Once a trade union is accorded recognition under S9 IRA, the union has the right to invite the

employer to commence collective bargaining on behalf of employees (except managerial,

S13(1) states that where a trade union of workmen has been accorded recognition by an
employer or a trade union of employers, the trade union of workmen may invite the employer
or trade union of employers to commence collective bargaining.
According to S13(2), the letter of invitation will be accompanied by a proposal.
Section 13(3) states the matters that could not be included in the proposal by the trade union.
This is known as the management prerogatives which includes promotion, transfer,
termination, allocation of work.
Section 13(2A) allows the trade union to include matters on training, annual review of wage
system and performance based remuneration system.
Proviso to section 13(3) allows the trade union to ask general questions relating to the
procedures of promotion.
According to the case Sime Darby Malaysia Bhd v National union of Commercial Workers,
the trade union is prohibited from discussing any issues that fall within the management’s
prerogative such as termination, dismissal or promotion.
In Non Metallic Mineral Products Manufacturing Employees Union v Syarikat Malaya
Glass, the company had refused to deduct trade union dues from the pay of its employees,
contrary to the previous practice and despite the consent of the employees to the deduction.
The contention of the company was that is not a trade dispute as defined in S2 of IRA. It is
not connected with the employment or non-employment or the terms or conditions of work
or service. The Federal Court accepted the company’s contention and held that it was outside
the jurisdiction of the Industrial Court to make an award on the matter because 'consensual
practice of employees and employers cannot expand the jurisdiction of the Tribunal'.
According to Metallic Mineral Products Manufacturing Employees’s Union v South East
Asia Firebricks Sdn Bhd, considering the statutory hurdles which a trade union in Malaysia
must cross before it secures for itself recognition for collective bargaining purposes, there is
no reason for the law to presume that an employer is at liberty to reject the invitation of a
recognised trade union to join it at the bargaining the table.
 
Collective agreement (sections 14 to 17)
Section 2 of IRA defines a collective agreement as an agreement in writing concluded
between an employer or a trade union of employers on the one hand and a trade union of
workmen on the other relating to the terms and conditions of employment and work of
workmen or concerning relations between such parties.
A collective agreement will get endorsement in Industrial Court and all the terms and
conditions of a particular problem will be stated on paper.
The agreement must fulfilled the requirements in section 14(1) and (2) of the Act. Section
14(1) requires the agreement to be in writing and signed by both parties, while Section 14(2)
requires the details as to the parties; period of the agreement, procedures for modification and
termination and machinery to settle the disputes between the parties to be included in the
agreement.
Besides, Section 14(3) requires the terms and conditions in the collective agreement must be
more favourable than any written law or not in contravention with any written law.
Also, the agreement must be deposited with the Industrial Court in accordance with section
16. Both the trade union and the employer must deposited the agreement to the industrial
Court, in order to be given cognizance by the Industrial Court. Once the agreement is given
cognizance, it is considered as an award of the court and will have a legal binding effect to
the parties.
 
See the cases of :
  National Union of Hotel, Bar & Restaurant Workers v Casuarina Beach Hotel Sdn
Bhd [1986] 2 MLJ 17
 Trengganu Bus Co Ltd v TWU [1983] 1 MLJ 393
 
 
Effect of a collective agreement
Section 17(1) states that a collective agreement which has been taken cognizance of by the
Court shall be deemed to be an award and shall be binding on— (a) the parties to the
agreement including in any case where a party is a trade union of employers, all members of
the trade union to whom the agreement relates and their successors, assignees or transferees;
and (b) all workmen who are employed or subsequently employed in the undertaking or part
of the undertaking to which the agreement relates.
S17(2) provides that as from such date and for such period as may be specified in the
collective agreement it shall be an implied term of the contract between the workmen and
employers bound by the agreement that the rates of wages to be paid and the conditions of
employment to be observed under the contract shall be in accordance with the agreement
unless varied by a subsequent agreement or a decision of the Court.
 
 See the cases of:
 Leng Seng Omnibus v TWU I.C. Award 43/72
 Syarikat Pemandangan Sinar Sdn Bhd v Kesatuan Kebangsaan Wartawan Malaysia
[2001] 3 MLJ 705
 National Union of Hotel, Bar & Restaurant Workers v Casuarina Beach Hotel Sdn
Bhd [1986] 2 MLJ 17
 
Interpretation of a collective agreement
(1) Dispute as to the meaning of the terms in the collective agreement
Section 33 provides that the parties to the agreement or the Minister can refer the dispute on
the interpretation of the terms to the Industrial Court. The industrial court will have the power
to interpret the terms and if needed to change the terms to remove the ambiguity or
uncertainty. Both parties to the agreement must be given the right to be heard before the
Industrial Court determined the question on interpretation.
(2) non-compliance of the collective agreement or variation
Section 56(1) allows the trade union or any person who is bound by the agreement to lodge a
written complaint to the Industrial Court for non-compliance. The Court has a few options
under S56(2), which are to
(i) order the parties to the agreement to comply with any terms in the agreement;
(ii) or to cease or desist from doing any act in contravention of any term of the agreement;
(iii) to make such order to rectify or restitution for any contravention of the terms of the
agreement
(iv) make such orders as it considers desirable to vary or set aside upon special circumstances
any term of the agreement.
Section 56(2A) further provides that the court shall have the power to interpret any matter
relating to the complaint of non compliance.
Section 56(3) made it an offence for any person who fails to comply with the order of the
court under subsection (2).
 
Holiday Inn, Kuala Lumpur v National Union of Hotel, Bar and Restaurant Workers
R lodged a complaint to the Registrar of the Industrial Court alleging that A neglected to
comply with the collective agreement as he had not computed the service charge for the
ordinary and hourly rate of pay for the weekend, public holiday and overtime. A argued that
the collective agreement did not include service charge for computing the ordinary rate of pay
and it was not a contractual obligation to pay service charge pursuant to the collective
agreement. The Industrial Court allowed the claim of the respondent. The Industrial Court
interpreted the collective agreement and held that a share of the service charge is part of the
remuneration of the employees of the A. It also directed the appellant to pay the arrears.