Labour Clauses (Public Contracts) Convention, 1949 (No. 94) - Malaysia - Sarawak (Ratification: 1964)

Observation (CEACR) - adopted 2022, published 111st ILC session (2023)

Article 2 of the Convention. Insertion of labour clauses in public contracts. In its previous comments, initially made in 2013, the Committee requested the Government to indicate the measures it intended to take to bring its national legislation into full conformity with the requirements of the Convention. The Government reports that the provisions of the Convention are given effect through the general terms of contracts issued by the Public Works Department, which is the main implementer of public projects in Sarawak. It adds that the contracts specify, among other things, the engagement of workers and labour, the removal of workers and other personnel, days and hours of work and insurance for workers. The Government further indicates that requirements governing the payment of wages, hours of work and other working conditions are provided under the Labour Ordinance of Sarawak (Amendment) Act 2005. The Committee notes that the Labour Ordinance does not address public contracts and that the Government does not provide specific information regarding the manner in which Article 2 of the Convention is given effect. In this respect, the Committee draws the Government’s attention to paragraph 45 of the 2008 General Survey on labour clauses in public contracts, in which it pointed out that the essential purpose of the Convention is to ensure that workers employed under public contracts shall enjoy the same conditions as workers whose conditions of employment are fixed not only by national legislation but also by collective agreements or arbitration awards, and that in many cases the provisions of the national legislation respecting wages, hours of work and other conditions of employment provide merely for minimum standards which may be exceeded by collective agreements. Therefore, the Committee emphasized that the mere fact of the national legislation being applicable to all workers does not release the States which have ratified the Convention from the obligation to take the necessary steps to ensure that public contracts contain the labour clauses specified in Article 2 of the Convention. Recalling that it has been commenting for a number of years on the Government’s failure to fully implement the core requirements of the Convention, the Committee reiterates its request that the Government clarify whether the public procurement legislation currently in force addresses in any manner the question of labour clauses in public contract. The Committee urges the Government to take all necessary measures without delay to bring its national legislation into full conformity with Article 2 of the Convention. It further requests the Government to keep the Office informed of progress made and recalls that the Government may avail itself of the technical assistance of the ILO in this regard, should it wish to do so.

Application of the Convention. Part V of the report form. The Committee requests the Government to provide a detailed report with full particulars on each of the provisions of the Convention, to enable the Office to assess the extent to which the provisions of the Convention are applied in law and practice, and to transmit copies of any relevant bidding documents currently in use.

Direct Request (CEACR) - adopted 2019, published 109th ILC session (2021)

The Committee notes that the Government’s report contains no reply to its previous comments. It hopes that the next report will contain full information on the matters raised in its previous comments.

Repetition

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee notes that the general terms of public contracts for public works currently in use (first published in 2006) – a copy of which was attached to the Government’s report – no longer contain a clause on fair wages and labour conditions requiring contactors to pay wages and observe hours of work and conditions of labour not less favourable than those established for the trade or industry in the district where the work is carried out by machinery of negotiation or arbitration to which the parties are organizations of employers and trade unions representative respectively of substantial proportions of the employers and workers engaged in the trade or industry in the district. The Committee also notes the Government’s statement that the general terms apply only to public contracts for construction works and do not cover contracts for the manufacture of goods or the supply of services thus covering only partially public procurement contracts as defined in Article 1(1) of the Convention.

The Committee wishes to recall that sections 15.1 and 17.1 of the general terms, which merely require contractors to comply with the provisions of the Labour Ordinance (Chapter 76), fall short of giving effect to the core requirement of Article 2 of the Convention. The Committee also observes that section 15.3 of the general terms, which provides for the withholding of payments due to the contractor or his/her subcontractors for the purpose of recovering any unpaid workers’ wages, may be in line with the type of sanctions provided for in Article 5(2) of the Convention, but is not sufficient to fully implement that provision in the absence of labour clauses of the type prescribed in Article 2 of the Convention. As the Committee has pointed out on numerous occasions, the Convention aims at ensuring that workers employed in the execution of public contracts enjoy working conditions that are not less favourable than those established by collective agreement, arbitration award, or by national legislation for work of the same type carried out in the same region. In practice, this means that contractors have to offer to the workers concerned wages and working conditions that are not less favourable than the highest standards prevailing locally and established through collective bargaining, arbitration or law. The Committee therefore requests the Government to indicate the measures it intends to take in order to bring the national legislation into full conformity with the requirements of the Convention.

Direct Request (CEACR) - adopted 2018, published 108th ILC session (2019)

The Committee notes with regret that the Government’s report has not been received. It hopes that the next report will contain full information on the matters raised in its previous comments initially made in 2013.

Repetition

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee notes that the general terms of public contracts for public works currently in use (first published in 2006) – a copy of which was attached to the Government’s report – no longer contain a clause on fair wages and labour conditions requiring contactors to pay wages and observe hours of work and conditions of labour not less favourable than those established for the trade or industry in the district where the work is carried out by machinery of negotiation or arbitration to which the parties are organizations of employers and trade unions representative respectively of substantial proportions of the employers and workers engaged in the trade or industry in the district. The Committee also notes the Government’s statement that the general terms apply only to public contracts for construction works and do not cover contracts for the manufacture of goods or the supply of services thus covering only partially public procurement contracts as defined in Article 1(1) of the Convention.

The Committee wishes to recall that sections 15.1 and 17.1 of the general terms, which merely require contractors to comply with the provisions of the Labour Ordinance (Chapter 76), fall short of giving effect to the core requirement of Article 2 of the Convention. The Committee also observes that section 15.3 of the general terms, which provides for the withholding of payments due to the contractor or his/her subcontractors for the purpose of recovering any unpaid workers’ wages, may be in line with the type of sanctions provided for in Article 5(2) of the Convention, but is not sufficient to fully implement that provision in the absence of labour clauses of the type prescribed in Article 2 of the Convention. As the Committee has pointed out on numerous occasions, the Convention aims at ensuring that workers employed in the execution of public contracts enjoy working conditions that are not less favourable than those established by collective agreement, arbitration award, or by national legislation for work of the same type carried out in the same region. In practice, this means that contractors have to offer to the workers concerned wages and working conditions that are not less favourable than the highest standards prevailing locally and established through collective bargaining, arbitration or law. The Committee therefore requests the Government to indicate the measures it intends to take in order to bring the national legislation into full conformity with the requirements of the Convention.

Direct Request (CEACR) - adopted 2017, published 107th ILC session (2018)

The Committee notes that the Government’s report has not been received. It hopes that the next report will contain full information on the matters raised in its previous comments initially made in 2013.

Repetition

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee notes that the general terms of public contracts for public works currently in use (first published in 2006) – a copy of which was attached to the Government’s report – no longer contain a clause on fair wages and labour conditions requiring contactors to pay wages and observe hours of work and conditions of labour not less favourable than those established for the trade or industry in the district where the work is carried out by machinery of negotiation or arbitration to which the parties are organizations of employers and trade unions representative respectively of substantial proportions of the employers and workers engaged in the trade or industry in the district. The Committee also notes the Government’s statement that the general terms apply only to public contracts for construction works and do not cover contracts for the manufacture of goods or the supply of services thus covering only partially public procurement contracts as defined in Article 1(1) of the Convention.

The Committee wishes to recall that sections 15.1 and 17.1 of the general terms, which merely require contractors to comply with the provisions of the Labour Ordinance (Chapter 76), fall short of giving effect to the core requirement of Article 2 of the Convention. The Committee also observes that section 15.3 of the general terms, which provides for the withholding of payments due to the contractor or his/her subcontractors for the purpose of recovering any unpaid workers’ wages, may be in line with the type of sanctions provided for in Article 5(2) of the Convention, but is not sufficient to fully implement that provision in the absence of labour clauses of the type prescribed in Article 2 of the Convention. As the Committee has pointed out on numerous occasions, the Convention aims at ensuring that workers employed in the execution of public contracts enjoy working conditions that are not less favourable than those established by collective agreement, arbitration award, or by national legislation for work of the same type carried out in the same region. In practice, this means that contractors have to offer to the workers concerned wages and working conditions that are not less favourable than the highest standards prevailing locally and established through collective bargaining, arbitration or law. The Committee therefore requests the Government to indicate the measures it intends to take in order to bring the national legislation into full conformity with the requirements of the Convention.

Direct Request (CEACR) - adopted 2013, published 103rd ILC session (2014)

Article 2 of the Convention. Insertion of labour clauses in public contracts. Further to its previous comment, the Committee notes that the general terms of public contracts for public works currently in use (first published in 2006) – a copy of which was attached to the Government’s report – no longer contain a clause on fair wages and labour conditions requiring contactors to pay wages and observe hours of work and conditions of labour not less favourable than those established for the trade or industry in the district where the work is carried out by machinery of negotiation or arbitration to which the parties are organizations of employers and trade unions representative respectively of substantial proportions of the employers and workers engaged in the trade or industry in the district. The Committee also notes the Government’s statement that the general terms apply only to public contracts for construction works and do not cover contracts for the manufacture of goods or the supply of services thus covering only partially public procurement contracts as defined in Article 1(1) of the Convention.

The Committee wishes to recall that sections 15.1 and 17.1 of the general terms, which merely require contractors to comply with the provisions of the Labour Ordinance (Chapter 76), fall short of giving effect to the core requirement of Article 2 of the Convention. The Committee also observes that section 15.3 of the general terms, which provides for the withholding of payments due to the contractor or his/her subcontractors for the purpose of recovering any unpaid workers’ wages, may be in line with the type of sanctions provided for in Article 5(2) of the Convention, but is not sufficient to fully implement that provision in the absence of labour clauses of the type prescribed in Article 2 of the Convention. As the Committee has pointed out on numerous occasions, the Convention aims at ensuring that workers employed in the execution of public contracts enjoy working conditions that are not less favourable than those established by collective agreement, arbitration award, or by national legislation for work of the same type carried out in the same region. In practice, this means that contractors have to offer to the workers concerned wages and working conditions that are not less favourable than the highest standards prevailing locally and established through collective bargaining, arbitration or law. The Committee therefore requests the Government to indicate the measures it intends to take in order to bring the national legislation into full conformity with the requirements of the Convention.

Direct Request (CEACR) - adopted 2012, published 102nd ILC session (2013)

The Committee notes 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, which read as follows:

Repetition

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee notes the Government’s reference to the general terms of contracts issued by the Public Works Department of Sarawak, excerpts of which were attached to the Government’s report. It notes, in particular, that section 15.1 of the general terms provides that the contractor must comply with all orders, notices or instructions of the Director of Labour and with the provisions of the Labour Ordinance (Chapter 76) or any other written law. In this connection, the Committee wishes to refer to paragraph 110 of its General Survey of 2008 on labour clauses in public contracts, in which it pointed out that a clause in public contracts generally requiring conformity with general labour legislation alone does not ensure the application of the Convention, since the essential element required for the application of the Convention is that a labour clause, as prescribed in Article 2(1) and (2), of the Convention, be incorporated into the public contract. In addition, the Committee recalls that the Government has been referring in earlier reports to sections 21 (fair wages) and 22 (days and times of work) of the general terms of contracts which gave full effect to the requirements of the Convention. The Committee accordingly requests the Government to specify whether the above clauses are still part of the current version of the general terms of contracts or whether they have been removed or otherwise amended in the meantime. Moreover, recalling that the general terms apply only to contracts for public works, the Committee asks the Government to explain how it is given effect to the Convention in respect of public contracts for the manufacture of goods or the supply of services. Finally, the Committee would appreciate receiving a copy of the full text of the general terms of contracts currently in force.

Direct Request (CEACR) - adopted 2008, published 98th ILC session (2009)

Article 2 of the Convention. Insertion of labour clauses in public contracts. The Committee notes the Government’s reference to the general terms of contracts issued by the Public Works Department of Sarawak, excerpts of which were attached to the Government’s report. It notes, in particular, that section 15.1 of the general terms provides that the contractor must comply with all orders, notices or instructions of the Director of Labour and with the provisions of the Labour Ordinance (Chapter 76) or any other written law. In this connection, the Committee wishes to refer to paragraph 110 of its General Survey of 2008 on labour clauses in public contracts, in which it pointed out that a clause in public contracts generally requiring conformity with general labour legislation alone does not ensure the application of the Convention, since the essential element required for the application of the Convention is that a labour clause, as prescribed in Article 2, paragraphs 1 and 2, of the Convention, be incorporated into the public contract. In addition, the Committee recalls that the Government has been referring in earlier reports to sections 21 (fair wages) and 22 (days and times of work) of the general terms of contracts which gave full effect to the requirements of the Convention. The Committee accordingly requests the Government to specify whether the above clauses are still part of the current version of the general terms of contracts or whether they have been removed or otherwise amended in the meantime. Moreover, recalling that the general terms apply only to contracts for public works, the Committee asks the Government to explain how it is given effect to the Convention in respect of public contracts for the manufacture of goods or the supply of services. Finally, the Committee would appreciate receiving a copy of the full text of the general terms of contracts currently in force.

For all useful purposes, the Committee attaches herewith a copy of a Practical Guide, prepared by the Office principally on the basis of the General Survey of 2008 on Convention No. 94, to help better understand the requirements of the Convention and ultimately improve its application in law.