Interim Report - Report No 190, March 1979

Case No 911 (Malaysia) - Complaint date: 03-JUL-78 - Closed

1. 410. The complaint of the International Metalworkers' Federation (IMF) is contained in two communications dated 3 July 1978 and 8 August 1978, and is supported by additional material forwarded with a letter of 11 October 1978. The Government forwarded its observations in a letter dated 23 December 1978.
2. 411. 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. Allegations of the complainant

1. 412. The complainant alleges that the Government has taken no steps to implement the recommendations made by the Committee in its report concerning Case No. 879.1 In particular, the complainant refers to the recommendations set out in paragraph 113 of the Committee's 177th Report drawing the Government's attention to certain considerations and principles with regard to the freedom of workers to choose for themselves the structure of their trade union organisation; suggesting that the Government take steps to ensure that the provisions on the establishment of first-degree trade unions be interpreted in a less restrictive manner by the administrative authorities and consider amending the legislation on the forming of higher-degree trade union organisations, and drawing the Government's attention also to certain principles regarding the recognition for collective bargaining purposes of the most representative trade union in an undertaking. The complainant further states that a Government delegate at the International Labour Conference in June 1978 questioned in his speech the applicability of universal ILO standards in developing countries. According to the complainant, the Registrar of Trade Unions, in his meeting with the IMF Assistant General Secretary in Kuala Lumpur on 12 June 1978, defended the practices which had been criticised by the ILO.
2. 413. The complainant has supplied a copy of a memorandum submitted by the Malaysian Trades Union Congress to the Prime Minister in July 1976 requesting urgent amendment of labour laws. It also supplies a copy of a memorandum of appeal from the IMF-affiliated Electrical Industry Workers' Union to the Prime Minister, dated 1 May 1978, complaining that despite official recognition in other fields (e.g. 1972 Malaya Industrial classification) of the similarity of electronic and electrical industries, the Registrar of Trade Unions and the appeals system had refused to allow organisation of certain enterprises by the EIWU. The additional material also includes a copy of a Malaysian newspaper clipping dated 15 June 1978 which reports a statement made by a IMF representative concerning the Registrar's refusal to accept electrical and electronic industries as "similar" under the relevant legislation. According to the article, the Registrar's reasons for his determination were the differences in mode of working and methods of production; the Registrar was quoted as denying the IMF's claim that his action had been designed to split the labour movement.
3. 414. In its second communication, dated 8 August 1978, the complainant alleges that the MIEU organised the employees of the Sankyo Seiki (Malaysia) company and that as soon as the MIEU showed proof of majority representation the company recognised this union without any dispute. The complainant adds that, on his own accord, the Registrar of trade unions informed the company that the MIEU was not the suitable union to represent its employees, and that it should not commence negotiations with this union for a new collective agreement. The MIEU forwarded an appeal to the Minister on this case. A similar situation - according to the complainant - developed at the Mitsumi Electric Company when the Electrical Industry Workers Union (EIWU) organised the workers and, in April 1978, served a claim for recognition; the company having replied that it would accord recognition to the EIWU if the Registrar had no objection, the Registrar invited the union officials for a discussion. The officials showed the Registrar various electrical components made by the Matsushita company, which were similar to the products manufactured by Mitsumi. The union contended that, since the Matsushita workers could be permitted to join EIWU, there was no reason why the Mitsumi workers could not do the same. The Registrar, however, classified Mitsumi as an electronic factory and therefore the EIWU was not allowed to unionise its employees. The EIWU has also appealed to the Minister for Labour and Manpower on this case.
4. 415. In its communication of 11 October 1978 the complainant encloses a copy of a resolution on trade union rights in Malaysia adopted by the IMF Central Committee in Helsinki on 29-30 September 1978. The resolution condemns the Government's narrow interpretation of the membership scope of the existing unions and the artificial splitting of Malaysian metalworkers into many different unions. It contains a decision to pursue with the ILO the metalworkers' right to join unions of their own choosing.

B. Reply of the Government

1. 416. In its letter of 23 December 1978, the Government begins by stating that in a developing country like Malaysia it is necessary for the workers to join unions which represent their own or similar industries. The law which requires this, the Government states, covers the workers' right or freedom to choose their own unions. The Government feels that the grouping of workers according to their own or similar industries is logical, effective and fair to the nation, the workers and employers alike. The Government states that, at this stage of its development, Malaysia needs to maintain the existing industrial peace in order to accelerate economic growth and social progress; it recognises the important role played by trade unions in this direction and claims that they have enjoyed greater freedom of association than the union leaders are willing to admit.
2. 417. The Government states that because of the workers' low level of education they are not able to exercise wisely and logically their right to choice of unions and will be too easily influenced into changing union membership at the whim of union leaders without regard for their own interest or the interest of the industries in which they work. It points out this has already happened in the Chemical Workers' Union of Malaya and the National Union of Petroleum and Chemical Industry Workers. The Government adds that the present system of classification of industries and union membership based on similarity protects the workers from such disorganisation and from exploitation by both bad employers and selfish and irresponsible union leaders.
3. 418. Secondly, the Government defends the interpretation of the term "similar" by the Registrar of Trade unions, the deciding authority, and states that he exercises the greatest care to ensure that workers are grouped in the right union according to their industries. Referring to the complaint in relation to the MIEU, the Government suggests that although the MIEU may consider the Registrar's decision as restrictive, the union which was permitted to organise the workers of the Sankyo Seiki (Malaysia) factory, the EIWU, may not consider it so.
4. 419. The Government further states that it does not see it proper at this stage to differentiate between first-degree trade unions and higher-degree trade unions on the question of similarity of industries and therefore does not anticipate any immediate amendment of the law on formation of federations.

C. Conclusions of the Committee

1. 420. This case is concerned with the obstacles encountered by various trade unions in Malaysia in their attempts to build up organisations representing larger sectors of the metal 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 to allow certain unions to organise the workers in individual undertakings are alleged.
2. 421. In a number of earlier cases the Committee has taken the view that it could not reopen a case which it has already examined in substance and in which it has submitted final recommendations to the Governing Body except where new evidence is adduced and brought to its notice. In this case, the IMF, which was one of the complainants in the earlier case, has submitted evidence in support of its allegation that, since the recommendations of the Committee were made to the Government in the earlier case, the position had not changed. It refers, in particular, to two instances where Malaysian unions affiliated with the IMF were prevented by the decision of the Registrar to organise workers in undertakings which, in the opinion of the complainant, operate in fields of activity which are similar to those where the unions in question are recognised as being the representative unions.
3. 422. Under the Malaysian Trade Unions ordinance the right to associate within the same trade union is limited to the workers within any particular trade, occupation or industry or within any similar trades, occupations or industries (sections 2 and 9). It is for the Registrar of Trade Unions to decide what is to be understood by "similar" trades, occupations or industries. There is a right of appeal to the Minister of Labour (section 17) and thereafter to the High Court (section 18). Regarding the forming of federations of trade unions the Ordinance provides, inter alia, that the members of trade unions wishing to federate must likewise be employed in similar trades, occupations or industries (section 72). The new organisation must submit an application for registration upon which the Registrar must act observing the provisions applicable to trade unions (sections 73 and 75).
4. 423. Having examined the complaints and the Government's observations the Committee noted in Case No. 8792 that the word. "similar" referred to in the above provisions 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 or federation of trade unions. The Committee recalled, inter alia, that the right of workers to establish and join organisations of their own choosing was one of the basic tenets of freedom of association. Admittedly, the prohibiting of workers employed in different industries from establishing a single trade union or joining the same organisation might be purely a matter of form, especially if these first-degree organisations were free to establish and join federations and Confederations. However, this could not be so in Malaysia, where restrictive provisions existed 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.
5. 424. Noting that the difficulties encountered in Malaysia in this connection are not of recent origin, the Committee considered that it would be highly desirable for the Government to take steps to ensure that the provisions on the establishment of first-degree trade unions were interpreted in a less restrictive manner by the administrative authorities. The Committee also stressed that the recognition by an employer of the main unions represented in his undertaking or of the most representative of these unions was the very basis for any procedure for collective bargaining on conditions of employment at the level of the establishment. The Committee considered, moreover, that the competent authorities should endeavour to persuade the employers to recognise in any event the union assessed on an objective basis as being the most representative of their employees. This would enable the problem of trade union representativity to be resolved in an equitable manner.
6. 425. On the recommendation of the Committee contained in paragraph 113 of its 177th Report, the Governing Body:
   • (a) drew the Government's attention to the considerations and principles mentioned above with regard to the freedom of workers to choose for themselves the structure of their trade union organisations;
   • (b) suggested, in consequence, that the Government take steps to ensure that the provisions on the establishment of first-degree trade unions are interpreted in a less restrictive manner by the administrative authorities, and consider the amendment of the legislative provisions on the forming of higher-degree trade union organisations;
   • (c) drew the attention of the Government also to the principles mentioned above with regard to the recognition for collective bargaining purposes of the most representative trade union in a given undertaking.
7. 426. The evidence submitted by the complainant in its communications of 3 July and 8 August 1978 appears to show that the interpretation given by the Registrar to the legislative provisions in question has not been revised. In other words, in deciding which union should have the right to organise the workers in a given undertaking, the Registrar continues to apply strict criteria which appear to be based on the method of work and the type of product manufactured.
8. 427. The Committee notes, therefore, that while workers are not denied the right to organise, they cannot always decide by themselves to which union they may belong. The Committee also notes hat in respect of the issues raised in the present case there have been discussions on the matter in Kuala Lumpur, between a representative of the IMF and the competent authorities, which, however, have maintained their point of view.
9. 428. In reply to the new allegations submitted in this case, the Government reiterates its argument 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 interests. Although the Government mentions two instances of such manoeuvring it does not provide details on the alleged abuses by trade union leaders. Although the organisations to which the IMF refers in its complaint, i.e. the MIEU and the EIWU, do not appear to have been involved in these cases mentioned by the Government, the Committee wishes to point out in a general way, as it has in the past, that the principles of freedom of association do not prevent the control of the internal acts of a trade union if those internal acts violate legal provisions, rules or by-laws; nevertheless, in order to guarantee an impartial and objective procedure, this control should be exercised by the relevant judicial authority.

The Committee's recommendations

1. 429. In these circumstances, 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 Committee recommends the Governing Body:
   • (a) to request 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) to take note of this interim report.