Definitive Report - Report No 281, March 1992

Case No 1542 (Malaysia) - Complaint date: 24-JUL-90 - Closed

1. 22. The Committee has already examined the substance of this case on one previous occasion, at which it presented interim conclusions to the Governing Body (see 277th Report, paras. 383 to 405, approved in February-March 1991).
2. 23. The Government supplied certain further information on this case in a communication dated 10 January 1992.
3. 24. 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. 25. The International Metalworkers' Federation (IMF) alleged that electronics workers employed by Hitachi Consumer Products in Malaysia had elected to join the Electrical Industry Workers' Union (EIWU), but that the Director-General of Trade Unions used his discretion under the Trade Union Act, 1959 to determine that the EIWU was not eligible to represent the workers employed by that company. The Government replied that the real issue was not whether workers at the Hitachi plant had been denied the right to organise, but rather whether they fell within the membership rule of the EIWU. The Director-General had carried out a thorough investigation, hearing submissions from both the union and the employer and had decided that the workers were producing components not covered by the EIWU's membership rule; this did not, however, mean that they could not form or join a trade union if they so wished.
2. 26. It was also alleged that eight workers had been dismissed for their organisational activities on behalf of the EIWU at the Hitachi plant and that 21 workers were not rehired after a strike at the factory from 18 to 22 June 1990 protesting against the eight dismissals. The Government's reply simply stated that both the Malaysia Constitution and the Industrial Relations Act, 1967 protected the rights of workers to form and join unions of their choice subject to the representation scope of the union concerned.
3. 27. At its February-March 1991 Session, in the light of the Committee's interim conclusions, the Governing Body approved the following recommendations:
   • (a) That the Government introduce legislation to amend the Trade Union Act, 1959 to ensure that all workers, including those in the electronics industry, enjoy the right to establish and to join the organisations of their choice as guaranteed by the principles of freedom of association. The legislation should also be amended to ensure that responsibility for the interpretation of trade union rules is vested in judicial rather than administrative authorities.
   • (b) The Committee suggests that the Government use the technical assistance of the ILO in order to help it bring its law and practice into full conformity with the principles of freedom of association.
   • (c) That the Government provide a full response to the allegations relating to the dismissal of eight workers for their organisational activities on behalf of the EIWU, and to the failure to rehire 21 workers in the aftermath of a strike in June 1990, also on account of their trade union activities. These observations should be provided as soon as possible, so as to enable the Committee further to examine this case at its next meeting.

B. The Government's reply

1. 28. In its letter of 10 January 1992, the Government reiterates that in Malaysia freedom of association is guaranteed under article 10 of the Constitution. Parliament is the supreme legislative body empowered under article 10(3) to impose any restrictions, as may be deemed necessary and expedient, on the right to form associations. The Government is of the opinion that the Trade Union Act is not in breach of the supreme law of the country and as such it is unable to give effect to the recommendations of the Committee. The Government has always welcomed the ILO's advisory services through consultations with the ILO Regional Adviser on Standards. The Government feels that the present law and practice relating to registration of trade unions are satisfactory and have assisted the orderly growth of trade unions. Furthermore, they have led to the present state of harmonious industrial relations prevailing in the country.
2. 29. The Government points out that five unions in the electronics sector have so far been registered. The fact that these unions are free and independent is testimony to the freedom of association granted to trade unions in Malaysia.
3. 30. It states that its labour laws are constantly being revised to ensure that they are consonant with political, economic and social developments in the country. In drafting these laws, the Government also takes into account the stage of economic development, international protectionism and competition, and the different levels and conditions of employment prevailing in different parts of the country.
4. 31. As regards the dismissal of eight workers, the Government explains that the EIWU filed a claim for recognition on Hitachi Consumer Products Sdn. Bhd. on 13 November 1989. The Director-General of Trade Unions, to whom the issue of competency of the EIWU to represent the workers of the company was referred, decided that the EIWU was not, under the rules of the union's constitution, competent to represent the said workers. This decision was conveyed to the EIWU and the company on 5 June 1990. Two weeks later 1,093 workers went on strike in protest against this decision. The strike was unlawful as it was in contravention of section 10(1) of the Industrial Relations Act, 1967 which prohibits strikes in respect of recognition matters. On 19 June the company dismissed eight workers who were alleged to have instigated the strike. The strike continued until 21 June when the company dismissed all workers on strike on the ground of having participated in an illegal strike. The dismissals took place after the workers ignored repeated advice from the company and the Industrial Relations Department to return to work.
5. 32. According to the Government, on 25 June 1990 all workers were reinstated after giving written apologies to the company for having gone on an illegal strike, with the exception of 21 workers (including the eight workers dismissed earlier). All the 21 workers who were not reinstated made representations for reinstatement under section 20 of the Industrial Relations Act, 1967. Conciliation proceedings held by the Industrial Relations Department, during which the workers were represented by EIWU, resulted in a settlement by way of ex gratia payment (in lieu of reinstatement) on the basis of 70 per cent of the last-drawn monthly salary for each year of service.
6. 33. The Government stresses that the eight workers were dismissed not because they "had been active in organising union membership" as alleged by the IMF. The dismissals took place after the strike and hence were not the cause of the strike as alleged.

C. The Committee's conclusions

1. 34. The Committee notes that, according to the Government, the 21 workers who were not rehired following a strike in June 1990 at the Hitachi plant over the dismissal of eight union organisers were represented by the EIWU in conciliation proceedings for reinstatement under the Industrial Relations Act and that these proceedings resulted in a settlement of their claims by way of ex gratia payments. While noting that this aspect of the complaint appears to be settled to the satisfaction of those involved, the Committee cannot but react to the Government's statement that the dismissals did not take place because of union organising efforts but rather because of the illegal strike. In this connection, the Committee recalls that when trade unionists or union leaders are dismissed for having exercised peacefully the right to strike, it can only conclude that they have been punished for their trade union activities. In addition, in cases such as the present one, the Committee has stated that the use of extremely serious measures, such as dismissal of workers for having participated in a strike, constitutes a violation of freedom of association and that the workers concerned should have the right to be reinstated in their functions.
2. 35. Regarding the provisions of the Trade Union Act, 1959 and the administrative authority's use of its discretion thereunder to restrict the choice of unions open to electronics workers, the Committee regrets the Government's attitude. It would point out, as it has in the past examination of this case, that there have been six occasions since 1977 when it has been presented with allegations relating to the denial of the right of workers in the electronics industry in Malaysia to establish or to join the union of their choice. In this connection, it should be pointed out in the first place that the Trade Unions Ordinance of 1959 limits the right to associate within the same trade union to the workers within any particular trade, occupation or industry or within any similar trades, occupations or industries (see sections 2 and 9). It is for the Registrar of Trade Unions to decide (subject to a right of appeal to the Minister of Labour, and thereafter to the High Court (sections 17 and 18)) what is to be understood by "similar" trades, occupations or industries. The Registrar is also empowered to cancel the registration of a trade union, inter alia, if it has contravened any provision of the Ordinance (177th Report of the Committee on Freedom of Association, para. 105).
3. 36. Faced with the Government's refusal to act on this matter, the Committee can only recall, once again, that the difficulties encountered in this connection are not of recent origin and that attention was already drawn to them during a survey of the trade union situation in the Federation of Malaya carried out by the ILO in 1961 (ILO: The trade union situation in the Federation of Malaya, Geneva, 1962, pp. 54, 55, 102 and 103). In numerous past cases where the EIWU presented identical allegations, the Committee considered that the legislation and its interpretation limited the choice open to workers, so that they were not denied the right to organise but could not decide by themselves to which union they may belong, and it asked for amendments to the law.
4. 37. In the present case, recalling that administrative authorities should not be in a position to influence the free choice of organisations by workers, the Committee must again insist that the Government take steps to ensure that electronics workers are permitted a genuine free choice of unions to which they might wish to belong, and that such free choice is not in any way limited by an interpretation by the administrative authorities of union rules in so far as these determine the scope of their membership (General Survey on Freedom of Association and Collective Bargaining of the Committee of Experts on the Application of Conventions and Recommendations, 1983, para. 139).

The Committee's recommendations

1. 38. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendation:
   • The Committee regrets that it must again insist that the Government take steps to amend the Trade Union Act, 1959 so as to ensure that electronics workers are permitted a genuine free choice of unions to which they might wish to belong, and that such free choice is not in any way limited by an interpretation by the administrative authorities of union rules in so far as these determine the scope of their membership.