the collective agreements in many countries, the general criteria and procedures concerning these issues. The Committee urges the Government to amend the legislation to bring section 13(3) into full conformity with Article 4 of the Convention.

A further provision of the IRA has also been a subject of comment for many years, namely section 52, which provides for certain restrictions on the right to bargain collectively for public servants, other than those engaged in the administration of the State. Lacking detailed information, the Committee has not been in a position to determine whether genuine collective bargaining exists in this sector or merely consultation. In this regard, the Government again points to the role of the national joint councils in providing an avenue for discussion and negotiation on terms and conditions of employment, including salaries, of public servants. While the Committee has in the past noted this information, it once more requests the Government to provide specific information on how collective bargaining is encouraged and promoted in practice between public employers and public servants. In particular, the Committee would welcome information on the number of employees covered, and the specific issues discussed. The Committee again requests the Government to provide this information as well as examples of the process that has been followed to reach specific collective agreements for public servants.

The Committee requests the Government to indicate in its next report the steps taken or envisaged to bring the abovementioned provisions into full conformity with the Convention.

The Committee hopes that the Government will make every effort to take the necessary action in the near future.

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1.  The Committee notes the information provided by the Government in its report, and the supplementary information forwarded.

2.  For a number of years the Committee has been commenting on the need to repeal section 15 of the Industrial Relations Act (IRA) which limits the scope of collective agreements for companies granted "pioneer status". Since 1994, the Government has indicated to the Committee that the provision was in the process of being repealed; however, the Committee notes that, according to the Government, the repealing legislation has been inadvertently delayed in order to accommodate other amendments to the Act, so that the Act could meet the rapidly changing work environment. Given that section 15 of the IRA constitutes a violation of Article 4 of the Convention, and that six years have passed since the Government indicated that the appropriate amendments would be made, the Committee urges the Government to ensure there are no further delays in repealing section 15, and to forward a copy of the repealing legislation as soon as it is adopted.

3.  With respect to the Committee’s previous comments concerning the restrictions on collective bargaining contained in section 13(3) of the IRA, the Committee notes that the Government reiterates its view that issues pertaining to such things as transfer, dismissal and reinstatement essentially refer to individual rights which could not be predetermined in a collective agreement, since this would affect the rights of management to manage. The Committee must again recall that issues such as transfer, dismissal and reinstatement should not be excluded from the scope of collective bargaining. While a collective agreement would not normally deal with individual cases of transfer, dismissal and reinstatement, it should be possible to include for example, as is often found in the collective agreements in many countries, the general criteria and procedures concerning these issues. The Committee urges the Government to amend the legislation to bring section 13(3) into full conformity with Article 4 of the Convention.

4.  A further provision of the IRA has also been a subject of comment for many years, namely section 52, which provides for certain restrictions on the right to bargain collectively for public servants, other than those engaged in the administration of the State. Lacking detailed information, the Committee has not been in a position to determine whether genuine collective bargaining exists in this sector or merely consultation. In this regard, the Government again points to the role of the national joint councils in providing an avenue for discussion and negotiation on terms and conditions of employment, including salaries, of public servants. While the Committee has in the past noted this information, it once more requests the Government to provide specific information on how collective bargaining is encouraged and promoted in practice between public employers and public servants. In particular, the Committee would welcome information on the number of employees covered, and the specific issues discussed. The Committee again requests the Government to provide this information as well as examples of the process that has been followed to reach specific collective agreements for public servants.

5.  The Committee requests the Government to indicate in its next report the steps taken or envisaged to bring the abovementioned provisions into full conformity with the Convention.

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The Committee notes the discussion that took place at the Conference Committee on the Application of Standards in June 1999.

The Committee notes with regret that the Government's report has not been received. It must therefore repeat its previous observation on the following matters:

1. Further to its previous comments, the Committee notes the Government's statement that section 15 of the Industrial Relations Act (IRA), which limits the scope of collective agreements for companies granted "pioneer status", is in the process of being amended and that a copy of the repealing legislation will be forwarded to the ILO as soon as it is passed by Parliament. The Committee recalls however that the Government has been referring to "positive measures to repeal section 15" since 1994, and would therefore request it to ensure that section 15 of the IRA is repealed shortly, and to provide a copy of the repealing legislation as soon as it is adopted. 2. The Committee had also referred to the restrictions on collective bargaining contained in section 13(3) of the IRA, with regard to certain matters known as internal management prerogatives (i.e. transfer, dismissal and reinstatement). The Committee considered that issues such as transfer, dismissal and reinstatement should not be excluded from the scope of collective bargaining. The Committee therefore requests the Government to indicate, in its next report, the steps taken or envisaged to bring section 13(3) of the IRA into conformity with Article 4 of the Convention. 3. In relation to the Committee's comments on certain restrictions on the right to bargain collectively for public servants other than those engaged in the administration of the State (section 52 of the IRA), the Committee would once again request the Government to provide specific information on how collective bargaining is encouraged and promoted in practice between public employers and public servants other than those engaged in the administration of the State, for example, by supplying information on the number of collective agreements concluded, the different categories and numbers of employees covered, the number of public sector unions acting as bargaining agents, etc.

The Committee asks the Government to provide information on all these points in its next report.

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The Committee notes the information supplied by the Government in its report.

1. Further to its previous comments, the Committee notes the Government's statement that section 15 of the Industrial Relations Act (IRA), which limits the scope of collective agreements for companies granted "pioneer status", is in the process of being amended and that a copy of the repealing legislation will be forwarded to the ILO as soon as it is passed by Parliament. The Committee recalls however that the Government has been referring to "positive measures to repeal section 15" since 1994, and would therefore request it to ensure that section 15 of the IRA is repealed shortly, and to provide a copy of the repealing legislation as soon as it is adopted.

2. In its previous comments, the Committee had referred to the restrictions on collective bargaining contained in section 13(3) of the IRA, with regard to matters known as internal management prerogatives (i.e. promotion, transfer, employment, termination, dismissal and reinstatement). The Government had indicated previously that such matters could not be predetermined in a collective agreement, as a predetermined agreement on such matters would ultimately affect the rights of management to manage. In addition, the Government had emphasized that internal management prerogatives did not grant unfettered rights to employers, as demonstrated by numerous decisions of the Malaysian courts. The Committee considers that while issues such as promotion, employment and termination could eventually be considered as matters for management decision-making as part of its freedom to manage the enterprise, the other issues, namely transfer, dismissal and reinstatement, should not be excluded from the scope of collective bargaining. The Committee therefore requests the Government to indicate, in its next report, the steps taken or envisaged to bring section 13(3) of the IRA into conformity with Article 4 of the Convention.

3. In relation to the Committee's comments on certain restrictions on the right to bargain collectively for public servants other than those engaged in the administration of the State (section 52 of the IRA), the Government indicates once again that the Congress of Unions of Employees in the Public and Civil Services (CUEPACS), the officers of the Joint Councils and the Public Services Department meet on a regular basis to discuss issues affecting employees in the public service. Through these discussions, the public sector unions do contribute to the deliberations on remunerations, terms and conditions of employment and the resolution of anomalies arising therefrom. The Government emphasizes that the National Joint Councils provide a sufficient avenue for discussion and negotiation on salary and terms and conditions of employment of public servants and that CUEPACS as a national centre for public servants, plays an important and responsible role in protecting the interests of public servants, including wage negotiation.

While taking note of this information, the Committee would once again request the Government to provide specific information on how collective bargaining is encouraged and promoted in practice between public employers and public servants other than those engaged in the administration of the State, for example, by supplying information on the number of collective agreements concluded, the different categories and numbers of employees covered, the number of public sector unions acting as bargaining agents, etc.

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The Committee notes that the Government's report has not been received. It must therefore repeat its previous observation which read as follows:

1. Further to its previous comments, the Committee notes the Government's statement that it has formally approved the proposed repeal of section 15 of the Industrial Relations Act, which limits the scope of collective agreements for companies granted "pioneer status", and that positive measures are being taken to repeal this provision. The Committee requests the Government to send a copy of the repealing legislation as soon as it is adopted. 2. With reference to the Committee's previous comments on the scope of section 13(3) of the Industrial Relations Act, the Government once again indicates that the matters excluded by that provision from collective bargaining and known as internal management prerogatives (i.e. promotion, transfer, employment, termination, dismissal and reinstatement), are subject to negotiation, conciliation, arbitration and judicial decisions and can be raised at any time as and when they arise, as opposed to other matters covered in collective agreements that are negotiated at specific intervals. Moreover, in the Government's view, such matters cannot be predetermined in a collective agreement, as a predetermined agreement on such matters would ultimately affect the rights of management to manage. In addition, the Government emphasizes that the internal management prerogatives do not grant unfettered rights to employers, as demonstrated by numerous decisions of the Malaysian Courts as follows: (i) an employer can refuse to promote a worker only for proper cause and the trade union that represents the worker is free under the law to raise questions as to what is and what is not proper cause; (ii) the employers' prerogative of transfer is not unlimited. The Courts had ruled that there should be no unreasonableness or want of mala fide on the part of the employer; (iii) termination by way of retrenchment could not be carried out arbitrarily. The principle of "last in, first out" had to be applied; (iv) unjust dismissal could entitle the worker to reinstatement; (v) to provide that matters such as allocation of duties be covered by collective agreement, would be tantamount to asserting that it is not the management which is responsible for managing the enterprise, which is contrary to the commonly accepted practice worldwide. The Committee notes with interest that there is a degree of judicial protection as regards these internal management prerogatives which also appear to be subject to some level of bargaining in practice. The Committee therefore requests the Government to take the necessary steps to ensure that its legislation no longer excludes those management prerogatives which are not purely internal from collective bargaining, in conformity with the Convention as well as with national practice and judicial precedents. 3. In relation to the Committee's comments on certain restrictions on the right to bargain collectively for public servants other than those engaged in the administration of the State (section 52 of the Industrial Relations Act), the Government indicates that the Congress of Unions of Employees in the Public and Civil Services (CUEPACS), the officers of the Joint Councils and the Public Services Department meet on a regular basis to discuss issues affecting employees in the public service. Through these discussions, the public sector unions do contribute to the deliberations on remunerations, terms and conditions of employment and the resolution of anomalies arising therefrom. For instance, in the current claims for salary adjustments, CUEPACS has had meetings with the Prime Minister, and through these meetings, some understanding has been arrived at. The Government emphasizes that the National Joint Councils provide a sufficient avenue for discussion and negotiation on salary and terms and conditions of employment of public servants and that CUEPACS as a national centre for public servants, plays an important and responsible role in protecting the interests of public servants, including salary negotiation. The Committee takes note of this information and would request the Government to provide information on how collective bargaining is encouraged and promoted in practice between public employers and public servants other than those engaged in the administration of the State, for example, the number of collective agreements concluded, the different categories and numbers of employees covered, the number of public sector unions acting as bargaining agents, etc.

The Committee hopes that the Government will make every effort to take the necessary action in the very near future.

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1. The Committee notes the information supplied by the Government in its reports as well as the detailed discussion which took place at the Conference Committee in June 1994.

Further to its previous comments, the Committee notes the Government's statement that it has formally approved the proposed repeal of section 15 of the Industrial Relations Act, which limits the scope of collective agreements for companies granted "pioneer status", and that positive measures are being taken to repeal this provision.

The Committee requests the Government to send a copy of the repealing legislation as soon as it is adopted.

2. With reference to the Committee's previous comments on the scope of section 13(3) of the Industrial Relations Act, the Government once again indicates that the matters excluded by that provision from collective bargaining and known as internal management prerogatives (i.e. promotion, transfer, employment, termination, dismissal and reinstatement), are subject to negotiation, conciliation, arbitration and judicial decisions and can be raised at any time as and when they arise, as opposed to other matters covered in collective agreements that are negotiated at specific intervals. Moreover, in the Government's view, such matters cannot be predetermined in a collective agreement, as a predetermined agreement on such matters would ultimately affect the rights of management to manage. In addition, the Government emphasizes that the internal management prerogatives do not grant unfettered rights to employers, as demonstrated by numerous decisions of the Malaysian Courts as follows: (i) an employer can refuse to promote a worker only for proper cause and the trade union that represents the worker is free under the law to raise questions as to what is and what is not proper cause; (ii) the employers' prerogative of transfer is not unlimited. The Courts had ruled that there should be no unreasonableness or want of mala fide on the part of the employer; (iii) termination by way of retrenchment could not be carried out arbitrarily. The principle of "last in, first out" had to be applied; (iv) unjust dismissal could entitle the worker to reinstatement; (v) to provide that matters such as allocation of duties be covered by collective agreement, would be tantamount to asserting that it is not the management which is responsible for managing the enterprise, which is contrary to the commonly accepted practice worldwide. The Committee notes with interest that there is a degree of judicial protection as regards these internal management prerogatives which also appear to be subject to some level of bargaining in practice. The Committee therefore requests the Government to take the necessary steps to ensure that its legislation no longer excludes internal management prerogatives from collective bargaining, in conformity with the Convention as well as with national practice and judicial precedents.

3. In relation to the Committee's comments on certain restrictions on the right to bargain collectively for public servants other than those engaged in the administration of the State (section 52 of the Industrial Relations Act), the Government indicates that the Congress of Unions of Employees in the Public and Civil Services (CUEPACS), the officers of the Joint Councils and the Public Services Department meet on a regular basis to discuss issues affecting employees in the public service. Through these discussions, the public sector unions do contribute to the deliberations on remunerations, terms and conditions of employment and the resolution of anomalies arising therefrom. For instance, in the current claims for salary adjustments, CUEPACS has had meetings with the Prime Minister, and through these meetings, some understanding has been arrived at. The Government emphasizes that the National Joint Councils provide a sufficient avenue for discussion and negotiation on salary and terms and conditions of employment of public servants and that CUEPACS as a national centre for public servants, plays an important and responsible role in protecting the interests of public servants, including salary negotiation.

The Committee takes note of this information and would request the Government to provide information on how collective bargaining is encouraged and promoted in practice between public employers and public servants other than those engaged in the administration of the State, for example, the number of collective agreements concluded, the different categories and numbers of employees covered, the number of public sector unions acting as bargaining agents, etc.

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1. Further to its previous comments, the Committee notes with interest the Government's indication in its report that it is actively considering repealing section 15 of the Industrial Relations Act, which limits the scope of collective agreements for so-called "pioneer enterprises" and others, and that a Cabinet paper was being prepared for the Government's consideration.

The Committee asks the Government to keep it informed on any further progress and to send a copy of the repealing legislation as soon as it is adopted.

2. The Committee notes the information supplied by the Government, in answer to its previous comments, on the scope of section 13(3) of the Industrial Relations Act. The Government again states that the matters excluded by that provision from collective bargaining (i.e. promotion, transfer, employment, termination, dismissal and reinstatement) have been subject to negotiation, conciliation and arbitration, as well as judicial decisions and that they amounted to 54.2 per cent of all disputes dealt with by the Department of Industrial Relations during the past five years. The Government also stresses that these matters, considered as internal management prerogatives, are subject to legal limitations.

The Committee understands, from the information available, that the matters referred to above are indeed commonly bargained and it therefore would ask the Government to take the necessary steps to lift the above-mentioned limitations in order to bring its legislation into line with the Convention and with wide national practice.

3. The Committee further notes, in relation to its comments on certain restrictions on the right to bargain collectively for employees in the public administration other than those engaged in the administration of the State (section 52 of the Industrial Relations Act) that the National Joint Councils, as set up in 1992, provide equal representation to workers' organizations and government officials, and that they meet at least twice a year. Meetings have been convened to discuss implementation problems of the "New Remuneration System". At the levels of ministries and departments, workers' organizations are represented in the Department Joint Councils, which are expected to meet five times annually to discuss and solve problems on public sector wages and employment.

While noting this information the Committee again asks the Government to encourage and promote the full development and utilization of machinery for voluntary negotiation between public employers and public servants other than those engaged in the administration of the State - such as teachers - with a view to the regulation of the terms and conditions of employment of the said workers.

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The Committee recalls its previous observations concerning inconsistencies between the national legislation and Article 4 of the Convention which covered the following points:

- limitations on the scope of matters open to collective bargaining (section 13(3) of the Industrial Relations Act, 1967);

- the prohibition from including in collective agreements for so-called "pioneer enterprises" and for any other industry which might be specified by the Minister, provisions that are more favourable than those contained in Part XII of the Employment Ordinance, 1955 (section 15 of the Industrial Relations Act); and

- restrictions on the right to bargain collectively for employees in public administration other than those engaged in the administration of the State (section 52 of the Industrial Relations Act).

In general, the Committee takes note of the Government's view that there should not be a legalistic or technical approach taken over the application of ratified Conventions in this era of increasing protectionism adopted by certain trading blocs and that the attempts by developing countries to develop their economies and eradicate poverty should be looked at in a positive light. Noting further that the Government undertakes to take appropriate measures to amend its laws as and when the political, economic and social conditions of the country warrant it, the Committee points out that the Government's aims would be assisted rather than obstructed by the functioning of a full and free system of collective bargaining, such as promoted by Article 4 of the Convention. Moreover, while aware of the various socio-economic pressures facing member States, the Committee would recall that it has always carried out its task of monitoring the application of ratified Conventions on the basis of the universality of standards, assessing the effect given to the obligations arising from ratification irrespective of the political, social or economic systems or level of development prevailing.

1. The Committee notes the information supplied in the Government's reports, in particular its comments that those areas listed in section 13(3) of the Industrial Relations Act are regarded as common law rights of employers which should not be the subject of negotiations because this could lead to prolonged strife since managers are unlikely to agree to any erosion of their rights during the process of negotiating a collective agreement. As in past reports, it stresses that workers and unions nevertheless can raise these issues with employers if employers exercise their rights unfairly or with mala fide, and can even raise them as trade disputes subject to conciliation proceedings and referral to the Industrial Court. The Committee notes with interest that according to the Government's report when disputes arose over dismissals of workers, retrenchments and layoffs, promotions, allocation of duties, transfers, demotions and other management prerogatives they were treated in the same manner as proposals for collective agreements are treated, namely through negotiations, conciliation and arbitration. The Committee is of the opinion that the legislative exclusion from bargaining of certain matters relating to conditions of employment (such as those in this case: promotion, transfer, appointment, dismissal and assignment of duties) is not compatible with Article 4 (General Survey, 1983, paras. 307 and 311). It accordingly again asks the Government to take steps to bring section 13 into line with the obligations arising under the Convention - and with its description of the actual practice concerning these issues which is equivalent to collective bargaining practices in Malaysia.

2. Regarding the Committee's comments on section 15 of the Industrial Relations Act, the Government states that the granting of pioneer status to certain industries is part of its various strategies within its macro strategy to promote investment, stimulate industrial growth and generate greater employment opportunities; it stresses that section 15 does not limit negotiations on monetary items (wages, allowances) but only on hours of work, holidays, annual leave and sick leave and this only for a period of five years. It points out that this is not a complete ban since the parties can negotiate more favourable terms in these industries and seek the approval of the Minister; he has to date never rejected any such request made to him. The Committee notes these various comments but indicates that this provision is contrary to the principles set forth in Article 4 which aims at voluntary collective bargaining free of the obligation of submitting concluded agreements to administrative authorities for approval (General Survey, paras. 308 and 311). Noting with interest that the Minister has never rejected an agreement which accords more favourable terms on these items, the Committee invites the Government once again to amend section 15's limitation on bargaining.

3. The Committee takes note of the Government's statements that the exclusion of public services from certain provisions of the Act is due to the differing objectives of the public and private sectors; public sector wage adjustments involve nearly 850,000 employees and can have serious implications on the government budget; the existence of the five national joint councils (NJCs) for the public service testifies to the fact that a form of negotiation and consultation is afforded to these employees which led, in 1989 and 1991, to significant pay rises. The Government adds that it has started privatising certain public enterprises, such as the Department of Telecommunications and the Electricity Board, following which the employees concerned can bargain collectively. Moreover, the NJCs will undergo a major review to suit the New Remuneration System for the public sector, to be implemented as of 1 January 1992. The Committee points out that the consultations in the NJCs are not sufficient since any resulting recommendations must be submitted for final approval to the Cabinet Committee and thus are out of the hands of the bargaining parties. Since, in the Committee's opinion, this system does not fully afford employees who are not in the category of public servants covered by Article 6 of the Convention the right to bargain, it would ask the Government to ensure that the public servants not engaged in the administration of the State (such as those serving in public utilities) enjoy the right fully to negotiate their terms and conditions of employment - just as private sector employees do. It also recalls that any concerns as to the cost implications of such bargaining could be addressed through persuading the parties to have regard voluntarily to major economic and social policy considerations and the general interest, so that persuasion is used rather than constraint (General Survey, para. 313). In this connection the Committee asks the Government to supply information in its next report on the implementation of the New Remuneration System for the public sector. The Committee draws the Government's attention to the fact that the Office is at its disposal for any technical assistance that it may wish to request in relation to these three long-standing matters.

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The Committee notes with regret that the Government's report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its previous direct request.

Further to the conclusions of the Committee on Freedom of Association in Case No. 1380 (248th Report of the Committee, March 1987), the Committee of Experts requested the Government to supply information on the role of the Registrar in the procedure for recognising a trade union for collective bargaining purposes.

The Committee notes the information supplied by the Government in its last report concerning the procedure for the registration of trade unions that is established by the Trade Unions Act of 1959.

However, referring to the recognition procedure for the purposes of collective bargaining regulated by the Industrial Relations Act of 1967 (sections 9 to 12), the Committee notes that the Director-General and the Minister responsible have discretionary powers to decide whether to grant recognition in the event of an employer refusing to recognise a trade union as a bargaining agent.

The Committee considers that, where systems provide for the most representative trade union to have preferential or exclusive bargaining rights, it is important that the determination of the trade union in question should be based on objective and pre-established criteria, so as to avoid any opportunity for partiality or abuse. It has also suggested that, where national legislation provides for a procedure of certifying unions as exclusive bargaining agents, certain safeguards should be provided, such as: (a) the certification to be made by an independent body; (b) the representative organisation to be chosen by a majority vote of the employees in the unit concerned; (c) the right of an organisation which fails to secure a sufficiently large number of votes to ask for a new election after a stipulated period; (d) the right of any organisation other than the certificated organisation to demand a new election after a reasonable period has elapsed, otherwise a majority of the workers concerned might belong to a union which, for an unduly long period, could be prevented from organising its administration and activities with a view to fully furthering and defending the interests of its members. (See General Survey, 1983, paragraph 295.)

The Committee requests the Government to consider amending its legislation in the light of the above considerations and to supply information on any progress achieved in this respect.

In addition, the Committee asks the Government to indicate whether workers employed in export processing zones are accorded the right to engage in collective bargaining.

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The Committee notes with regret that the Government's report has not been received. It must therefore repeat its previous observation which read as follows:

The Committee recalls that its comments concerned a number of provisions of the Industrial Relations Act of 1967: - the exclusion from collective bargaining of matters concerning promotion, transfers, recruitment, dismissal without notice, the assignment of jobs (section 13(3) of the Industrial Relations Act of 1967, as amended in 1980); - the prohibition from including, in collective agreements for so-called "pioneer enterprises" and in all other enterprises specified by the Minister, provisions that are more favourable than those contained in Part XII of the Employment Ordinance, 1955 (section 15 of the Act); - restrictions on the right to bargain collectively for employees in public administrations other than those engaged in the administration of the State (section 52 of the Act). 1. Restrictions on the scope of collective bargaining. With regard to section 13(3), in its previous observation the Committee noted that, according to the information supplied by the Government, the matters excluded by virtue of the Act from the scope of collective bargaining were in fact negotiated. The Committee suggested that the Government could repeal this provision in order to bring its legislation into accordance with its practice and with the Convention on this point. In its last report, the Government indicates that, within the framework of its industrial development policy, the objective of which is economic growth, employment must be able to develop without undue hinderances. It adds that, rather than withdrawing the legal restrictions regarding collective bargaining, it is for the social partners to remove these restrictions through collective negotiation. It also states that the Act gives the opportunity to negotiate questions of a general nature concerning the procedure of promotions and that in the event of refusal by an employer, a trade union may make representations to the Minister. With regard to section 15 of the Act of 1967, which, according to the Government, is only a reserve provision to protect the so-called "pioneer enterprises", the Committee notes the Government's statement in its last report to the effect that this provision is one of the measures that it has taken to promote investment, that it furthers industrial growth and employment and that it is essential in view of the cutback in public expenditure and the emphasis given to the development of the private sector. The Committee once again points out that, even though collective bargaining may in practice cover matters excluded under the 1967 Act by section 13, and that section 15 of the 1967 Act only concerns newly constituted enterprises for a period of five years, giving their workers the minimum employment conditions established by law, these provisions nevertheless are contrary to the principles set forth in Article 4 of the Convention which lays down that measures shall be taken to encourage and promote the full development and utilisation of machinery for voluntary negotiation with a view to the regulation of terms and conditions of employment by this means. It therefore requests the Government to supply information in its next report on the measures that have been taken or are envisaged in order to remove the restrictions on collective bargaining contained in the law. 2. With regard to the restrictions on the right to bargain collectively of employees in public administrations, the Government indicates that it is not entirely true that these employees cannot bargain collectively since five National Joint Councils provide them with this opportunity. The Government adds, in this connection, that for five years serious negotiations have taken place within these councils and have resulted in a substantial wage rise for civil service employees. The Committee notes this information, but points out that although discussions have taken place in National Joint Councils, their recommendations, and those of the salary commissions (which may be re-examined by the Public Service Tribunal), are submitted for approval to the Cabinet Committee, which makes the final decision. In the Committee's opinion, this system does not fully afford employees in public administrations who are not in the category of public servants covered by Article 6 of the Convention, the right to negotiate collectively their terms and conditions of employment as set out in Article 4 of the Convention. The Committee once again requests the Government to take steps to grant employees in public administrations other than public servants engaged in the administration of the State the right to negotiate collectively, without the intervention of the public authorities.

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The Committee hopes that the Government will make every effort to take the necessary action in the very near future.

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Further to the conclusions of the Committee on Freedom of Association in Case No. 1380 (248th Report of the Committee, March 1987), the Committee of Experts requested the Government to supply information on the role of the Registrar in the procedure for recognising a trade union for collective bargaining purposes.

The Committee notes the information supplied by the Government in its last report concerning the procedure for the registration of trade unions that is established by the Trade Unions Act of 1959.

However, referring to the recognition procedure for the purposes of collective bargaining regulated by the Industrial Relations Act of 1967 (sections 9 to 12), the Committee notes that the Director-General and the Minister responsible have discretionary powers to decide whether to grant recognition in the event of an employer refusing to recognise a trade union as a bargaining agent.

The Committee considers that, where systems provide for the most representative trade union to have preferential or exclusive bargaining rights, it is important that the determination of the trade union in question should be based on objective and pre-established criteria, so as to avoid any opportunity for partiality or abuse. It has also suggested that, where national legislation provides for a procedure of certifying unions as exclusive bargaining agents, certain safeguards should be provided, such as: (a) the certification to be made by an independent body; (b) the representative organisation to be chosen by a majority vote of the employees in the unit concerned; (c) the right of an organisation which fails to secure a sufficiently large number of votes to ask for a new election after a stipulated period; (d) the right of any organisation other than the certificated organisation to demand a new election after a reasonable period has elapsed, otherwise a majority of the workers concerned might belong to a union which, for an unduly long period, could be prevented from organising its administration and activities with a view to fully furthering and defending the interests of its members. (See General Survey, 1983, paragraph 295.)

The Committee requests the Government to consider amending its legislation in the light of the above considerations and to supply information on any progress achieved in this respect.

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The Committee notes the Government's report and recalls that its comments concerned a number of provisions of the Industrial Relations Act of 1967:

- the exclusion from collective bargaining of matters concerning promotion, transfers, recruitment, dismissal without notice, the assignment of jobs (section 13(3) of the Industrial Relations Act of 1967, as amended in 1980);

- the prohibition from including, in collective agreements for so-called "pioneer enterprises" and in all other enterprises specified by the Minister, provisions that are more favourable than those contained in Part XII of the Employment Ordinance, 1955 (section 15 of the Act);

- restrictions on the right to bargain collectively for employees in public administrations other than those engaged in the administration of the State (section 52 of the Act).

1. Restrictions on the scope of collective bargaining. With regard to section 13(3), in its previous observation the Committee noted that, according to the information supplied by the Government, the matters excluded by virtue of the Act from the scope of collective bargaining were in fact negotiated. The Committee suggested that the Government could repeal this provision in order to bring its legislation into accordance with its practice and with the Convention on this point.

In its last report, the Government indicates that, within the framework of its industrial development policy, the objective of which is economic growth, employment must be able to develop without undue hinderances. It adds that, rather than withdrawing the legal restrictions regarding collective bargaining, it is for the social partners to remove these restrictions through collective negotiation. It also states that the Act gives the opportunity to negotiate questions of a general nature concerning the procedure of promotions and that in the event of refusal by an employer, a trade union may make representations to the Minister.

With regard to section 15 of the Act of 1967, which, according to the Government, is only a reserve provision to protect the so-called "pioneer enterprises", the Committee notes the Government's statement in its last report to the effect that this provision is one of the measures that it has taken to promote investment, that it furthers industrial growth and employment and that it is essential in view of the cutback in public expenditure and the emphasis given to the development of the private sector.

The Committee once again points out that, even though collective bargaining may in practice cover matters excluded under the 1967 Act by section 13, and that section 15 of the 1967 Act only concerns newly constituted enterprises for a period of five years, giving their workers the minimum employment conditions established by law, these provisions nevertheless are contrary to the principles set forth in Article 4 of the Convention which lays down that measures shall be taken to encourage and promote the full development and utilisation of machinery for voluntary negotiation with a view to the regulation of terms and conditions of employment by this means.

It therefore requests the Government to supply information in its next report on the measures that have been taken or are envisaged in order to remove the restrictions on collective bargaining contained in the law.

2. With regard to the restrictions on the right to bargain collectively of employees in public administrations, the Government indicates that it is not entirely true that these employees cannot bargain collectively since five National Joint Councils provide them with this opportunity. The Government adds, in this connection, that for five years serious negotiations have taken place within these councils and have resulted in a substantial wage rise for civil service employees.

The Committee notes this information, but points out that although discussions have taken place in National Joint Councils, their recommendations, and those of the salary commissions (which may be re-examined by the Public Service Tribunal), are submitted for approval to the Cabinet Committee, which makes the final decision. In the Committee's opinion, this system does not fully afford employees in public administrations who are not in the category of public servants covered by Article 6 of the Convention, the right to negotiate collectively their terms and conditions of employment as set out in Article 4 of the Convention.

The Committee once again requests the Government to take steps to grant employees in public administrations other than public servants engaged in the administration of the State the right to negotiate collectively, without the intervention of the public authorities.