Last Updated: Monday, 22 January 2018, 12:53 GMT

2009 Annual Survey of violations of trade union rights - Malaysia

Publisher International Trade Union Confederation
Publication Date 11 June 2009
Cite as International Trade Union Confederation, 2009 Annual Survey of violations of trade union rights - Malaysia, 11 June 2009, available at: [accessed 22 January 2018]
DisclaimerThis is not a UNHCR publication. UNHCR is not responsible for, nor does it necessarily endorse, its content. Any views expressed are solely those of the author or publisher and do not necessarily reflect those of UNHCR, the United Nations or its Member States.

Population: 27,730,000
Capital: Kuala Lumpur
ILO Core Conventions Ratified: 29 – 98 – 100 – 138 – 182 – (105 – denounced)

According to the Malaysian Trades Union Congress (MTUC), the Trade Unions Act (TUA), amended again in 2008, is designed to obstruct the creation and development of independent and strong unions. Migrant workers are prevented by law from organising or applying to register a trade union and suffer from harsh working conditions. Cases of union busting remain numerous.

Trade union rights in law

Government weakens union rights in core labour laws: The law recognises the right of most workers to form and join trade unions, but the 1959 Trade Unions Act (TUA) and the 1967 Industrial Relations Act (IRA) place extensive restrictions on freedom of association. The ILO Committee on Freedom of Association (CFA) has found that many provisions of the TUA violate the principles of freedom of association, and it noted in its 349th Report that recent amendments in the laws were done "without consideration" of the ILO's recommendations.

Other laws also place restrictions on freedom of association. For example, the Malaysian Penal Code requires police permission for public gatherings of more than five people.

Many restrictions on union formation, wide discretion in de-registering unions: The Director General of Trade Unions (DGTU) has the power to supervise and inspect trade unions, can refuse to register a trade union without giving any reason for the refusal and can withdraw registration. Unions that do not register, or whose registration has been denied or withdrawn, are considered illegal organisations. The DGTU is given very broad discretion in deciding these matters. The DGTU may also deregister a union if s/he finds that two or more registered trade unions exist in a "particular establishment, trade, occupation or industry". The DGTU has the authority to suspend a branch of a trade union if s/he "is satisfied" that the branch has contravened any part of the Act or the rules of the union.

The DGTU can specify the sector and category in which a union would be permitted to organise. The TUA limits trade union membership to workers in similar trades. General unions are prohibited. The government continues to bar the formation of national unions in the electronics industry and only allows the creation of in-house, enterprise-level electronics unions.

A particularly worrying development is that of the new amendments to the IRA, passed through Parliament by the government and which will allow the Director-General to delegate many of these expansive powers to local officials.

The Minister of Human Resources may also suspend a trade union for up to six months in the interests of national security or public.

Banned from organising: The law prohibits industrial unions from organising employees in managerial and executive positions.

A 2007 IRA amendment adds "executive" and "security" employees to the classifications of "managerial" and "confidential" staff who are not protected against anti-union discrimination, but then fails to define the parameters of "executive" and "security" service. This causes a real possibility of systematic abuse by employers. The amended law also provides that the Director General and the Minister have absolute authority to determine designations of workers' status as "executive", "security", "managerial" and "confidential" staff. Their decisions cannot be appealed to any Court.

This definition is extensively abused by most employers to deny union membership rights and remove experienced union leaders, often by interpreting the managerial and executive category as including supervisors, assistant supervisors, section leaders and lower-level supervisory personnel.

Requirement of union to receive recognition from employer: The IRA provides that a trade union must apply for recognition from the employer, who then can recognise the union, deny recognition or appeal to the Director General for a ruling on whether the members of the union are members. This provision is systematically abused by employers to delay union recognition and thwart efforts by unions to organise and collectively bargain.

The new IRA has further weakened union protections by abandoning the previous practice of requiring officials to use the register of trade union members (which is required by law) to determine the legitimacy of challenges to employers' refusal to recognise a union. This provides for a secret ballot of workers to be undertaken, but the law completely fails to provide adequate safeguards against employer manipulation of the size of the bargaining unit (through addition of temporary or fixed-term contract workers) for the purposes of the election. The new IRA law also contains provisions that are biased towards recognition of enterprise-level unions as opposed to industrial unions.

Another amendment to the IRA in 2007 provides that if the trade union fails to report to the Minister within 14 days about the employer's refusal to recognise the union, the Minister shall deem the union's application for recognition withdrawn. Furthermore, the law now states that workers in a union that has its recognition withdrawn in this manner shall have no protection against dismissal.

Migrant workers: In early 2008, the government completed a process of amending the TUA 1959 and the IRA 1967 in a number of ways which were vehemently opposed by the Malaysian labour movement. One of the provisions that has relevance to migrant workers is a change in the method for determining the legitimacy of a union's challenge to an employers' refusal to recognise the union. The new IRA has further weakened union protections by abandoning the previous practice of requiring officials to use the register of trade union members (which is required by law) for determining the legitimacy of challenges to an employers' refusal to recognise a union. Now the law requires a secret ballot of workers to be conducted, in which the union must achieve a majority to win. However, the law fails to provide adequate safeguards against employer manipulation of the size of the bargaining unit (through addition of temporary or fixed-term contract workers, including those who are migrants) for the purposes of the election. Employer intimidation then is used to either prevent migrant workers from voting or ensuring they vote against the union – in either case contributing to the same goal of defeating the union's effort to prove its representative status to challenge the employer's refusal to recognise the union.

Under the TUA and the IRA, a migrant worker can join an existing labour union and participate in its activities. However, Article 28(a) of the TUA requires that any union officer must be a citizen of Malaysia, effectively disqualifying migrant workers from serving as leaders of a union. The Ministry of Home Affairs (MHA) also sets out a series of conditions connected to the issuance of work permits to migrant workers. One of these conditions is an absolute prohibition on migrant workers joining any sort of association.

Restrictions on the public sector: In the public sector, employees working for the defence sector, police force or prisons do not have the right to form or join trade unions.

Restrictions on the right to strike: The right to strike is not specifically recognised, and legislative restrictions make it practically impossible for workers to hold a legal strike. Trade unions are not allowed to go on strike for disputes relating to trade union registration or illegal sackings. General strikes and sympathy strikes are not permitted.

Penalties for executive committee members of a union who engage in an illegal strike include fines and imprisonment for up to one year. Rank and file workers who engage in an illegal strike are considered by the government to be automatically stripped of their union membership and cannot join another trade union in the future without the written approval of the DGTU.

Pre-strike authorisation procedures are cumbersome. Two thirds of the members of a trade union must vote in favour of a strike in a secret ballot, and the ballot must include a resolution that states "the nature of the acts to be carried out or to be avoided during the strike". The results of the ballot are passed to the DGTU for verification. Once all procedures have been complied with, a seven-day cooling-off period is imposed. During the cooling-off period, the Ministry of Human Resources' Industrial Relations Department can attempt conciliation and, if this fails, refer the dispute to the Industrial Court. While the dispute is before the Industrial Court, picketing, strikes and lockouts are prohibited.

Trade unions in "essential services" must give at least 21 days' notice before going on strike. Essential services are very broadly defined and include health care, education and transportation.

Prior approval needed for international affiliation: The TUA requires that trade unions seek prior permission from the DGTU before affiliating with any "consultative body...established outside of Malaysia". Consideration of that application is subject to whatever conditions the DGTU sees fit to impose.

Significant restrictions on collective bargaining: The IRA excludes hiring and firing, transfer and promotion, dismissal and reinstatement from the scope of collective bargaining. The latest amendment of the IRA has further restricted the scope of collective bargaining by setting out very narrow areas that can be proposed for bargaining. These topics include making provisions for training to enhance skills, for an annual review of the wage system and for a performance-related remuneration system.

The IRA also restricts collective bargaining in companies in "pioneer" industries, such as the electronics industry.

In the public sector, the joint council system limits public sector unions to a consultative role where their only power is to "express their point of view" on principles regarding wages and working conditions.

Setting caps on court-ordered remedies in the event of anti-union dismissals: The new IRA law sets firm instructions that judges must provide no more than 24 months of back pay from the date of dismissal in an anti-union firing case and requires that money that a sacked worker earns post-dismissal shall be deducted from the back pay awarded.

Industrial Court's discretionary power removed: According to the MTUC, the new amendments removed the discretionary powers of the Industrial Court, which had hitherto played a prominent role in the settling of labour disputes and promoting industrial harmony.

Trade union rights in practice and violations in 2008

Ban on general confederations: Owing to the ban on forming general confederations of trade unions, the MTUC, which covers both private and public sectors and has 500,000 members, is not recognised as a trade union confederation in law. Instead, the MTUC is registered under the Societies Act and therefore does not have the right to conclude collective bargaining agreements nor to undertake industrial action.

Union recognition arbitrary and extremely slow: Obtaining a response from an employer to a request for union recognition should take a maximum of 21 days. However, in reality this takes much longer if a dispute occurs, because the matter must be taken to the Director General of Industrial Relations (DGIR), the DGTU and then the Minister of Human Resources, who has the final say, unless that is challenged in the High Court. Some applications take as long as three to five years.

In a previous complaint to the ILO, the MTUC listed cases in which the DGTU had arbitrarily denied organisational and collective bargaining rights to more than 8,000 workers in manufacturing companies.

Longstanding complaints from the MTUC and its affiliates over the cumbersome process to obtain union recognition and collective bargaining remained unresolved despite the changes to the Industrial Relations Act. The amendments stipulated specific measures to resolve the unions' claim for recognition within a period of six months. Unfortunately, government authorities claimed that they could not enforce the amendments because of the absence of appropriate regulations. Ten months after the promulgation of the amendment bill, the Human Resources Ministry had not produced the implementing regulations.

Canon Opto's refusal to recognise in-house trade union: Japanese multinational Canon Opto refused to recognise the in-house union despite certification by the Ministry of Human Resources that the union represented more than 60% of the workforce. Canon has filed a challenge in the High Court. Until the matter is decided in court, which the MTUC says could take between five and ten years, the employer is not required to recognise the union and can refuse to commence collective bargaining. By the end of 2008 most members had stopped paying their union fees.

As of December 2008, there were 18 such cases dragging through the legal process.

Inefficient labour courts: So far, the government has failed to apply any sanctions against employers who have opposed its directives granting trade union recognition or who have refused to comply with industrial court orders to reinstate illegally dismissed workers. In some cases, companies have used tactics such as changing their name to thwart workers' legal efforts.

According to the MTUC, the new amendments facilitate union busting activities by multinational companies.

Prohibition on migrant workers forming or leading trade unions: The approximately 2.6 million migrant workers in Malaysia (25% of total workforce) are prevented by law from organising or applying to register a trade union and are barred from serving as officers of the trade union. The MTUC claims that companies intimidate migrant workers to prevent them from joining the union and then use the fact that they are not members to deny recognition to unions by claiming they have the support of less than 50% of the workforce. Notices placed on migrant work permits state that these workers are prohibited to join unions. The system for registering migrant workers discourages workers from asserting their rights because it grants total discretion to employers to terminate workers for virtually any reason.

In addition, the MTUC reports that migrant labour suppliers often withheld the workers' travel documents, which made it difficult for the workers to venture outside their workplaces. MTUC received many reports throughout the year that labour suppliers owed huge sums of money in unpaid wages and breach of contract terms. Reports state that many workers who managed to lodge a complaint at the labour department to seek redress were arrested and sent to a detention camp for overstaying or for not being in possession of a valid travel document.

Police intimidation: On 1 May, police prevented about 200 people in Pudu from gathering at Dataran Merdeka for the start of a Labour Day march.

Migrant workers: Employers have interpreted the IRA and TUA provisions regarding migrant workers to mean that migrant workers are forbidden to join unions. The MHA has declined repeated appeals by the MTUC to make a judgment on the employers' interpretation of this MHA policy. Employers have proceeded to write the restrictions on association into migrant worker contracts, and the MHA has taken no steps to prevent this. Furthermore, violation of the terms of the contract can be punished by dismissal, which in turn leads to revocation of the migrant's work permit and initiation of deportation proceedings. The threat of firing and deportation prompts great fear in migrant workers, who have become reluctant to join in workers' mutual support and assistance efforts.

Underpaid and imprisoned migrant workers: Thirty-nine Vietnamese and 19 Indonesian workers were locked in their dormitory and barred from work at the beginning of May. Despite management's threats and police intervention, they had for several days insisted on talking to the management about increasing their wages. On 10 June, the management asked the Vietnamese workers to sign a statement apologising to the firm and accepting its pay regime in order to return to work. Five accepted the terms. Three others, whose passports had been confiscated by management, fled to Kuala Lumpur and paid for travel documents in order to go home. Over 30 Vietnamese workers remained held in their dormitory.

Eight Indian workers who were legally employed in a factory in Shah Alam in Malaysia became illegal workers when they complained to the Industrial Court claiming they were underpaid. Their employer immediately cancelled their work permits and classified them as illegal workers.

Death at the workplace: On 6 November, hundreds of migrant workers at a factory in Menglembu went on strike to protest about the death of Dil Bahadur, 40, a fellow worker and Nepalese national. The workers claim that Dil Bahadur died because the management officials at the factory delayed sending him to hospital after he developed chest pain and breathing difficulties. The striking workers also complained of being underpaid, being prohibited from being able to return home at the end of their contract and having to pay for their board and lodging. On 28 May, five migrant workers, four Bangladeshis and one Burmese, died after being trapped in a fire at a furniture factory in Kampung Melayu Subang.

The MTUC estimates that 15 to 20% of the registered foreign workers in the country are being mistreated, and it noted that it receives hundreds of cases every month of migrant workers whose rights have been abused by employers and government authorities.

Domestic workers: no rights and an abundance of abuse: Many of the approximately 400,000 primarily Indonesian domestic workers in Malaysia experience withheld wages, forced confinement and excessively long working hours without days off; some face physical and sexual abuse. Domestic workers are excluded from key provisions of Malaysia's 1955 Employment Act, and their work permits tie them to a particular employer, making it difficult to report abuse for fear of deportation. Cases of severe physical abuse of migrant domestic workers continue to be reported. In September 2008 a Malaysian employer forced an Indonesian domestic worker to drink boiling water.

People's Volunteer Corps (RELA) institute reign of fear among migrant workers: The RELA, a volunteer corps of civilians serving as auxiliaries to the authorities and receiving a reward for each undocumented migrant worker they apprehend, was implicated in numerous grievous human rights abuses against migrant workers during the year. The MTUC proclaimed in 2007 that "law enforcement should always be done by professionally trained police and other law enforcement officers" and called for RELA to be abolished. However, the government was actively seeking a new law to formalise RELA as an organisation under the Ministry of Home Affairs.

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