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The Collective Bargaining Process

(a) Once a Trade Union is accorded recognition under Section 9 of I.R. Act the Union has the right to invite the employer to commence collective bargaining on behalf of all the employees (except those in the managerial, executive, confidential, personnel and security capacity). The Union has to submit its proposal for a Collective Agreement. The proposals will contain terms and conditions of employment and other benefits which the Union asks for, on behalf of the employees.

Collective bargaining is the process by which the management and the Union meet to discuss, propose, counter-propose, agree, disagree or defer the various items (Articles in the Collective Agreement). It is where each party tries to get the best bargain. The Union wants MORE of wages, allowance, sick leave, annual leave, public holidays, retirement and termination benefits, etc. The management on the other hand tries to MINIMISE labour costs to maximise profit. If both parties agree to all Articles, a C.A. is drawn up and signed by both parties. The C.A. should then be jointly deposited with the Industrial Court for its cognisance.

(b) If the process of collective bargaining fails, the unresolved terms may be referred to the I.R.O. for mediation/conciliation.

If still there is no agreement on all Articles, the I.R.O. will refer the matter to the Director-General of Industrial Relations who will again try to resolve the disputed Articles. If his efforts fail, he will refer the matter to the Minister who may again conciliate on the disputed Articles or refer the matter to the Industrial Court for arbitration. Once the Industrial Court decides on all Articles (disputed and agreed) it becomes an Award of the Industrial Court.

An Industrial Court Award is final and conclusive and is binding on both parties. It cannot be challenged, appealed against, quashed or reviewed by any other court of law, except for reference to the High Court on a question of law (Section 33A and 33B).

If either party fails to honour any of the Articles of a C.A., the other party has the right to file a case of non-compliance against the other party in the Industrial Court. (Section 56). Majority of Industrial Court cases and its Awards are on C.A.'s, dismissal and Non-compliance.

Adopted from A Practical Guide to Malaysian Labour Laws by M.N. D'CRUZ