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TRADE DISPUTETRADE DISPUTE
DCE 5634DCE 5634
INDUSTRIAL RELATIONINDUSTRIAL RELATION
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INTRODUCTION
* DIFFERENCES OCCUR BETWEEN EMPLOYERS AND EMPLOYEE OR THEIR TRADE UNIONS
* INDUSTRIAL ACTION- Employee picketting @ strike - Employer ‘lock-out’
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CLASSIFICATION OF TRADE DISPUTES
•Organising disputes•Recognition disputes•Refusal to bargain disputes•Bad faith bargaining disputes•Negotiation disputes•Interpretation disputes•Breach of contract disputes•Individual disputes
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TRADE DISPUTE AND INDUSTRIAL ACTION
DEFINITIONS
(I) Trade Dispute(II) Strike(III) Picketing(IV) Lock-out
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(I)Trade Dispute
“Any dispute between an employer and his workmen which is connected with the employment or the non-employment or the terms of employment or the conditions of work of any such workmen”.(Industrial Relation Act, 1967, Section (2))
Trade dispute is; (1) between an employer and number of his employees and; (2) over the employment or the non-employment or the terms of employment or the conditions of work any such employees.
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(II) Strike
The cessation of work by a body workmen acting in combination or a concerted refusal under a common understanding of a number of workmen to continue to work or to accept employment, and includes any act or omission by a body of workmen acting in combination or under a common understanding which is intended to or does result in any limitation, restriction, reduction, cessation of or dilatoriness in the performance or execution of the whole or any part of the duties connected with their employment. (Industrial Relation Act, 1967, Section (2))
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“as a concerted work stoppage by a group of workers lasting at least one full day.(Annual Report of the Department of Industrial Relations of the Ministry of labour)
The strike is the ultimate and most favored form of collective action, in that by stopping work and leaving the workplace, the employees clearly demonstrate both the importance of the issue in dispute and their solidarity.
“temporary withdrawal of labour and stoppage of work”
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Types and Causes of Strikes(i) Strikes related to collective bargaining-1.refusal to enter collective bargaining-2.deadlock in collective bargaining(ii) Strikes not related to collective bargaining-1.terms and conditions of contractual terms in collective agreement and other service contracts.-2.retrenchment and lay-off-3.promotion, allocation of duties, transfer, and other management prerogatives.-4.demotion, suspension, warning letter, and other
discipline actions.-5.non-implementation of labor standards and statutory provisions related to other non-monetary benefits. -6.infringements of workers’ right/unfair labor practices-others
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Strike Patterns
3 main indicators- to access strike activity:
Number of stoppages.
2. Number of workers involved -includes those actually on strike and those prevented from working at least for one work-day during the work stoppage.
Number of working days lost. -based on the number of vacancies-during each day of the dispute.
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Number of Strikes, Workers involved and working-Days Lost 1991-2000
Year Number of No. of workers No. of working-
strikes involved days lost 1991 23 4,207 6,110 1992 17 6,110 16,164 1993 18 2,399 7,162 1994 15 2,289 5,675 1995 13 1,748 4,884 1996 9 995 2,553 1997 5 812 2,396 1998 12 1,778 2,685 1999 11 3,452 10,555 2000 11 2,969 6,068Source:Department of Industrial Relations, Ministry of Human
Resources, Malaysia.
Strike By Sector 1995-2000Sector No. of No. of
cases workers involved Agriculture, Forestry, Livestock, And Fishery 18 2,473Mining ad quarrying 1 37Manufacturing 31 7,630 Electricity, gas and Water - -Construction 4 1,061Wholesale & Retail Trade, Restaurant and HotelFinance, Insurance, Real Estate & Business 1 29 Community, Social & Personal Services - -Transport, Storage and Communication 6 524Total 61 11 754
Source:Department of Industrial Relations, Ministry of Human Resources, Malaysia.
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Two Possible Reasons
(i) Location of workers in society.
(ii)Characteristics of the job and worker.
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(III) Picketing
“a gathering of workers outside the workplace or place of dispute with placards and banners expressing workers’ grievances and demands for people to see, thus generating public sympathy and support”. (Aminuddin,1990)
-lawful weapons of workers. (i) simple-picket in the workers’ own time, (ii) no disruption of the business of the employer, (iii) no offence committed in the course of the picket.
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-Objectives(i) To persuade other employees to join or otherwise support the strike.(ii) To withhold supplies or alternative labor from the employer.(iii) To ensure that the strikers do not return to work before the dispute is settled.
-Picketing usually (I) very peaceful (ii) does not pose any threat to the employer, or the place of employment. (iii) does not cause any serious inconvenience to the general public
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(IV) Lock-out (a) The closing of a place of employment; (b) The suspension of work; or(c) The refusal by an employer to continue to employ any number of workmen employed by him.
in consequence of a dispute which is "done with a view to compelling persons employed by the employer . . . to accept terms or conditions of or affecting employment“(Industrial Relation Act, 1967, Section (2))
“The exclusion from work by employers of employees engaged in labour controversies”(M.N.Dcruz, 2001)
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STRIKES INTERNATIONAL SCENARIO
Strikes occur early in the development of a country’s industrial economy and during periods of improving business activity
Strikes are universal in their intent
Methods of conflict resolution tend to universally rely on some form of mediation, conciliation, arbitration, and/or adjudication
Most countries use one or more of these approaches as either a means of preventing or resolving industrial action.
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Countries vary in their definitions of strikes and methods of compiling data and international comparisons also concern the structure of employment.
Strikes are measured in three dimensions: the number of separate disputes, the number of workers going on strike, and the total number of working days ‘lost’. The overall ‘shape’ of strikes can be measured by calculating from the three raw indices the frequency of strikes (number per 1000 employees) and their average size and duration. The product of these gives the overall ‘volume’ or number of days lost per 1000 workers.
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The level of unemployment was, at least until mid 1970s, directly and not inversely related to strike levels in some countries, notably Belgium, The Netherlands and Sweden.
Germany, Sweden and Belgium, unions do not rely on the business cycle for their bargaining power but instead engage in industry- or national level negotiations that contain strikes during booms. It thus appears that not only the level of strikes but also the trend over time varies according to national structures.
Short-term economic conditions, longer-term changes in the composition of the labor force have been seen as causes of changing strike levels.
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IR Act 1967 (S40): Picketing
(1) Allows controlled picketing, whereby the picketing must be in furtherance of a trade dispute
and solely for the purpose of:* Obtaining or communicating information, * Persuading or inducing any workman to
work or abstain from working. Intimidation, obstruction of approach thereto or
egress therefrom (to obstruct the entrance or exit to the organization), and acts leading to breach of peace is punishable by law.
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Picketing Legal limitations imposed on picketing (Wu
Min Aun, 1982) includes:* words used* locality (picketing is allowed at or near the place, and
not ‘in’ the place)
* purpose * form (can not intimidate any person)
* manner (can not obstruct the entrance or exit to the organization)
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IR Act 1967 (S40): Picketing
(2) Any officer or employees of the TU involved may be present at the picketing, but solely for the purpose of maintaining good order and discipline and ensuring that the picketing workmen comply with the law
relating to picketing.
(3) Any person who contravenes the legal restraints imposed on picketing is liable, on conviction, to imprisonment for a term not exceeding 1 year, or to a fine not exceeding RM1,000, or both.
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The rights to strike in Malaysia
IR laws do not clearly lay out the procedures to be followed to ensure the legality of a strike. However, various requirements and restrictions are found in the TU Act and IR Act.
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TU Act 1959 (S25): Strikes and Lock-outs
No trade union workmen shall call for a strike:
* Without first obtaining the consent by secret ballot of at least 2/3 of its total members.
* Before the expiry of 7 days after submitting to the DGIR.
* In respect of matter covered by direction or decision of the Minister given or made in appeal to him under the Act.
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IR Act 1967 (S43): Restrictions on strike and lock-outs in essential services Prohibits any workman in any essential service
to go on a strike:
* Without giving to the employer notice of strike, within 42 days before striking,
* Within 21 days of giving such notice,
* Before the expiry of the date of strike specified in the notice
Employers in essential service are also governed by the same conditions in regards to a lock-out.
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IR Act 1967 - Schedule (pg 47)
Essential Services(Section 2)
* Banking services* Electricity services* Fire services* Postal services* Prison services* Public health services* Telegraph, telephone and telecommunication
services* etc.
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IR Act 1967 (S44): Prohibition of Strikes and Lock-outs
Prohibits strikes and lock-outs under these conditions:
* During the pendency of the proceedings of a Board of Inquiry appointed by the Minister.
* After a trade dispute has been referred to the Court.
* In respect of any of the matters covered by a collective agreement.
* In respect of any of the matters covered under S13 (3) e. g. promotion, transfer, employment, termination, dismissal, and assignment.
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IR Act 1967 (S45): Illegal Strikes and Lock-outs
A strike or a lock-out shall be deemed to be illegal if:
* The motives behind the strike or lock-out are other than the furtherance of a trade dispute. However,
* A lock-out declared on consequence of an illegal strike or a strike declared in consequences of an illegal lock-out, is not illegal.
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IR Act 1967 (S46): Penalty for Illegal strikes and lock-outs
Imposes a penalty in the form of imprisonment for a term not exceeding 1 year or to a fine not exceeding RM1,000 or to both, to any workmen or employer who commences, continues or otherwise acts in furtherance of an illegal strike or lock-out.
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In the context of present Malaysian industrial law, there leaves no room for a justifiable strike.
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Settlement of Trade Dispute
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Methods available for settling disputes . Direct negotiation Fact-finding Machinery final-offer Arbitration Conciliation Mediation Arbitration
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Direct negotiation Direct negotiation is certainly one of the ideal methods Negotiation can also defined as the process of discussing a matter with a view to reaching agreement. A negotiated settlement is seen as a mature and harmonious Initially, negotiation can be envisaged as the two parties stating their relevant positions and, as the process takes place, moving towards a more central position where agreement is possible. A simple illustration of this is frequently seen in wage negotiations
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The process of negotiating contains the following steps:
1) Preparation 2) Argument 3) Movement 4) Close 5) Agreement
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The primacy of voluntary and direct negotiation is reflected in a number of ways:
a) There is a general belief among all the parties, including the government that conciliation or arbitration should not be used
until the normal, jointly agreed negotiating and disputes procedures in the organization or industry have been implemented. b) Have the third party intervention is invoked there is a clear
preference among management and unions for conciliation rather than arbitration and there is no automatic resort to arbitration or conciliation fails.
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c) While in the majority of cases where arbitration does take place it is invoked by a joint request from the two parties. Thus, arbitration may be used not to provide the final settlement but rather to provide a fresh basis for further negotiation.
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Fact-finding Machinery
The Industrial Relations Act allows the Minister of Human Resources to appoint a committee of investigation or a board of inquiry where a trade dispute exists.
Its function is to look into the causes of the dispute and make recommendations either to the Minister (in the case of a committee) or to the House of Representatives in Parliament (in the case of a board).
Fact-finding has been characterized as “a semi-judicial process in which major reliance is placed on the facts of a dispute and the fact-finder and fact-finding board attempts to exercise few mediation principles or tactics.” (Simkin, 1971).
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Final-Offer Arbitration
Final-Offer Arbitration is a binding mechanism in which the arbitrator must choose one or the other of the final offers from the two parties in a contract negotiations dispute.
Both parties need to be ready to compromise their original positions so that, if arbitration is necessary, both final offers look reasonable to the neutral.
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Conciliation
Conciliation can be defined as: A strategy wherein the ‘third party’ supports the direct bi-partite negotiating process by assisting the parties to identify the cause and extent of their difference, to establish alternative solutions and their various implications and to develop and agree a mutually acceptable settlement. The conciliator also acts as a medium for the continuation of the dialogue.
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Goodmnan and Krislov (1974) point out that the conciliator “ has no authority to compel…nor to impose a settlement. Stagner and Rosen describe the conciliator as a “kind of technical consultant to both sides, helping them find a solution. He has only such tools as his prestige as an official mediator, his persuasiveness, his sense of humour and his ability to see the acts as they appear to each of the parties. Under the revised rules for conciliation of the Kuala Lumpur regional Centre for Arbitration, the conciliator may make proposals for a settlement of the dispute only at the request or with the consent of all parties.
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Conciliation is the process of arriving at a settlement of a trade dispute with the help of a third, neutral party. Conciliation can be voluntarily requested by either of the disputing parties or the Director-general of Industrial relations may intervene in a dispute “in the public interest”, requiring the parties to attend a conciliation meeting. Conciliation is the first stage in the Industrial Relation Act for expeditions settlement of trade disputes between the management and the workmen, with the intervention of a third party, namely the Director general of Industrial Relations at the Ministry of Human Resources.
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Mediation
Mediation is a process available to the disputing parties involved in contract negotiations by which an outside party is called to help them reach a settlement.
The mediator is a person who is considered unbiased and impartial and is sufficiently respected and trusted by both parties (Maimunah Aminuddin, 1999).
The mediator’s function is to provide a positive environment for dispute resolution by inviting an extensive experts with professional experience in the field of labor relations.
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Arbitration Arbitration can be defined as : A strategy wherein direct negotiation between management and union is replaced with a process of adjudication which involves the third party in making a decision (award) between the two-conflicting positions. When the disputing employer and union cannot find a solution by themselves or with the help of the Department of Industrial Relations,
In arbitration, an impartial third party is given the authority to settle the dispute by examining the information given by both ideas and making a judgment.
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Dispute Resolution Arbitration Case Flow
Claim Received and Reviewed Claim Served on Respondent
Answer Received and Analyzed
Arbitration List Selection
Prehearing
Discovery
Hearings Held
Arbitration Deliberate
Award Written and Served
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Procedure for dispute settlement in Malaysia
Labour LegislationEmployer Trade Union
Stage 1 Negotiation
Dispute
Stage 2 Conciliation
Collective Minister acts asAgreement Conciliator
Stage 3 Industrial Court
Source: Sharma, B. Industrial Relation in ASEAN, 1996.
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Relative advantages of alternative methods of Dispute Resolution. Cost : Private methods of dispute resolution tend to be less costly than reliance upon outside intervention. Time : the length of time it takes to resolve a dispute can affect the desirability of an alternative method of resolution. Expertise of the decision maker : If outsiders are involved in resolving a labor dispute, those systems which assure an outsider will have some expertise in labor relations are generally preferable.
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Integrity of the bargaining process : Assuming that negotiations are the preferable method for establishing and enforcing job rights, reliance upon any other system as an adjunct to negotiations should reinforce the bargaining process. Privacy : negotiations, arbitration and mediation are generally private processes in which the dynamics of the parties are not subject to public scrutiny. Predictability of the result : a system of dispute resolution which allows the parties to anticipate the likely outcome should facilitate voluntary resolution. Finality : the major problem with negotiations is that it is a system of dispute resolution which lacks of finality.
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STATISTICS ON INDUSTRIAL DISPUTES
The various statistics on industrial disputes can be obtained from the Industrial Relations Department or from the internet. The International Labor Organization (ILO) publishes a comprehensive labor statistics including industrial disputes. Various industrial practices could be determined by comparing statistics from the different countries. The data source of ILO is called LABORSTA, the Labor Statistics Database, ILO Bureau of Statistics and can be assessed through http://laborsta.ilo.org.
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As the data is gathered form various countries, LABORSTA provided definition on the terminologies used in the statistics to ensure uniformity. The definitions are as follows:
The Resolution concerning statistics of strikes, lockouts and other action due to labour disputes, adopted by the Fifteenth International Conference of Labour Statisticians (Geneva, 1993), gives the following definitions for statistical purposes:
A strike is a temporary work stoppage effected by one or more groups of workers with a view to enforcing or resisting demands or expressing grievances, or supporting other workers in their demands or grievances.
A lockout is a total or partial temporary closure of one or more places of employment, or the hindering of the normal work activities of employees, by one or more employers with a view to enforcing or resisting demands or expressing grievances, or supporting other employers in their demands or grievances.
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Workers involved in a strike: Workers directly involved in a strike are those who participated directly by stopping work. Workers indirectly involved in a strike are those employees of the establishments involved, or self-employed workers in the group involved, who did not participate directly by stopping work but who were prevented from working because of the strike.
Workers involved in a lockout: Workers directly involved in a lockout are those employees of the establishments involved who were directly concerned by the labour dispute and who were prevented from working by the lockout. Workers indirectly involved in a lockout are those employees of the establishments involved who were not directly concerned by the labour dispute but who were prevented from working by the lockout.
A labour dispute is a state of disagreement over a particular issue or group of issues over which there is conflict between workers and employers, or about which grievance is expressed by workers or employers, or about which workers or employers support other workers or employers in their demands or grievances.
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Figure 1.0 provides some comparison on the industrial disputes data for some selected advanced and developing countries. The specific data used are explained below:
Strikes and lockouts, by economic activities
If a strike or lockout covers several economic activities, the information about it is usually given under each of the activities involved. As a result, the total number of strikes and lockouts shown for the total (all economic activities together) may be less that the sum for the component activities.
Workers involved, by economic activity The number of workers involved in strikes and lockouts usually includes those involved indirectly as well as those involved directly.
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Days not worked, by economic activity The number of days not worked as a result of strikes and lockouts is usually measured in terms of the sum of the actual working days during which work would normally have been carried out by each worker involved had there been no stoppage.
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Figure 1.0 (A) Statistics on Industrial Dispute for Selected Advanced Countries/
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
AUSTRALIA Stikes & lockout 1036 728 610 560 643 543 447 519 731 698 Workers involved 1181600 871500 489600 265100 344300 577700 315400 348400 461100 325400 Days not worked 1610600 941200 635800 501600 547600 928500 534200 526300 650500 469100
UNITED STATES Stikes & lockout 40 35 35 45 31 37 29 34 17 39 Workers involved 392000 363800 181900 322000 191500 272700 338600 386800 72600 393700 Days not worked 4583600 3988600 3981200 5021500 5771200 4888600 4497100 5115700 1995800 20419400
UNITED KINGDOM Stikes & lockout 369 253 211 205 235 244 216 166 205 212 Workers involved 176000 148000 385000 107000 174000 364300 130000 92700 140900 183200 Days not worked 761000 528000 649000 278000 415000 1303300 234700 282400 241800 498800
JAPAN Stikes & lockout 310 263 252 230 209 193 178 145 154 Workers involved 52762 109296 64007 49009 37542 23196 47185 26291 25673 Dats not worked 96445 231424 116003 85377 76971 42809 110171 101508 87069
FRANCE Stikes & lockout 12 15 10 14 33 6 12 6 7 Workers involved 183000 123100 18400 25500 619688 4858 9310 1257 1253 Days not worked 497300 359200 510900 500500 784000 444100 392600 345800 705120
SWEDEN Stikes & lockout 23 20 33 13 36 9 14 13 10 2 Workers involved 2508 17987 29318 21996 125489 9137 11856 570 9481 163 Days not worked 21724 28141 189828 52398 627291 61348 23579 1677 78735 272
FINLAND Stikes & lockout 284 168 126 171 112 94 91 98 65 96 Workers involved 166772 103505 23193 70535 127039 43113 28402 35380 14993 84092 Days not worked 458338 76094 17316 525703 869422 20078 103713 133203 18954 253838
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Figure 1.0 (B) Statistics on Industrial Dispute for Selected Developing Countries
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000MALAYSIA Stikes & lockout 23 17 18 15 13 9 5 12 11 11
Workers involved 4207 6110 2399 2289 1748 995 812 1778 3452 2969 Days not worked 23448 16164 7162 5675 4884 2553 2396 2685 10555 6068
THAILAND Stikes & lockout 14 33 23 15 39 18 23 8 16 13 Workers involved 10045 8339 6204 8130 16782 8682 11909 2144 7867 5969 Days not worked 236020 235182 242803 81203 219934 92081 150610 213560 142913 225788
INDONESIA Stikes & lockout 130 251 185 296 276 346 234 Workers involved 64530 143005 103490 147662 126855 221247 145559 Dats not worked 582472 1019654 966931 1421032 1300001 2496448 1250403
PHILLIPINES Stikes & lockout 182 136 122 93 94 89 93 92 58 60 Workers involved 55390 47797 35119 48849 54412 32322 51531 34478 15517 21442 Dats not worked 1139809 723689 709584 567702 584179 518860 672730 556796 229248 319233
INDIA Stikes & lockout 1810 1714 1393 1201 1066 1166 1305 1097 565 Workers involved 1342022 1252225 953867 846429 989695 939304 981267 1288923 647678
Dats not worked26428092
31258744
20300653
20983082 16289569
20284803
16971389
22061984
8857731
SOUTH KOREA Stikes & lockout 234 235 144 121 88 85 78 129 198 250 Workers involved 175100 105000 108500 104339 49717 79000 43900 146065 92026 177969 Dats not worked 3257600 1527600 1308300 1484368 392581 893000 444700 1452096 1366281 1893563
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Conclusion Understanding of Trade Disputes is important. IR act defines Trade Disputes: “any dispute between an employer and his
workmen which is connected with the employment or the non-employment or the terms of employment or the conditions of work of any such workmen”.
A Trade Disputes is a dispute:(1) between an employer and any number of his
employees, and(2) over the employment or the non-employment or the
terms of employment or the conditions of work of any such employees.
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Conclusion (cont..) Hagemeyer Industries Sdn Bhd and National Union of
Commercial Workers (Award 75 of 1983), IR court declared:
“the trade disputes definition, covers every dispute between an employer, and his workmen which is connected with the service of the workmen, or with the benefits and privileges incidental to that service.”
and in Teluk Anson Agricultural Enterprise Sdn.Bhd (Arcadia Estate) and National Union of Plantation Workers (Award 139 of 1984), the court stated:
“Non-employment - is the negative of employment, and will come into being in various form...it includes constructive dismissal.”
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Conclusion (cont..)
Dispute resolution:IR act makes available number of ways to resolve Trade Disputes:
(1) Fact Finding(2) Conciliation(3) Arbitration(4) Industrial Action
To prevent as well as tosettle the trade disputes
To settle the trade disputes
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Conclusion (cont..)
IR act assumes that this options/ways can be used to resolve trade disputes only after ..
“ the parties concerned have FAILED to resolve the dispute themselves through NEGOTIATION - the first choice to resolve the trade disputes”
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Conclusion (cont..) DISPUTE RESOLUTION (1) Fact Finding
- provided for in Part VIII of IR Act.- it does not itself resolve a trade dispute but help to resolve the dispute.- two agency fact finding:
(a) Committee of investigation(b) Board of Inquiry
(2) Conciliation- provided for in Part V of IR Act.- one agency - Department of IR
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Conclusion (cont..) DISPUTE RESOLUTION (3) Arbitration
- provided for in Part VII of IR Act.- one agency - Industrial Court.- Industrial Court has jurisdication over trade disputes.
(4) Industrial Action- provided for in Part IX of IR Act.- IR Act acknowledges only the strike, the lockout and picketing as legitimate techniques to settle trade disputes.- Strikes and Lock-out also regulated by Trade Union Act.
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Conclusion (cont..) Trade Disputes cannot be stop or eliminate
permanently. We cannot gurantee of zero disputes. But it can be control or reduced/minimize the
disputes. It’s better to prevent rather than cure. Managing Trade Disputes is important:
(a) maintaining industrial harmony.(b) protect workers & employers(c) social relations(d) increase productivity
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Conclusion (cont..) In Malaysia,
No. of strikes/lock-out No of cases of trade disputes Some of ways to prevent/control trade disputes:
(a) Mutual understanding.(b) Teamwork(c) Each group should play their role(d) Respect and care(e) Complying Code of Conduct Industial Harmony.
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THANK YOU
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