Definitive Report - Report No 202, June 1980

1. 122. This case has been previously examined by the Committee at its February-March 1979 Session, when it submitted interim conclusions to the Governing Body. The International Metalworkers' Federation (IMF) presented additional information in letters dated 7 February and 13 July 1979, and by a communication dated 12 September 1975, the Malaysian Trade Union Congress (MTUC) presented additional allegations relating to the case. The Government sent its reply in a communication dated 6 May 1980.
2. 123. Malaysia has not ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87); it has ratified the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. Previous examination of the case

1. 124. In its previous examination of the case, the Committee concluded that it concerned the legislative and administrative obstacles encountered by various trade unions in Malaysia in their attempts to build up organisations representing larger sectors of the metal and the electrical/electronic trades and the alleged lack of action by the Government in implementing the Committee's earlier recommendations on these questions made in Case No. 879 concerning Malaysia. Two further cases of refusal by the Registrar of Trade Unions to allow certain unions to organise the workers in individual undertakings were alleged.
2. 125. The complainant stated that, despite the Committee's conclusion in Case go. 879 suggesting that the Government take steps to ensure that the provisions of the Malaysian Trade Unions Ordinance on the establishment of first-degree unions are interpreted in a less restrictive manner by the administrative authorities, the Registrar of Trade Unions was continuing to refuse to register unions in "similar" industries. In particular, it stated that the Registrar and the appeals system had refused to allow organisation of certain enterprises by the Electrical Industry Workers' Union (EIWU) by differentiating between the electronic and electrical industries on the basis of mode of working and methods of production.
3. 126. The complainant alleged that the EIWU was refused recognition for collective bargaining purposes at the Mitsumi Electric Company by the Registrar, although the company was willing to accord recognition, by classifying Mitsumi as an electronic factory. A similar situation allegedly occurred at the Sankyo Seiki (Malaysia) Company where the Metal Industry Employees' Union (MIEU) was recognised by the company but was refused representation and collective bargaining rights by the Registrar. Appeals against these two decisions were made to the Minister of Labour in accordance with the Trade Unions Ordinance.
4. 127. The Government replied that at the present stage of development of Malaysian trade unions, the workers could be subject to manipulation by trade union leaders, contrary to their own and the nation's interest, and that the system of classification of industries protects them from that. Moreover, the Government defended the Registrar's interpretation of the term "similar" and stated that he exercised the greatest care to ensure that the workers are grouped in the right union according to their industries.
5. 128. The Committee reiterated its conclusions made in Case No. 879, stating that the word "similar" seemed to be interpreted in a restrictive sense and that workers in comparable or allied trades occupations or industries could not belong to the same trade union. The Committee recalled that restrictive provisions existed under the" Trade Unions Ordinance also in respect of higher-degree organisations, thus preventing workers from establishing federations of their own choosing and constituting an obstacle to the establishment of strong and effective organisations better able to defend their occupational interests. As regards the two further examples of restrictive interpretation cited by the complainant, the Committee noted that while workers are not denied the right to organise, they cannot always decide by themselves to which union they may belong. Noting that, according to the complainant, appeals against the decision of the Registrar were lodged with the Minister in the cases concerning the Sankyo Seiki (Malaysia) and Mitsumi companies, the Governing Body requested the Government to supply information on the outcome of these appeals as well as of any subsequent judicial proceedings which may have been instituted concerning these cases.

B. Further developments

1. 129. By a letter dated 7 February 1979, the IMF supplied a copy of a memorandum submitted by the EIWU to the Minister of Labour in December 1978 along the same lines as its earlier appeals to the Prime Minister which had been referred back to the Department of Labour. The memorandum appeals the Registrar's refusal to register an amendment to the membership scope of the EIWU's Rules and his classification of electronics as an industry not similar to the electrical industry. By a letter dated 13 July 1979, the IMF supplied a copy of another memorandum submitted by the EIWU to the Minister of Labour in June 1979 describing a further case of arbitrary ruling by the Registrar, this time concerning the unionisation of the employees of the Telecoms Department of Ericsson Telecommunications.
2. 130. By a letter dated 12 September 1979, the MTUC submitted similar allegations, adding that the workers' right to organise freely is further hampered by inordinate and often unjustified delays in the processing of recognition claims to determine and establish the representative character of unions. It cites the following examples of fragmentation of unions and unnecessary delays: the Selangor Textile Employees Union has been waiting since 3 January 1979 for recognition although on 7 June the Minister of Labour directed the employer concerned to do so; the Non-metallic Mineral Products Manufacturing Employees Union has been waiting since 13 April 1978 for recognition despite the Minister's direction to the employers concerned to do so; the same union has been waiting since 5 September 1972 for recognition by another employer in similar circumstances. The complainant lists further examples of the Government's alleged lack of co-operation: the machinery Manufacturing Employees Union requested an opinion from the Registrar on 17 July 1977 regarding the possible unionisation of the employees of Sankyo Seiki (M) Sdn Bhd but has received no decision.; the Chemical Workers Union of Malaya and the National Union of Petroleum and Chemical Industry Workers signed an agreement on 3 August 1977 regarding conflicting claims to representativity in two plastics companies; however, the Registrar disapproved of the agreement, did not reply to a request for a meeting to discuss the matter which was made on 18 October 1977, and the Minister has stated that the matter is still under study; the Timber Employees Union has been waiting since 26 September 1977 for recognition from a contractor company but was informed by the Ministry in October 1978 that, due to the termination of the contractor relationship, the application for recognition had become void.
3. 131. The complainant alleges that the organisation and formation of trade union federations face similar problems. It gives examples of the delay encountered by some federations of trade unions in obtaining final registration: the Council of Employees in the Statutory Bodies and Local Authorities (application for registration pending since 1972); and the Congress of Unions in the Private Sectors (application pending since 1975).
4. 132. Lastly, the complainant calls for amendment of various restrictive labour laws, is particular, section 2 (Registrar's discretion to register unions), section 17 (appeal to the Minister), section 27 (restriction on public officers to join trade unions), section 28 (restrictions on holding trade union office), section 30 (Minister's discretion regarding sections 27 and 28), sections 74 and 75 (Registrar's discretion to register federations of trade unions) of the Trade Unions Ordinance; and section 9 (Minister's discretion to accord recognition to certain categories of workers) and section 13 (restriction of subject matter for collective agreements) of the Industrial Relations Act 1967.

C. The Government's reply

1. 133. In its letter of 6 May 1980, the Government states that the various EIWU appeals to unionise workers in the electronic industry were rejected by the Ministry of Labour and Manpower on 27 April and 21 July 1979. The reasons for rejection are (a) that the electronic industry plays an important socio-economic role (in attracting foreign investment and in, reducing unemployment) and that the question of unionisation of its workers should be dealt with in a cautious manner in the present stage of the country's economic development, where foreign investments are greatly needed; (b) that allowing the electronic workers to be unionised by an established union, the EIWU, would create a disincentive for foreign investors in this field, who might leave the country, and would make the EIWU too unwieldy (electronic workers number around 42,000 in 46 establishments); (c) that the membership scope of the EIWU is confined in its membership clause to companies manufacturing complete and finished goods, whereas the electronic industry manufactures components which may be found also in products of other industries. It was for this latter reason that the Registrar of Trade Unions had rejected applications for changes in the EIWU's membership clause. However, at this juncture the Ministry is giving due consideration to applications from workers in two separate electronic companies for formation and registration of trade unions in their respective workplaces.

D. Conclusions of the Committee

1. 134. The Committee notes that this case concerns the alleged restrictive interpretation by the authorities concerned of trade union registration legislation, in particular as regards the unionisation of workers in the electronic industry by the Electrical Industry Workers' Union and the unionisation of the metalworkers by the Metal Industry Employees' Union, and the alleged delays in the processing of various trade union matters, especially of recognition claims, made by both first-degree unions and federations. The complaint also calls for amendment of various provisions of the Trade Unions Ordinance and the Industrial Relations Act.
2. 135. According to the Government's reply, appeals against Registrar of Trade Unions' decisions were heard within a reasonable time, but were rejected by the Ministry of Labour and Manpower on the grounds of socio-economic necessity and of the Ministry's interpretation of the registration provision in the EIWU's membership clause. The Committee notes in this regard that the Ministry does not appear to have taken into account the previous comments of the Committee to the effect that it would be desirable for the Government to take steps to ensure that the provisions on the establishment of first-degree unions were interpreted in a less restrictive manner by the administrative authorities.
3. 136. The Committee notes that the Ministry is now considering applications from workers in two electronic companies to form and register trade unions in their respective workplaces and it hopes that the authorities will take into account the Committee's comments in this regard.
4. 137. Although the Government's reply does not specifically refer to the examples of delays in the processing of registration and recognition claims noted is the complainant's letter of 12 September 1979, the Committee notes that in some cases unions have been awaiting government action since 1977 or before. The Committee would point out that where a long period has elapsed between a request for registration and the obtaining of such registration, it has recalled that while the founders of a trade union must comply with the formalities prescribed by legislation, the administrative handling of such requests should not be of such a nature as to hamper freedom to form organisations. On the other hand, as regards delays in recognition for collective bargaining purposes, the Committee notes that in most cases the Minister has directed the employers concerned to accord recognition. In this connection, the Committee recalls that a refusal by an employer to bargain with a particular union has not been regarded as an infringement of freedom of association appropriate for consideration by the Committee; it has adopted this attitude on the basis of the principle that collective bargaining must, if it is to be effective, assume a voluntary character and not entail recourse to measures of compulsion which would alter the voluntary nature of such bargaining.
5. 138. Regarding the complainant's call for amendment of various allegedly restrictive labour laws, the Committee notes that the Government has not commented on this aspect of the case. Nevertheless, the Committee his examined the provisions of the legislation mentioned by the complainant. In the present case, the complainant cites sections 2, 74 and 75 of the Trade Unions ordinance concerning registration of first-degree unions and federations, respectively, which rely on the Registrar's interpretation of the word "similar". An appeal against the Registrar's opinion can be mad to the Minister (section 17). The complainant mentions section 9 of the Industrial Relations Act concerning recognition claims by managerial, confidential or security staff which is subject to the same ministerial discretion. The Committee would like to recall the comments of the Committee of Experts on the Application of Conventions and Recommendations in this connection, that although registration procedure very often consists in a mere formality, there are a number of countries in which the law confers on the relevant authorities more or less discretionary powers in deciding whether or not an organisation is qualified for registration, thus creating a situation which is similar to that in which previous authorisation is required. Situations can arise where a complicated and lengthy registration procedure, or the latitude with which the competent administrative authorities sometimes exercise their rowers in actual practice, can create a serious obstacle for the establishment of a trade union and lead to a denial of the right to organise without previous authorisation. The problems connected with registration are not only a matter of law, but rather a question of its implementation by the authorities.
6. 139. Moreover, the complainant quotes certain restrictive sections of the Trade Unions Ordinance (section 27, which prohibits public officers from joining any trade union; section 28, which restricts persons from holding union office if they are officers or employees of a political party and if they have not been engaged in a related industry for at least three years; and section 30, which grants to the Minister a discretion in the application of the two above-mentioned sections). In this connection, the Committee would recall, as it has often done in the past, that workers without distinction whatsoever, including public servants, should have the right to join organisations of their own choosing. The Committee also considers that legislation which disqualifies persons from trade union office because of their political beliefs or affiliations is not in conformity with the right of trade unionists to elect their representatives in full freedom.
7. 140. As regards the concept of working in a "related" industry, the Committee is of the opinion that if the national legislation lays down that all trade union leaders must belong to the occupation in which the organisation functions, there is a danger that the right to elect trade union leaders in full freedom may be set aside.
8. 141. The complainant also refers to section 13 of the Industrial Relations Act which excludes from the scope of collective bargaining matters concerning promotion, transfer, appointments, termination of employment for redundancy, dismissal and reinstatement, and assignment of duties on this question, the Committee has pointed out in the past that there are certain matters which clearly appertain primarily or essentially to the management and operation of business and these could reasonably be regarded as outside the scope of negotiation. It is equally clear that certain other matters are primarily or essentially questions relating to conditions of employment and such matters should not be regarded as outside the scope of collective bargaining conducted in an atmosphere of mutual faith and trust.