DPB6013 HUMAN RESOURCE MANAGEMENT

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HUMAN RESOURCE MANAGEMENT

For the purpose of (d) and (e), notice shall be given to the superior either by writing
or orally [Sec 40(7)]. Any defect/inaccuracy of the notice shall not be bar unless, the
employer is proved to have been prejudiced by the employee herself [Sec 40(5)].

If she has worked as above, then she would be entitled to maternity protection
which are 60 days of maternity leave & maternity allowance.

However the female employees will only receive a maternity leaves but not
maternity allowance if she does not fulfilled the requirements above. For example
during confinement she already have 6 children (alive). The female employee may
with consent of the employer, commence work at any time during the eligible
period if she has been certified fit to resume work by a registered medical
practitioner [Sec 37(aa)].

For the purpose of maternity allowance, a daily rated female employee will receive
from the employer for each day of her maternity allowance at her ordinary rate of
pay for one day [Sec 37(2)(b)] or if the female employee employed in a monthly
rate of pay shall be deemed to have received her maternity allowance if she
continues to receive her monthly wages during her eligible period [Sec 37(2)(c)].

Whereas if the female employees entitle for the maternity allowance for more than
one employer, she shall not claim an amount exceeding in the aggregate the
amount in which she would be entitled to receive if her claim was made against one
employer [Sec 37(2)(d)]. Then the 2 respective employers shall share the same
proportion of the claims allowance and the employer who pays the allowance may
claim with another employer as a civil debt [Sec 37(3)].

This part also state that the employer have to pay the maternity allowance to the
nominee nominated by her though the female employee death during the
confinement / eligible period or nominated on behalf of her [Sec 39 & 41].

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GAZETTED PAID LEAVES (ANNUAL LEAVE, SICK LEAVE, PUBLIC HOLIDAY AND REST
DAY)
Paid Leaves (Annual Leave)
An employee shall be entitled to paid annual leave of:

(a) 8 days for every 12 months of continuous service with the same employer if
he has been employed by that employer for a period of less than 2 years;

(b) 12 days for every twelve months of continuous service with the same
employer if he has been employed by that employer for a period of 2 years or more
but less than 5 years; and

(c) 16 days for every twelve months of continuous service with the same
employer if he has been employed by that employer for a period of 5 years or more;
and if he has not completed 12 months of continuous service with the same
employer during the year in which his contract of service terminates, his
entitlement to paid annual leave shall be indirect proportion to the number of
completed months of service:
Any fraction of a day of annual leave so calculated which less than one-half of a day
is shall be disregarded, and where the fraction of a day is one-half or more it shall
be deemed to be one day.
An employee who is on paid annual leave becomes entitled to sick leave or
maternity leave while on such annual leave, the employee shall be granted the sick
leave or the maternity leave and the annual leave shall be deemed to have not been
taken.
If at the request of his employer, the employee agrees in writing not to taken annual
leave, he is then entitled to payment in lieu of annual leave.

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Paid Leaves (Sick Leave)

An employee shall, after examination at the expense of the employer:

(a) By a registered medical practitioner duly appointed by the employer; or

(b) if no such medical practitioner is appointed or, if having regard to the nature or
circumstances of the illness, the services of the medical practitioner so appointed
are not obtainable within a reasonable time or distance, by any other registered
medical practitioner or by a medical officer

If there is no hospitalization, the number of days of sick leave shall be:

(i) 14 days in each calendar year if the employee has been employed for less than
2 years;

(ii) 18 days in each calendar year if the employee has been employed for 2 years or
more but less than 5 years;

(iii) 22 days in each calendar year if the employee has been employed for 5 years or
more;

Or If there is hospitalization:

(i) 60 days in each calendar year if hospitalization is necessary, as may be certified
by such registered medical practitioner or medical officer:

An employee who absents himself on sick leave:

(a) Which is not certified by a registered medical practitioner or a medical officer or
a dental surgeon; or

(b) Which is certified by such registered medical practitioner or medical officer or
dental surgeon, but without informing or attempting to inform his employer of such
sick leave within forty-eight hours of the commencement thereof:

 Shall be deemed to absent himself from work without the permission of his
employer and without reasonable excuse for the days on which he is so
absent from work.

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 The employer shall pay the employee his ordinary rate of pay for every day
of such sick leave, and an employee on a monthly rate of pay shall be
deemed to have received his sick leave pa

 If he receives from his employer his monthly wages for the day or days on
which he is on sick leave.

PAID LEAVES (PUBLIC HOLIDAY)
Employment Act = minimum of 10 paid public holidays in one calendar year
Sabah Labour Ordinance = minimum of 14 days
Sarawak Labour Ordinance = minimum of 16 days
Four of the public holidays are specified as follows:

1. National Day
2. Birthday of Yang di Pertuan Agong
3. Birthday of State Ruler (or Federal Territory Day)
4. Workers’ Celebration Day.
Also paid public holiday on any day declared public holiday under Section 8 of Public
Holidays Act 1951
If paid public holiday falls on rest day, then following day shall be substituted paid
public holiday.
By agreement between employer and employee, any other day or days may be
substituted for one of the remaining paid public holidays.
If sick leave on paid public holiday, employer shall grant another day as paid holiday
in substitution.
Any unexcused absence immediately before or after a public holiday will result in
loss of holiday pay for employee

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PAID LEAVES (REST DAY)

Every employee shall be allowed in each week a rest day of one whole day

Where an employee is allowed more than one rest day in a week (places working
on 5-day week) the last of the rest days shall be the rest day:

A daily rated worker who works on a rest day, he shall be paid as follows:

(i) 1 day's wages if the work does not exceed half his normal hours of work; or

(ii) 2 days' wages if the work is more than half but does not exceed his normal hours
of work.

A monthly rated worker who works on a rest day, he shall be paid as follows:

(i) 1/2 day's wages if the work does not exceed half his normal hours of work, or

(ii) 1 day's wages if the work is more than half but does not exceed his normal hours
of work.

For overtime work on a rest day, an employee shall be paid at a rate which is not
less than two times his hourly rate of pay.

COMMON NON-STATUTORY BENEFITS

It is based on customs, precedents or previous court decisions.

Organizations voluntarily provide numerous benefits. These benefits may be
classified as

(1) Payment for time not worked,

(2) Health and security benefits,

(3) Employee services, and

(4) Premium pay.

Generally speaking, such benefits are not legally required.

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TIME OFF PAYMENTS
Paid time off or personal time off (PTO) is a policy in some employee handbooks
that provides a bank of hours in which the employer pools sick days, vacation days,
and personal days that allows employees to use as the need or desire arises.
HEALTH CARE

 Attract and retain the most qualified employees.
 Avoid health care reform assessments.
 Gain tax advantages.
 Take advantage of the small business health care tax credit.
 Offer employees group purchasing power.
 Ensure the wellness of your workers.
FINANCIAL SERVICES
Loans to buy houses, cars and other items such as computer and usually with
interest rates lower than other financial institutions.
SUBSIDIES AND SERVICE
Free or on a subsidized basis.
Canteen and transport to and from work are example of such services as are
children facilities, club membership and accommodation at holiday resorts.
ALLOWANCES
Travel/transport allowance
Meal allowance
Housing allowance
Hand phone allowance
Shift allowance
Standby allowance

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DIFFERENTIATE REWARD IN COMPENSATION

DEFINE REWARDS IN COMPENSATION

Reward, both financial and non-financial, reinforce desirable behavior and spur the
employee on to higher levels of productivity.

The wage and benefit package offered to employee in return for their service, if
well-designed, can attract and help to retain good workers.

This can be done:

a) Conducting a survey of employees and
managers to determine their attitudes
towards recognition

b) Training managers on how to provide
meaningful recognition

c) Help management provide a variety
recognition programmers

d) Track the result of recognition programmer

Financial rewards are something given or received in recompense for worthy
behavior or in retribution for evil acts. Financial rewards are the pay and benefits
that workers receive in return for work, though others might include praise from
superiors and a sense of career progression. Furthermore, financial rewards are
also advantageous to employees because they increase the likelihood of personnel
staying with the company, allowing employers to retain experience and knowledge
base, and providing workers with a measure of familiarity and stability. An
employee who earns enough to cover his basic needs and some extra will be less
likely to give notice and look for another job, saving himself the stress of a job
search and saving his employer the hassle of having to replace a valuable worker.

Non-financial rewards, in employment, a reward to a worker other than extra pay.
Many non-financial rewards are perks such as company cars, free private medical
care, and free pension entitlement. However, an employee may be rewarded, for
example, by being given a better office or a bigger budget to control, or by being

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given the choice of where to take a posting in a company. Non-financial rewards
can be very cost-effective for companies because, in contrast with a pay increase,
little or no income tax or national insurance contributions are paid.

COMMON FINANCIAL REWARDS
SALARY INCREMENT
It is relatively easy to managers to reward top performance with an increase in
salary
Salary increases based on performance must be linked to a performance appraisal
scheme
BONUS AND PROFIT SHARING
A bonus is a supplemental payment as an incentive or reward for hard work, it is
often connected directly to performance, such as generating more sales or
motivating a production line to meet or exceed a quota. Knowing there is a tangible
financial reward for increased productivity can be precisely the kind of motivation
many employees need. Employees can use the promise of bonus pay to entice
managers to motivate their subordinates towards a specific goal. Sometimes
simply maintaining an accident-free work environment can result in a performance
bonus for supervisors’ managers.
SHARES
Employee stock-option programs give employees the right to buy a specific number
of a company’s shares at a fixed price for a specified period of time (usually around
then years)
Option a company can award to employees is usually equal to a certain percentage
of the company’s share outstanding's

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COMMON NONFINANCIAL REWARDS
PERFORMANCE AWARDS
Value of performance awards “worker of the Month”, “Most promising Executive”
and other.
A merely a certificate or thy may also involve a cash prize or a souvenir item.
Wire-up on company notice boards, journal or a special price giving ceremony
LETTERS OR APPRECIATION
Relate to the quality of the performance
Signed by at least a Head Department or higher ranking manager.
SPONSORSHIP TO SEMINAR, CONFERENCE AND OVERSEAS TOURS
To both the employee and the employer if high achievers are sent to attend
seminars, conference and possibly on an overseas tour to visit a parent company,
supplier or consumer.
REWARDS FOR LONG SERVICE
Some token of appreciation
A gold watch, a gold bar, a trip overseas, a special dinner event or combinations of
these items were common.

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Summarize DPB6013
Define the concept of compensation for employee
Classify components of compensation HUMAN RESOURCE MANAGEMENT

- Financial compensation 107 | P a g e
o Direct financial compensation
o Indirect financial compensation

- Non-financial compensation
Identify Malaysian legislations related to compensation
- Employment Act 1955
- The Sabah Labor ordinance
- The Sarawak labor ordinance
- Workmen’s Compensation Act 1952
Benefits provided to employee
Interpret statutory benefits
- Employee provident fund
- Employee social security
- Maternity protection
- Gazetted paid leaves

o Annual leave
o Sick leave
o Public holiday
o Rest day
Common non0statutory benefits
- Time off payments
- Health care
- Insurance
- Financial service
- Subsidies and services
- Allowances
Define rewards in compensation
Describe common financial rewards
- Salary increment
- Bonus and profit sharing
- Shares
Describes common non-financial rewards
- Performance awards
- Letter of appreciation
-

DPB6013

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8.0 INDUSTRIAL RELATION

CONCEPT OF INDUSTRIAL RELATION IN MALAYSIA
Industrial relation is sometimes knows as labour relations or employee relations.
The term industrial relations usually refers to the relationship between an employer
and his employees, particularly when the latter are members of a trade union.
Define the concept of industrial relation and tripartite system
Systems that encourage industrial harmony. It is for the regulation of relations
between employers and workmen or employees and their trade union and the
prevention and settlement of trade disputes.
The term ‘industrial relations’ comprises two terms: ‘industry’ and ‘Relations’.
‘Industry’ refers to any productive activity in which an individual (or group of
individuals) is (are) engaged
Industrial relations/labour relations: study of relationship between employees and
their employers pertaining to the employee’s employment or non-employment,
terms and conditions of work, grounds of termination of employment, etc.
It also refers to the management of employee’s welfare and internal
communications.
Industrial relations stresses the importance of 3 major areas:

• Relationship between employers and trade unions
• The framework provided by the employment laws
• Disciplinary procedures and termination of the employment

contract

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IMPORTANT OF INDUSTRIAL RELATION
● One of the important aspects in human resource management
● To create a harmonious relation between employer and employee
● To ensure that employees receive fair and just treatment and avoid conflicts
in organization

INDUSTRIAL RELATIONS SYSTEM IN MALAYSIA
● Made up of three parties/or the tripartite systems:
– Employer
– Employees (represented by union)
– Government
● Industrial Relations Act 1967 –use to regulate the relation between
employer and employee
● Code of Conduct for Industrial Harmony 1975 was introduced to maintain
harmonious relation between employer and employee
– There are 47 issues covered regarding employer and union
responsibilities, collective bargaining, etc.
– Generally, IR in Malaysia is controlled by the government.

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TRIPARTITE SYSTEM IN MALAYSIA
• Is recognised as a tripartite system and is made up of 3 groups and Ministry
of Human Resources act as a president. His role is to oversee the overall
development of discussion.
• Includes
• Employers and their organizations.
• Employees and their unions.
• Government.

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MACHINERY FOR DISCUSSION IN TRIPARTITE SYSTEM.
1. National Labour Advisory Council (NLAC) which is made up of 14
representatives from employees, 14 from employers and 12 from
government.
2. Minister of Human Resources will chair the NLAC meetings and appoints the
government representatives.
3. Other representatives are appointed after consultation from Malaysian
Employer’s Federation (MEF), Malaysian Trade Union Congress (MTUC) and
Congress of Unions of Employees in Public and Civil Service (CUEPACS).
4. Meeting is held twice a year or when there is urgency (e.g.: to approve
amendments to the law).

ROLE OF EMPLOYERS AND THEIR ORGANIZATIONS
• Promote and protect the interest of their members
• To negotiate and deal with trade unions of employees
• To represent their members in any trade dispute between an individual

member and employee’s union

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IDENTIFY THE RELEVANT ACTS WITH REGARDS TO INDUSTRIAL RELATION

THE INDUSTRIAL RELATION ACT 1967

This act regulates the relationships between employers and their workmen through
trade union including:

 To provide and encourages harmonious relation between employers
and employees.

 To provide guidelines on collective bargaining between employers
and employees.

 To establish procedures for settlement of trade disputes.

Trade Union Act 1959

This act establishes the responsibilities of trade unions and their members
including:

 To provide the rules on the right of employees to form, join and
participate in any lawful trade union activities.

 To provide the rules on the right of employers to form, join and
participate in any lawful employer’s association activities.

 To establish and promote legislation affecting the interest of the
trade union member.

Employment Act 1955
 This act stipulates regulations covering all aspects of employment of
workers.
 Among provisions covered are termination, working hours, maternity and
sick leave benefits and wage payments. The provisions aim to safeguard
against exploitation by employers. The specific coverage including:

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 To provide minimum benefits for those workers covered by the act.
 To establish certain rights for employers.
 To establish certain rights for employees

ROLES THE MINISTRY OF HUMAN RESOURCES IN INDUSTRIAL RELATIONS
The Ministry of Human Resources plays a major role in the Malaysia Industrial
relations system. It is responsible for preparing the legislation which establishes the
right of employers and employees. Once Parliament passes the laws, the Ministry
is required to enforce their implementation.

SCOPE
Encompass employee and workers state of safety, health and welfare and human
resource matters such as training, employment, labour rights and industrial
relations.
ROLE & STRUCTURE
Government’s overall goal in the area of Industrial Relations is to encourage
harmonious relationships between employers and employees in the interest of the
nation’s productivity
ROLES OF THE MINISTRY OF HR IN INDUSTRIAL RELATIONS

 To protect the welfare of the employees- safety, and rights
 To promote good employer-employee relationship through a stable and

peaceful Industrial Relations system
 To equip the unemployed with basic industrial skills and to improve the skill

level of the workforce
 To assist in maximizing country’s manpower resources through manpower

planning

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TRADE UNION IN ORGANIZATION

DEFINE TRADE UNION IN ORGANIZATION

Section 2, under Trade Union Act- “Trade Union is any association or combination
of workmen or employers...whose place of work is in West Malaysia, Sabah or
Sarawak...”

a. Within any particular establishment, trade, occupations or industries; and

b. Whether temporary or permanent; and

c. Having among its objects one or more of the following:

The regulation of relations between workmen and employers for
the purposes of promoting good is between workmen and
employers, improving the working conditions or enhancing their
economic and social status, or increasing productivity;

The regulation of relations between workmen and workmen, or
between employers and employers;

The representation of either workmen or employers in trade
dispute;

The conducting of....or dealing with trade union disputes and
matters related thereto; or

The promotion, organization or financing of strikes or lockouts in
any trade or industry or the provision of pay or other benefits for its
members during a strike or lockout.

Objective:

i. regulation of relations between workmen and employers for the purpose
of promoting good industrial relations between workmen and employers,
improving working conditions or enhancing their economic and social status
or increasing productivity,

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ii. Regulation of relations between workmen and workmen or between
employers and employers.

iii. Representation of either workmen or employers in trade disputes.
iv. conducting of, or dealing with, trade disputes and matters relating thereto,

or
v. promotion or organization or financing of strikes or lockouts in any trade or

industry or the provision of pay or other benefits for its members during
strike or lockout

TRADE UNION (TU)
TU Functions:

– Protecting TU members through collective strength;
– Economic controller – represent employees on issues such as salary

and employment contract
– Support and help employees, such as advise and counselling, benefit
– Input provider to government on issues related to employees
Membership of TU
According to Industrial Relations Act (Section 5); workers in Malaysia have the right
to form and join TU –FREEDOM OF ASSOCIATION
In addition, The Act states that:
– No employer shall prevent a worker from joining a union by putting

a condition in his contract of employment;
– No employer shall refuse to employ a worker on the grounds he is a

TU member or officer;

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– No employer shall discriminate against a worker (for example in
terms of promotion) on the grounds he is a TU member or officer;
and

– No worker shall be threatened with dismissal or dismissed if he
proposes to join a TU, OR if he participates in union activities.

TYPES OF TRADE UNION
IN-HOUSE TRADE UNION
Is a Trade Union whose members are all employed by the same employer in the
same place of employment.
Example; Telekom berhad Employee Union, Tenaga Nasional Employee Union etc.
Advantages

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a. They are more appreciative of the situation in their workplace and
problems of employer and are less influenced by outsider. Close
relationship between employer and union will lead to a more
peaceful industrial relations.

b. Cooperative spirit developed will lead to higher productivity.

Disadvantages
c. Generally weak because membership is limited and confined to
workers in one particular company
d. Leaders are chosen from a small number of members and this give
rise to the possibility of exploitation by employer.
e. Union financial strength limit its union activities.
f. Fear of victimization by employer among leaders (managerial
prerogatives).

PUBLIC SECTOR TRADE UNION
Public sector consists of the civil service, the statutory bodies and the local
authorities.
In 2003, there were 211 unions in this sector and include the National Union of the
Teaching Profession and the Malayan Nurses Union.
Trade Union Act provides that employees in the public sector can only form and
join unions whose members are in the same ministry, department or occupation.
This is to ensure that discussions are possible with the employer on a logical basis.
Wages and other terms of services are discussed at the national level between the
government and CUEPACS.

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EMPLOYER’S TRADE UNION
Employers can also form unions or associations
The employers are more likely to form an association of their own.
Example; Malayan Commercial banks Association (MCBA) and Malayan Agricultural
producers’ Association (MAPA)

THE PERSONS WHO ARE PROHIBITED FROM BECOMING A MEMBERS OF TRADE
UNION
Who can join a union?

• Under section 26, 27 and 27A of Trade Union Act, the following classes of
persons are prohibited from being members of a union:

• Any person below the age of 16 years,
• Any student of an educational institution established by or under any

written law, unless he is also
• Employed as an employee and is over the age of 18 years,
• Any person employed in the establishment or industry or trade or

occupation in respect of which the
• Union is registered, and any public officer, unless exempted by Yang Di

Pertuan Agong.

However, certain group of government employees is not allowed to join trade union
at all:

• Members of the armed forces, police force and any prison service,
• Public officers prohibited under any law from forming or joining a union,
• Public officers employed in a confidential or security capacity,

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• Public officers holding any post in the Management and Professional Group.

SECTION 26, 27 AND 27(A) OF TRADE UNION ACT 1959

THE REASONS WHY WORKERS JOIN TRADE UNION

Dissatisfaction with management
 Underpaid salary
 Dangerous work environment
 No job security/warranty
 Less concerned about employee welfare Social Needs
 Platform to get to know other people
 To benefited from facilities provided by union (e.g.; onsite day care
center) Leadership opportunity
 Opportunity to demonstrate leadership abilities
 There are organizations that incorporate union leader’s position into
their formal organizational structure (usually the lower level
management) Peers Influence
 Pressures from supervisor and co-workers to join TU

FIVE REASON WHY WORKERS JOIN TRADE UNION

i. Job security
Employees need to have a sense of job security and want to be sure that
management will not make unfair and arbitrary decisions about their
employment. They look unions to ensure that their jobs are duly protected
against layoffs, recall, promotion, etc.

ii. Wages and benefits
Employees work for livelihood, i.e, bread-and-butter. Obviously, bread-and-
butter issues of employees are always important issues in their unionization.
The employees may think that the union, with its united strength, will

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ensure fair wages at par with those of other workers in the community,
benefits such as medical facility, pensions, paid sick leave, vacations and
holidays for them.
iii. Working conditions
Employees like to work in a healthy and safe environment. Although there
are statutory provisions for providing employees safe work environment
employees still feel more secured knowing that trade union is directly
involved in safety and health issues relating to them.
iv. Fair and Just Supervision
The days are long gone when managers/leaders could rule employees with
an iron fist. Thanks to the trade unions that bought about a change or shift
in leadership styles from autocratic to democratic, or say, people oriented
to ensure that the managers treat their employees fairly, justly, and
respectfully. Employees can only be disciplined for “just cause”. In case of
mistreatment from the employer, the employee may file a written grievance
against the employer. The complaint will be heard and resolved through a
formal grievance procedure involving collective discussion by both union
and management representatives.
v. Powerlessness
Employees individually often dell voiceless or powerless to bring about
changes that will benefit them. But, it is union that provides them a
powerful, collective voice to communicate to management their
dissatisfaction and frustration. This is based on labor philosophy unity is the
strength.
vi. Need to belong
Man is social. Hence, need to belong is strong in both his personal and work
lives. The union, from this point of view, provides a mechanism for bringing
people together not only to promote common job-related interests but also
to organize programmers, functions, and social events from time to time, to
create a strong bond among the union members. To conclude, the
management’s failure in ensuring job security, fair remuneration, safe and
healthy working conditions, fair supervision, and involvement in decision
making, sense of belonging etc. To employees motivates them to join a
union.

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COLLECTIVE BARGAINING IN ORGANIZATION
COLLECTIVE BARGAINING IN ORGANIZATION
Collective bargaining can be defined as a method to determine work terms and
conditions as well as to control work relations through the negotiation process
between employers and employees in the hope of achieving an agreement.
Bargaining process between employer and their employees regarding terms and
conditions of service/employment
Union will represent employees in CB
Union needs to be registered in order to get recognition from employer before
representing employees in CB
Four important issues usually bargained:

Wage/benefit
Work hours
Employment terms and conditions
Grievances
Prerequisites to effective CB are that the union:

Be recognized by the employer;
Has adequate financial strength; and
Members are united
The outcome of CB is known as collective agreement

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COLLECTIVE BARGAINING PROCESS
SET BARGAINING ISSUES
PREPARING FOR NEGOTIATION

 Preparation: At the very first step, both the representatives of each party
prepares the negotiations to be carried out during the meeting. Each
member should be well versed with the issues to be raised at the meeting
and should have adequate knowledge of the labour laws. The management
should be well prepared with the proposals of change required in the
employment terms and be ready with the statistical figures to justify its
stand.

NEGOTIATING THE ISSUES
 Discuss: Here, both the parties decide the ground rules that will guide the
negotiations and the prime negotiator is from the management team who
will lead the discussion. Also, the issues for which the meeting is held, are
identified at this stage.

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OVERCOME THE IMPASSE/BREAKDOWNS
 Propose: At this stage, the chief negotiator begins the conversation with an
opening statement and then both the parties put forth their initial demands.
This session can be called as a brainstorming, where each party gives their
opinion that leads to arguments and counter arguments.

REACHING THE AGREEMENT
 Bargain: The negotiation begins at this stage, where each party tries to win
over the other. The negotiation can go for days until a final agreement is
reached. Sometimes, both the parties reach an amicable solution soon, but
at times to settle down the dispute the third party intervenes into the
negotiation in the form of arbitration or adjudication.

RATIFYING THE AGREEMENT
 Settlement: This is the final stage of the collective bargaining process,
where both the parties agree on a common solution to the problem
discussed so far. Hence, a mutual agreement is formed between the
employee and the employer which is to be signed by each party to give the
decision a universal acceptance.
 Thus, to get the dispute settled the management must follow these steps
systematically and give equal chance to the workers to speak out their
minds.

ADMINISTRATION OF THE AGREEMENT

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INDUSTRIAL ACTION IN ORGANIZATION

DEFINE INDUSTRIAL ACTION IN ORGANIZATION

As per Section 2(k) of Industrial Disputes Act, 1947, an industrial dispute in defined
as any dispute or difference between employers and employers, or between
employers and workmen, or between workmen and which is connected with the
employment or non-employment or the terms of employment or with the
conditions of …

Causes of Industrial Disputes. The causes of industrial disputes are many and varied.
The major ones related to wages, union rivalry, political interference, unfair labour
practices, multiplicity of labour laws, economic slowdown and others.

METHODS OF INDUSTRIAL ACTION

PICKET

The most common form of industrial action taken by employee

Done to communicate issues to the public and to embarrass the employer

Prominent display of banners and placards with derogatory comments about their
employer and management

The Industrial Relations Act (Section 40) allows workers to attend at, or near, their
workplace during trade dispute for the purpose of peacefully giving info to the
public and other workers and to persuade other workers not to work if a strike has
already been declared.

Only workers directly involved in the dispute can participate in the picket (although
an officer or employee of the union can be present to ensure that the picketing is
carried out according to the law)

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 They do not obstruct the exits or entrance
 The do not intimidate anyone
 Their activities are peaceful

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STRIKES
Occurs when a group of workers refuse to work until their employer accepts their
demands
Involves stopping of work by a group of employees including any attempt to limit
or slow down production on purpose
2 types of strike:

 Strike relating to collective bargaining
 Strike that has no relation to collective bargaining
Strike relating to collective bargaining
 when employer is not willing to provide collective bargaining or no

resolution during collective bargaining
Strike that has no relation to collective bargaining

 Due to factors such as terms and conditions of employment,
retrenchment, layoffs and promotion issues

Strike Procedures:
 Secret ballot must be held by those eligible to strike, clearly stating
the issues leading to the proposed strike
 The results of this ballot must be sent to the Director-General of
Trade Union s by the union secretary within 14 days of taking the
ballot
 Strike can only take place if two third of those entitled to vote agree
to the action
 Strike can take place after waiting 7 days after the ballot results have
been sent to the Director-General

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 Secret ballot is only valid for 90 days, and if strike has not taken place
within this period, a new ballot will be required if the union intends
to continue with the strike action

LOCK-OUT
Lock-out is a way for employers to force employees to accept their demand.
Through this, employers will not allow employees to work until the dispute
between them is solved.
This include actions such as closing the work place until they agree to the work
conditions imposed. Similar to a strike, the requirements to a lock-out are also
subject to the law.

INDUSTRIAL DISPUTE IN ORGANIZATION
INDUSTRIAL DISPUTE IN ORGANIZATION
Employer Actions
Employer also has the right to engage in industrial action
The most common industrial action taken by employer is the lock-out
Employer refuses to allow the workers to work until the dispute between them is
settled
Alternatively, the employer can take steps to fight a strike by keeping the firm
operating; either by placing managerial or non-union employees in the strikers’ job
or by hiring replacement workers

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PROCEDURE IN SOLVING INDUSTRIAL DISPUTE

DIRECT NEGOTIATION

• Direct negotiation is a dispute resolution technique process at the beginning

• The parties may or may not be assisted by a professional neutral who is
trained at facilitating communication to achieve a resolution.

• The parties collectively retain complete control over the process and its
outcome. Together the parties specify the ground rules and schedule, select
the professional neutral, and establish procedures for when and how they
communicate, listen and respond.

CONCILIATION

A process whereby the Department of Industrial Relations helps to settle disputes
between employers and employee. When a trade dispute exits between an
employer and his employees, either the employer or the union representing the
workers can report the matter to the Director-General of Industrial Relations.

Alternatively, if it comes to the attention of the Director-General that a dispute exits
and is unlikely to be settled by direct negotiation between the two parties, he can
require the employer and the union to attend a conciliation meeting.

Whether the conciliation services of the Department of Industrial Relations are
voluntarily requested by the parties to a dispute or they are required to attend a
meeting, the conciliation process is basically the same. An officer of the Department
will be assigned to meet the disputing parties, and after discussions with them, the
officer will make suggestions as to how the dispute might be settled. Because he is
neutral and an “outsider”, he may be able to offer some useful recommendations
which the parties find acceptable. The conciliator has no authority to settle any
dispute. He merely tries to bring about a settlement by using his skills as a
“middleman”.

The majority of disputes are settled by using the conciliation machinery. Those
disputes which are not resolved at this stage will be reported to the minister of
Human Resource who may the dispute to the Industrial Court for arbitration.

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MEDIATION

Defined as a process of assisted negotiations and its key qualities are described.
This is a good primer for those contemplating mediation.

A 3rd party neutral who opens communications and facilitates the negotiation
process. This process may or may not include legal counsel at the party’s discretion
but is not a binding process unless the parties reach an agreement.

ARBITRATION

Is a settlement of a dispute between an employer and his employees by a neutral
third party, which is under the IR Act, the industrial Court is empowered to settle
the trade disputes. Court awards are binding and cannot be appealed except on
questions of law.

SUMMARIZE
Define the concept of industrial relation in Malaysia
The relevant acts with regards to industrial relation

- The industrial relation act 1967
- Trade union act 1959
- Employment Act 1955
The roles the ministry of Human Resource in industrial relations
Define trade union in organization
Types of trade union
- In-house trade union
- Public sector trade union
- Employers trade union
The person who are prohibited from becoming a member of trade union
The reasons why workers join trade union
Define the concept of collective bargaining
Collective bargaining process
Define industrial action
Methods of industrial action
- Picket
- Strikes
- Lock-out

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REFERENCE

Raymond A Noe, John R. Hollenbeck, Barry Gerhart, Patrick M. Wright. (2004).
Human Resource

Management (5th ed). USA: McGraw-Hill

Dessler, Gary. (2008). Human Resource Management (11th. ed). Singapore:
Pearson Prentice Hall.

Jon Ingham. (2006). Strategic Human Capital Management: Creating Value
Through People. UK:

Butterworth Heinemann.

Michael Armstrong. (2009). Armstrong's Handbook of Human Resource
Management Practice (11th ed).

USA: Kogan Page Limited. ISBN 978 0 7494 5242 1.

Robert L. Mathis, John H. Jackson. (2007) Human Resource Management (12th.
ed). USA: Thomson South-

Western.

Tan, Chwee Huat and Torrington, Derek (2004) Human Resource Management in.
Asia, (3rd. ed). Singapore:

Pearson Prentice Hall.

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PAST YEAR
QUESTION

1. 1. List FIVE (5) basis that can be used to compare between human resource

management and personnel management.

(5 marks)

2. Describe TWO (2) internal and TWO (2) external factors that affect human

resource management activities. (10 marks)

3. Explain FOUR (4) methods use to collect data in conducting job analysis.

(10 marks)

4. Describe FIVE (5) activities involved in human resource planning process.

(10 marks)

5. Explain THREE (3) common methods of performance appraisal.

(9 marks)

6. Identify THREE (3) common errors made during performance appraisal.

(6 marks)

7. Interpret FOUR (4) types of selection test in choosing the best candidates as

a new employee. (10 marks)

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8. Before organize training program, a training need analysis should be carried

out. Implement THREE (3) level of training need analysis in enhancing

training and development for a company. (9marks)

9. As Human Resource Manager at Pet Oil & Gas Company, you are responsible

to plan training is designed to overcome lack of skills and knowledge issues

among them. Relate any TWO (2) methods of “On Job training” that can be

applied in the given situation. (6 marks)

10. Interpret FIVE (5) non-statutory benefit given to the employee.

(15 marks)

11. Explain THREE (3) common methods of performance appraisal.

(9 marks)

12. Identify THREE (3) common errors made during performance appraisal.

(6 marks)

13. Determine FOUR (4) procedures that can be used in solving an industrial

dispute such as salaries and working conditions. (10 marks)

14. List down FIVE (5) functions of human resource management. (5 marks)

15. Explain TWO (2) internal factors and TWO (2) external factors that can affect

human resource management roles. (10 marks)

16. Describe Job Description and Job Specification. (4 marks)

17. Identify any THREE (3) methods of collecting information in conducting job

analysis. (6 marks)

18. Human resource planning is the anticipation movement of workers either in

or outside the organization. Identify FOUR (4) importance of human

resource planning. (10 marks)

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19. Besides manager, there are several individuals who are given the authority

to appraise the workers in the performance appraisal process. Discuss any

THREE (3) sources of performance appraisal. (9 marks)

20. Performance appraisals are often exposed to errors which occur during the

process. Explain any THREE (3) errors that are faced during the employees’

performance appraisal process. (6 marks)

21. Explain FIVE (5) external recruitment methods that can be used in an

organization. (10 marks)

22. Identify THREE (3) importance of training and development of employees in

an organization. (9 marks)

23. Due to the expansion of business activity, your company has received few

additional permanent workers from the headquarters. As the Human

Resource Manager, you are responsible to explain to them the statutory

benefits provided to employees. Interpret THREE (3) types of statutory

benefits as mentioned above. (15 marks)

24. As an Industrial Relation officer, you are required to determine FOUR (4)

procedures that can be used in solving industrial dispute. (10 marks)

ALL THE BEST & GOOD LUCK IN
YOUR LIFE

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