TOPIC 3

TRADE UNIONS
 LEARNING OBJECTIVES:

At the end of this chapter, students should be able to:

1) Define the term ‘trade unions’ from Trade Unions Act
1959 and its implications
2) Explain the objectives of trade union
3) Identify possible reasons for joining trade union and
ways to create non-union environment
4) Discuss the types and categories of trade unions
 DEFINITION OF TRADE
UNION

An association or workers/employers set up within

particular trade, occupation or industry (TOI) to:
1) Protect right of workers (members)
2) Improve terms and conditions at the workplace.
DEFINITION – TRADE UNION
ACT 1959 (SEC. 2)

 Any association or combination of workmen or

employers whose workplace is in West Malaysia, Sabah
or Sarawak, as the case may be, or employers employing
workmen in Malaysia, Sabah or Sarawak, as the case
maybe:
 Within any particular establishment, trade, occupation or
industry or within similar trades, occupations or industries: and
 Whether temporary or permanent
 IMPLICATIONS OF THE
DEFINITION

 Name – not necessarily called union, some known as association

 Membership – limited geographically
 Nature of union –union in general nature not permitted
 Right to join union – both employees and employers can join
union
 Responsibilities - any organization or group of workers
established to achieve one or more objective stated in the act is
considered having formed trade union and must conform to the
legislative requirements
 OBJECTIVES OF TRADE
UNIONS (Sec. 2 TUA)
i) the regulation of relations between workmen and employers, for the
purposes of promoting good and harmonious industrial relations between
workmen and employers, improving the working conditions of workmen or
enhancing their economic and social status, or increasing productivity;
a) the regulation of relations between workmen and workmen, or
between employers and employers;
ii) the representation of either workmen or employers in trade disputes;
a) the conducting of, or dealing with, trade disputes and matters related
thereto; or
iii) the promotion or organisation or financing of strikes or lock-outs is
any trade or industry or the provision of pay or other benefits for its
members during a strike or lock-out;
 REASONS FOR JOINING TU

1) Economic motive
2) Social reasons
3) Influence the decision-making and policy making.
4) Prevent exploitation and unfair action.
5) Pressure from present union members.
 CREATING A NON-UNION
ENVIRONMENT

Some companies are proactive in their attempts to prevent their

workers from joining trade unions. The positive steps to reduce or
eliminate the need of workers to join trade union such as:
pay higher wages and give better benefits
involve employees in all levels of decision making
offer training, development and a measure of security of tenure
develop climate of trust and loyalty in the organisation
 TYPES OF UNION

1) Public sector employees’ union

2) Private sector employees’ union
3) Employer’s union
 TYPES OF UNION IN MALAYSIA
Trade Unions

Employees’ Employers’
union union

Peninsular
Sabah Sarawak
Malaysia

Government Statutory
Bodies/local Private sector
sector
authorities

Particular Particular Particular/ Particular/

Particular/ Particular
department ministry similar similar
similar trade occupation enterprise
industry

Particular Statutory
Bodies/local
authorities
 Public Sector Employees Union

 Consist of the civil service, the statutory bodies and the local authorities.
 TUA provides that workers in the public sector can only form and join
unions whose members are in the same ministry, department or occupation.
 Not involved in collective bargaining
 Wages and other terms of services are discussed at the national level
between government and CUEPACS
 E.g:
National Union of the Teaching Profession
Malayan Nurses Union
Malayan Technical Services Union
Dental Technician Union
 PRIVATE SECTOR UNIONS

 There 2 types of private sector unions:

a) National Union
b) In-house union

a) National Union
- cover all the workers in the same TOI.
- the larger union have a sophisticated structure with regional branches
and local/plant level committees.
- large coverage – not necessarily depends on the number of membership
– but – depend on the number of potential members and the degree of
success of the union officers in persuading these potential members to
join TU.
-eg: National Union of Plantation Workers (NUPW) and National Union
of Commercial Workers
b) In-house Union
 involves a separate union for each company or enterprise
irrespective of the category of TOI (comprise workers who work for the
same employer).
 the govt believes in-house union is more likely to be a appreciative
of the situation in their workplace and problems of their employer.
 the close relationship will lead to peaceful IR and higher levels of
productivity.
 they may be directly controlled by the employer who provides them
with financial help, physical facilities, and representatives of
management will be involved in running the union.
 Eg. Malaysian Airline Employees Union and Telekom Berhad
Employees Union
 Advantages of In-house Union
1) Better management union relations because no interference from
outsiders.
2) In-house union has more understanding of company’s needs and
workplace problems rather than a full-time union official of a
nation wide occupational union.
3) Closer relationship between employer and the union lead to
peaceful IR
4) They feel in-house union leaders are more likely to adopt a
cooperative rather than a confrontational approach to negotiations
with management.
 Disadvantages of in-house union

1) In-house union are generally weak because membership is limited

and confined to workers in one particular company.
2) The leadership of such unions must be chosen from the small
number of members which may give rise to the possibility of the
employer trying to exploit such leader.
3) The union’s financial strength will not enable it to carry out its
normal trade union activities.
4) Fear of victimization among union leaders, particularly in relation
to promotions, termination of employment, transfers and
assignment of duties which are management prerogatives.
5) In-house unions with small memberships will be unable to provide
scholarships and other benefits for their members.
Examples of Employees’ TU in Malaysia

o National Union of Teaching Profession

o Telekom Employees Union
o Tenaga Nasional Employees Union
o Electrical Industry Workers Union
o National Union of Bank Employees
o National Union of Plantation Workers
o National Union of Commercial Workers
o Malayan Nurses Union
o Metal Industry Employees Union
o Sarawak Teachers Union
EMPLOYER’S UNION

 Members must be from the same trade, industry or occupation

 Objectives:
 To promote and protect interest of members
 To negotiate and deal with employees’ trade union
 To represent in trade dispute
Examples of Employers’ TU in Malaysia

 Malayan Agricultural Producers’ Association (MAPA)

 Commercial Employers’ Association of Peninsular Malaysia
 Malayan Commercial Banks’ Association (MCBA)
 Association of Insurance Employers (AIE)
 Association of Hotel Employers, Peninsular Malaysia
CONGRESS OF UNIONS OF
EMPLOYEES IN THE PUBLIC AND
CIVIL SERVICE (CUEPACS)
 It is a federation of trade unions of government workers
 Spokesman for the public service workers
 Objectives:
 To promote the interest and improve the working of its affiliate trade
union
 To protect the interests of the affiliate trade union and their members
 To endeavour to improve the conditions of employment of the members of
the affiliate trade unions; and
 To promote legislation affecting the interest of the member unions in
particular or trade unionists in general
 MALAYSIAN TRADE UNION
CONGRESS (MTUC)
 A federation of trade unions and registered under the Societies Act,1955
 The unions affiliated to MTUC represent all major industries and sector with
approximately 500,000 members
 Objectives:
 providing advisory service to its members
 present the labour viewpoint to the government
 presenting workers' views on national issues eg: development and education
 help to organise workers who do not belong to a union
 represent Malaysian labour movement at forums abroad
 provide trade union education
 carry out research on matters of trade union interest
 MALAYSIAN EMPLOYERS
FEDERATION

 It is the employer's equivalent to MTUC

 Objectives:
 to secure the organisation of employers
 to coordinate and present the opinions of the employers on labour matters
 to promote, protect and defend the interest of employers in general
 to inform and advise members on the implementation of the labour laws
 to advise members on the settlement of trade disputes
LEARNING OBJECTIVES

Student should be able to:

Identify the composition of trade unions
Explain formation, registration and
deregistration of trade union
Discuss immunity, liability and rights of trade
union
 COMPOSITION OF TRADE
UNIONS

 Workers in Malaysia have the right to form and join trade

unions. (Sec 5 of IRA)
 Who can join a union?
 Any worker over 16 years of age. However, union members
under 18 years of age are restricted in their union activities. And
union under age of 21 years are not eligible to be elected as
officers of the union
 Students cannot join union unless they are bona fide workers
and over the age of 18
 Rules of membership of TU in the public sectors:
 Staff in civil service can only join union which represent workers in the
same occupation, department or ministry
 Police, prison service and the Armed Forces and those in the confidential
and security work- are not allowed to join union
 Employees in the professional and managerial group also cannot join
union unless they are exempted by the Chief Secretary to the
Government
 Conditions to be fulfilled [TUA 10(1)(2)]
1. Applications made to the DGTU in prescribed form and prescribed
fees.
2. It must be signed by at least seven members.
3. The application must be accompanied with a printed copy of the
rules or constitution of union
4. Application must include :
1. name of the union and its address;
2. name, address and occupations of members making the application
3. titles, names, ages, addresses and occupation of union's officer and
any other information regarding the officers DGTU may require
REGISTRATION & MANAGEMENT
OF TRADE UNION
TUA 12(1)(2)
 DG can register or refuse to register a TU.

TUA 13
 DG shall issue a certificate of registration.

TUA 14
 DG can call for further particulars

TUA 71A
 Appeal can be made to the Minister and his decision is “final and conclusive”.

27
Section 10 Application for Registration (Conditions)
• It must be in a prescribed form.
• It must accompanied by prescribed fee.
• It must be signed by at least 7 members of the union.
• It must be accompanied by a printed copy of the rules of the union
signed by the members making the application.
• It must specify:
- titles, names, ages, addresses and occupation of the applicants.
- name of the TU and the addresses of its head office.
DIRECTOR GENERAL’S
POWER TO REFUSE REGISTRATION
Section 12 (2) & (3) TUA
 Duplication - The Director General may refuse to
register a trade union in respect of a particular
establishment, trade, occupation or industry if he is
satisfied that there is in existence a trade union
representing the workmen in that particular
establishment, trade, occupation or industry and it is
not in the interest of the workmen concerned that there
be another trade union in respect thereof.
 Other reasons – opinion of DG
a) Trade union is likely to be used for unlawful purposes –
inconsistent with objects and rules
b) Objects of the trade unions is unlawful
c) DG is not satisfied that trade union has complied with the
Act and regulation
d) DG is satisfied that objects, rules and constitution of the
trade union conflict with any of the provision of the Act or of
any regulations
e. Name of trade union to be registered:
 Identical to an existing trade union or nearly resembles the name
of such other trade union as, in the opinion of the Director
General, is likely to deceive the public or the members of either
trade union
 Undesirable, unless the trade union alters its name to one
acceptable to the Director General.
DIRECTOR GENERAL’S POWER TO
DE-REGISTER A TRADE UNION
Section 15. Cancellation of registration.

a) at the request of the trade union upon its dissolution to be

verified in such manner as the Director General may require;
or
b) if DG is satisfied-
 that the certificate of registration was obtained or issued by
fraud or mistake;
 that any one of the objects or rules of the trade union is
unlawful;
 the constitution of the trade union or of its executive is unlawful;
 the union has been or is being or is likely to be used for any unlawful
purposes or for any purpose contrary to its objects or rules;
 the trade union has contravened any provision of this Act or of any
regulations made there under, or of any of its rules, or allowed any rule to
continue in force which is inconsistent with any such provision, or
 the trade union has rescinded any rule providing for any matter for which
provision is required by First Schedule (section 38) of the Act;
 RESPONSIBILITIES OF TRADE
UNION
 To comply with all laws, particularly the provision of Trade
Union Act
 To deter any of its members from carrying out any illegal acts,
e.g. strikes, go-slow, boycotting of overtime
 To administer the funds of the union in proper manner as in union
rules
 Not to commence, promote or organize any strike or any other
forms of industrial actions without first obtaining the consent by
secret ballot of at least two thirds of its members who are entitle
to vote
IMMUNITY, RIGHT AND
LIABILITIES OF TRADE UNIONS
(PART IV S20 -25A)

 TU shall not enjoyed any rights, immunities or privileges of

registered trade union if it is not registered. (Sec 20 TUA)
 IMMUNITY OF TRADE UNION
(PART IV, TUA – S21)
IMMUNITY IN CIVIL SUIT IN CERTAIN CASES
According to Trade Unions Act, 1959 section 21- No suit or other
legal proceeding shall be maintainable in any civil court against any
registered trade union or any officer or member thereof in respect of
any act done in contemplation or in furtherance of a trade dispute –
unless such act:
 induces some other person to break a contract of employment, or
 that it is an interference with the trade, business or employment of
some other person or
 with the right of some other person to dispose of his capital or of his
labour as he wills.
 Trade union immunities are the legal protection from civil action for
trade union taking lawful strike action in furtherance of an industrial
dispute.
 Immunity is restricted to trade disputes between employer and
employees concerning the term and conditions of employment.
 Without immunity, employers could take legal action against unions
every time they caused employees to breach their contract of
employment.
 To get immunity, the strikes must be officially carried out by a
registered trade union and follow the strikes action procedures as
stipulated in the labour law (ie; IRA 1967).
LIABILITY OF TRADE UNION
(PART IV, TUA – S22)
 Liability in tort
 Suit against trade union and its members against tortious
act shall not be entertained by any court.

 A tort is the basic common law cause of action where one

individual has unlawfully harmed another.
 Sec 22 (2) – A union, its trustees and officials is not liable for
torts done involving specific property or rights of a trade union
or its usage; if it is in the contemplation or furtherance of trade
dispute.
 The TU Act 1959 gave protection to trade unions against any suit filed in
court, even if, the union representative had defamed the other party (the
employer).
 Example:
 Maybank filed the suit on April 22, 2011, claiming that Solomon, acting on his
own behalf and Nube, had in February or March this year published articles
containing defamatory statements of the company on the Nube website. The
court was satisfied that there was in fact a “trade dispute” between Maybank and
NUBE in reference to the insufficient bonuses provided for the lower level of
staff of the bank. Under Trade Union Act of 1959 Section 21 and 22 (1) it was
clear that such actions against a trade union in relation to a trade dispute “is not
maintainable in any civil court or be entertained by any court”.(Borneo Post,
Nov 25, 2011)
LIABILITY OF TRADE UNION
(PART IV, TUA – S23)

Liability in contract
Sec 23 of TU Act 1959 -Trade union shall be liable on any contract
it entered and not liable on contract which is void or unforceable at
law
Objects in restrain of trade – is not deemed to be unlawful
•Under Section 24, the objects of a registered trade union shall
not, by reason only that they are in restraint of trade be deemed
to be unlawful so as to render any member of such trade union
liable to criminal prosecution for conspiracy or otherwise or to
render void or voidable any agreement or trust.
STATUTORY RIGHTS OF
TRADE UNION
1) Legal action
 Section 25 (1) of TUA, a union may sue and be sued under its
registered names
 Section 25 (2) of the same Act specified that an unregistered union
can be charged under the name it used or the name it is referred to.

2) Execution of money in civil proceedings

 Section 25 (4) of TUA, the execution for any money recovered from
a trade union in civil proceedings may issue against any property
belonging to or held in trust for the trade union other than the
benevolent fund of a registered trade union.
3) Fines imposed on the union
 Section 25(5) of the Trade Unions Act provides that any fines
imposed and be born by the union, can be derived from the sales of
its movable properties or any monetary held under its trust fund in
accordance with the related criminal procedure.

4) Representation in court proceeding

 Section 25(6) of the Trade Unions Act, clarifies a trade union must
appear in any civil or criminal proceeding which to be represented
by its executive, solicitor or advocate.
5) Industrial action
 As stipulated in the Trade Unions Act, 1959 (Section
25A), both trade union of employee and employer alike
can take actions to stop a trade by launching legal strike
and lock out.