Human resources management (HRM) and industrial relations

Executive SummaryEmployment Relations encompasses the varied methods and processes of people management, including human resources management (HRM) and industrial relations. The Employment Relations field includes rules, attitudes, customs, practices, policies and behavior in and around the employment relationship. The main 'actors' in the field are employees and the organizations, employers and their associations, and the state and its institutions involved in employment issues. (Adapted from Bamber, G. , Park, F. , Lee, C. , Ross, P. and Broadbent, K. , 2000, "Employment Relations in the Asia Pacific: Changing Approaches", 1st Edition, Thomson Learning (Australia)The purpose of this assignment is to analyze the roles of tripartite in Malaysia. In this assignment, it mainly focuses on the types of roles played by the government, unions and management. In government, it will focus on the 3 major roles, which are legislator, administrator and participant. In trade unions, it will emphasize on the Malaysian Employment Federation and also the rules of strikes.

While in management, it will focus on the type of management theories, managerial styles and also the roles of Malaysian Employment Federation and National Chamber of Commerce and Industry of Malaysia roles played in the management in Malaysia industrial relations. Table of ContentPage1. Introduction of Malaysia Industrial Relations 12. Collective Bargaining 23. The Role of Government in Malaysia Industrial Relations 33. 1 Legislator 3 – 43. 2 Administrator 43. 3 Participant 54. The Role of Union in Malaysia Industrial Relations 5 – 75.

Introduction of Malaysia

Industrial RelationsMalaysia was a colony of Britain and as such as a parliamentary democracy modeled after the British system. The presence of three main ethnic groups (See appendix Figure 1) has been the cause of ethnic tension and Malaysia has developed a number of social and economic policies to ensure the continued prosperity and power for the indigenous Malay people (Sharma 1996).

In Malaysia, Industrial Relations is the preserve of the Federal Government and not of the State Government, as stipulated by the Malaysian Constitution. Malaysia has a tripartite of system Industrial Relations. At the national level, the Federal Government is empowered to make decisions on policies and legislation with advice from trade unions and employers. For instance, the National Labour Advisory Council is a forum to ensure the Federal Government receives input and feedback concerning both the employers and employee's viewpoints.

Tripartism also extends to a number of other bodies such as the Wage Council, the Industrial Court, Employer's Provident Fund, the Social Security Organization and the National Productivity Council. The Federal Government is responsible for the legislation and administration and participation of Industrial Relations system throughout Malaysia. (Page 1)2. Collective BargainingEven though Malaysia has a tripartite system of employment relations, however, the power of balance with this tripartite system is far from what could be considered equal.

Malaysia whilst at different stages of this industrial transformation, where it wish to attract foreign investment and, consequently, its respective political systems have worked to control unions and maintain labour participation at a level that will encourage the investment. Malaysia government policy has been subordinate the labour movement and guide trade unionism to the broader consideration of national economic development such as defined by ruling elite (Bean 1994, p. 219). This includes the passing of a succession of anti-labor laws in order to facilitate the strategy of national capital accumulation (Wad 1988).

The Malaysian system of industrial relations in the private sector are closely controlled by the state: the freedom of unions to organize and bargain are severely restricted and the industrial relations rules and regulations clearly reflect the state's efforts to contain industrial conflict in the interests of economic development (Verma et al. 1995, p. 167). (Page 2)3. The Role Of Government in Malaysia Industrial RelationsGovernment has a dominant role in employment relations through its restrictive legislation.

In Malaysia, government plays 3 major roles in industrial relations in Malaysia, which are legislator, administrator, and participant. 3. 1 LegislatorThere are several legislation classes that are grouped which affect the industrial relations such as:i)Legislation on employmentThe principal laws in this class are Employment Act 1955, the Sabah Labour Ordinance 1949 and the Sarawak Labour Ordinance 1952. These laws regulate employer-employee relations and legislate basic terms and conditions of employment in Malaysia.

ii)Legislation on trade unionsTrade Unions Act 1959 requires the registration of trade unions and union federations, governs their composition and membership, details the rights, powers, duties and responsibilities, and provides generally for the supervision by the State. (Page 3)iii)Legislation on industrial relationsIndustrial Relations Act 1967 regulates relations between employers, employees and the trade unions, and provides for the prevention and settlement of any differences or disputes arising between the employer-employees, including trade disputes.

iv)Safety and Health LegislationThe purpose of the Occupational Safety and Health Act 1994 is to secure the safety, health and welfare of a person at work, to protect persons at a place work, and to promote an occupational environment for persons at work. 3. 2 AdministratorThe Ministry of Human Resources is responsible for the administration of the legislation affecting industrial relations.

The basic objectives of the Ministry of Human Resources are; (i) to enforce the labour standards prescribed by the laws and regulations, (ii) to generate employment opportunities for citizens and regulate the employment of non-citizens, (iii) to equip the unemployed with the basic industrial skills and to enhance the skill level of the labour force, (iv) to foster good employer-employee relations and to promote sound industrial relations, and (v) to ensure safety, health and welfare of employees.

These objectives are carried out through activities such as enforcement of various laws and regulations, the inspection of places of employment, the provision of appropriate facilities and services, and the collection and dissemination of data and other information. (Page 4)3. 3 ParticipantThe National Labour Advisory Council (NLAC) is the most important forum established where it objective is to provide regularly constituted machinery for the Minister of Human Resources to obtain advice, views or consensus on matters pertaining to labour and manpower.

The NLAC is empowered to form committees for the purpose carrying out specific functions. The proceedings of the NLAC, including the proceedings of its committees, are confidential and cannot be communicated to the press or given any publicity without the prior approval of the chairman of the council. The Code of Conduct of Industrial Harmony (CCIH) is aim to lay down principles and guidelines to employers and employees on the practice of industrial relations for achieving greater industrial harmony. 4.

The Role of Unions in Malaysia Industrial RelationsA trade union is the basic organization of the workers, by the workers and for the workers designed to improve the workers' economic and other interest within the framework of employee-employer relationship. In Southeast Asian standards, the trade union movement in Malaysia is quite strong. Malaysian trade unionism indicates that public policies played an important role in shaping direction. (Page 5)Most public-sector unions belong to the Congress of Unions of Employees in Public and Civil Serv (CEUPACS), which, prior to 1980, was affiliated, with the Malaysian Trade Union Congress (MTUC).

The MTUC is a federation of trade unions and registered under the Societies Act, 1955. It is the oldest National Centre representing the Malaysian workers. The Unions affiliated to MTUC represent all major industries and sector with approximately 500,000 members. (See appendix figure 4)Private sector employers in Malaysia are represented in the central organization known as the Malay employers Federation (MEF). The MEF advises its members on how to deal with trade union claims, help prepare counter-proposals, and assists in negotiations of collective labour agreements.

It also represents employers on tripartite bodies such as the National Joint Labour Advisory Council and the Wages Council. In Malaysia, trade unions have the right to strike provided that two-thirds majority vote of the members entitled to vote is obtained. The results of the ballots must be filed with the Registrar of Trade Unions, only seven days after which a lawful strike may be held. Strikes inspired by political purposes or sympathy for other workmen are unlawful, and workmen engaged in essential services are permitted to strike only if their employer is not notified at least 21 days in advance. (Page 6)

Since the Registrar of Trade Unions is vested with the power to deregister labour organizations, it has become very difficult for workers to carry on any organized protest. Furthermore, strikes cannot legally take place when a recognition dispute is referred to the Industrial Court. Additionally, as the organized sector is very small, large majority of workers cannot exercise the right to strike. 5. The Role of Management in Malaysia Industrial RelationsManaging the employment relationship is one aspect of management role.

The basic goals of management can be seen as obtaining and retaining market share and running an efficient operation that produces a profit for owners and/or shareholders. The types of management theories where most management in Malaysia organization focused on are scientific management/taylorism where all employees should be studied and placed in and/or trained for jobs to fit their abilities according to the skills of each employee. Besides that, Human Relations is one of the importance theories where Malaysia practices because the management concerned with the study of workers in a group and the social aspects of work.

Teamwork is very important in every organization whether it is a big or small company. (Page 7)Malaysia are alarm in participative style whereby all employees must participate in every project or assignment that are given to improve their knowledge, skills, ability and also working together. Collectivism is one of the dimensions of managerial style that are concerned by all management in the organizations where employees have the right to voice out their opinions or decisions.

The level of employee participation and the acceptance of organized labour as an alternative authority structure can measure it. The core objectives of MEF offers quality and professional training courses in the area of Industrial Relations such as labour laws, discipline and collective bargaining, Human Resource Management and Occupational and Safety Health. While for NCCIM, it works with the organizations within and outside the country where it aims to promote Malaysia's trade abroad and create a conducive investment climate for foreign investors in Malaysia and the ASEAN countries.

The NCCIM aims to achieve internal equanimity of opinion, so decisions are reached on a consensus basis among constituent members. The general objective is to promote the interests of corporations and persons in commerce and industry in Malaysia. Close liaison and a good rapport with government are vital in discharging its duties. It maintains an ongoing consultation on every aspect of business and economic development. (Page 8)6.


As the nation of Malaysia strive towards the goals of Vision 2020, the role of industrial relations which are the tripartite become crucial factor in determining the industrial competitiveness. However, it is felt that visionary leadership is more crucial to the long-term success of Malaysian trade unions rather than the legal implications. The government in Malaysia has adopted a domineering role of employment relations where it shaped almost all aspect of employment relationship to achieve the industrial peace and improving the levels of productivity.

As Malaysia move into the 21st century the challenge that are going to face will be to establish macro-environments that will remain attractive to foreign investment and at the same time provide an environment stability and security for people operating at the micro or organizational level. That is, maintaining a balance between the flexibility and cost containment already achieved and establishing job security, training and development programmes that will address the skill shortages currently being experienced. If Malaysia can achieve this and at the same time maintain the confidence of foreign investors then it can look forward to a profitable role in the global community. (Page 9)


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