HRM659 Tutorial Chapter 4

1. ARAR Bhd is a public listed company with 2500 employees. The core business of the
company is electrical works related activities. Aman, the company's HR manager,
through the grapevine was made aware of the employees' intention to establish an
employees union. Personally, he supported the idea. Moreover, he likes the idea of
having an in-house union as the company do not have a 'Joint Consultative
Committee'. The recent news on the employees' intention to join the "National Union
of Electrical Workers" really upset him. Using his position and authority, Aman
pressurizes and coerces the employees not to agree with the idea of joint a national
union. He also insisted that, the company will only accord a limited recognition to the
national union. A general recognition will only be granted to an in-house union.

Based on the above scenario, answer the following questions:

a) Explain Aman's rights to insists the employees to establish an in-house union
instead of joining a national union. Justify your answer. (5 marks)

 Persuading at the employer's place of business, during working hours,

another worker to join or to refrain from joining a trade union except with the
consent of the employer
 Intimidating any person to refrain from becoming or to continue to be or to
cease to be a member or officer of a trade union
 Inducing any person to refrain from becoming or to cease to be a member or
officer of a trade union by conferring or offering to confer on any person any
advantage

b) In your opinion, explain any five (5) reasons Aman encourages the establishment
of an in-house union instead of having a national union to represent the
employees. (10 marks)

In-house union are more appreciative of the situation in their workplace and
problems of employer and are less influenced by outsiders. Close relationship
between employer and union will lead to a more peaceful industrial relations. In-
house union also can bring cooperative spirit developed will lead to higher
productivity. Otherwise, Unions help workers to defend themselves also may help
them in increase workers' negotiation power.

2. Explain FIVE (5) usages of union funds in managing union activities (10 marks).

 Used for paying of expenses related to salaries for employees of the union
such as the clerical workers.
 Used for paying of expenses related to the upkeep of an office of trade union.
For example, buy computers, stationery and others related.
 To pay compensation to members for losses arising out of trade disputes
such as strike allowance. So that, it can help them to pay some expense to
support their daily life.
 For union members, allowance will be given when members itself and their
families on account of death, old age, sickness, accident or unemployment
  Used for paying of expenses related to the organization of social, sports,
educational and charitable activities of members

3. Describe five (5) proactive steps that should be taken by a General Manager to
reduce employees' need to form a union. (10 marks)

 Pay higher wages than those prevailing in comparable companies that are
organised in the same locality. Electronics companies are a good example of
organisations using this strategy.

 Give better benefits that suits with their hard working and doing all the
assigned tasks well such as give them bonuses, rest breaks, vacation with
staff and others

 Involve employees in all levels of decision-making and effectively implement

an open-door policy by the elimination of barriers of status. People are
encouraged to interact informally at break times. There will be no separate
dining facilities for management and non management staff. Social occasions
are organised to further foster better relations between staff.

 Offer training, development and a measure of security of tenure. Investment

in training by the company shows that it values its employees and is
interested in their development.

 Develop a climate of trust and loyalty in the organisation. Through regular

feedback techniques, management can gather information about factors that
are causing dissatisfaction. Workers' problems, however trivial, are attended
to and as far as possible solved with the help of the organisation's
management. If resolution is not possible, the workers are told the reason.
There is emphasis on the training of supervisors to be effective, especially in
terms of ensuring that they are fair in assigning duties, evaluating
performance and giving praise and punishment.

4. Briefly explain four (4) reasons some companies wanted to maintain its "union free"
status. (5 marks)

 Union bargain for high demand rather non-member

 Union as a third party intervening the worker-employer relationship a dispute
 Limiting the power of management to run their organization such as the
organization cannot make unilateral policy all the time
 Tarnishing image of company. For instance, make a public protest by holding
a banner that clearly stated the name of the company.

5. Explain eight (8) circumstances in which the Director General of Trade Union can
cancel or withdraw a trade union's registration. (17 marks)

 On the union's own request when if they had after a long time of period after
register.
  The certificate of registration was obtained through fraud. For example, by
doing something unlawful by using the name of trade union.
 The objects or rule of the trade union is contrary to the law.
 If the constitution of the union or of its executive is contrary to the law which
not right in that position.
 If the union was used, is being used or will be used for purposes contrary to
the law or to the rules and regulations of the union itself. For instance,
foreigners and political.
 If the union has broken the provision under TUA or any rules and regulations
as provided under TUA or any rules and regulations of union or formulate any
rules and regulations that is contrary to that provision and continuously being
enforced.
 If the union funds is used illegally or for purposes which is contrary to the law
or to the rules and regulations of the union. For example, transfer a few of
money to the illegal group in others country such as Bahamas.
 If there is more than one union registered in the particular trade, DGTU can
cancel the certificate of registration of union with lesser members (TUA 1959,
Section 15).

6. Explain the importance of registering a trade union. (5 marks)

7. (i) Explain when a trade union can be considered officially formed. (5 marks)

 Every trade union is required to apply for registration from the DGTU within 1
month from the date of its establishment. This period may be extended at the
discretion of the DGTU but it must not exceed 6 months (TUA 1959, Section
8).
 The application for registration must be signed by at least 7 members, which
is also the minimum number needed to form a union.
 Application must be accompanied by the required fees and a printed copy of
the rules or constitution of the union.

(ii) Explain whether registration of a trade union is compulsory. (1 mark)

Yes, because the trade union can be considered to be unlawful association

which can make them refused, withdrawn or cancelled.

(iii) Briefly explain the process of registering a trade union. (7 marks)

1. Appointment of Registrar:
Section 3 of the Trade Union Act, 1926 empowers the appropriate
Government to appoint a person to be registrar of Trade Unions. The appropriate
Government be it State or Central, is also empowered to appoint additional and
Deputy Registrars as it thinks fit for the purpose of exercising and discharging the
powers and duties of the Registrar. However, such person will work under the
superintendence and direction of the Registrar. He may exercise such powers and
functions of Registrar with local limit as may be specified for this purpose.

2. Mode of Registration:
Any seven or more persons who want to form trade union, can apply for its
registration to the Registration of Trade Unions under Section 4 (1) of the Trade
Unions Act, 1926. These applicants must be members of a trade union. In order to
check the multiplicity of trade unions, one school of thought has proposed the
number of persons farming a trade union for the purposes of registration be
reasonably increased to 10 per cent of employees of the unit, subject to minimum of
seven persons employed therein This is expected to strengthen the trade union
movement. The application for registration must be sent to the Registrar of Trade
Unions in Form “A” as required by the Trade Union Act, 1926 under Section 5.

Every application must be accompanied with the following particulars:

 Name the trade union and address of its head quarters.

 Name, addresses and occupations of those members making the
application.
 Names, ages, addresses and occupations of union's officers.
 A printed copy of the rules or constitution of the trade union.
 Other information ad required by the DGTU: Copy of the minutes of
the inaugural meeting.
3. Rights and Duties of Registrar:
Section 7 of the Act empowers the Registrar of Trade Union to make, if
required so, further enquiries on receipt of an application for registration to fully
satisfy himself that the application complies with the provisions of section 5.
However, such enquiries can be made only from the application and not from any
other source.

4. Legal Status of Registered Trade Union:

Upon the registration, a trade union assumes to a corporate body by the
name under which it is registered. A registered trade union shall have perpetual
succession and its common seal. A registered trade union is an entity distinct from
the members of which, the trade union is composed of It enjoys power to contract
and to hold property both moveable and immoveable and to sue and be sued by the
name in which it is registered.
8. Explain two (2) possible employer's attitudes towards employees' intention to form or
to join a union. (3 marks)

 Accommodation
This attitude is one of realism. The employer is prepared to
compromise with the union, tolerate it and be as reasonable as possible. This
is a fairly typical attitude of most large companies today.
 Cooperation
The management works closely with the union to promote the welfare
of the organisation. Joint effort is seen as essential for the survival of the
enterprise.

9. Explain whether local unions can affiliate with other bodies overseas and give three
(3) advantages of such affiliations. (7 marks)

Yes, local unions can affiliate with other bodies, both within and outside the
country by doing any activities together. However, affiliation to foreign bodies
requires the express permission of the Director-General of Trade Unions (DGTU).

Advantages:
1) The internal labour organization will provide assistance, training and funding for
certain projects
2) Tight friendship and help extended by foreign unions and consultative bodies
towards their local counterparts
3) Encourage Malaysian workers to push for increased wages and benefits. So that,
Malaysian products will be less competitive in world market.

10. Sri Winston Sdn. Bhd. is a company involved in manufacturing tyres for airplanes and
has been in operation for more than 3 years. Recently a group of executive and non-
executive employees decided to form a union as several of their complaints and
demands for better terms and conditions were not met. After several discussions
between both groups, they feel that only through a union their welfare can be
protected. Thus, seven days after the meeting, they decided to officially announced
the establishment of their union known as "Kesatuan Sekerja Pekerja Eksekutif dan
Bukan Eksekutif Sri Winston". Two months later, this union decided to invite the
employer for collective bargaining. They believe that only through collective
bargaining they are able to improve the terms and conditions of employment for their
members. Unfortunately, several invitations made to their employer for collective
bargaining were rejected. Frustrated with the rejections, they reported the matter to
the Industrial Relation Department.

a) Comment whether the union is valid or void. Why? (8 marks)

b) Explain the process involved in registering a union. (10 marks)

11. Muaz Sdn. Bhd., a spare-parts manufacturer, was established in September 1991. It
has 250 employees and 70% of the employees had worked for more than 10 years
with the company. Since last year, employees of Muaz Sdn. Bhd. were not very
happy with the company's pay and benefits scheme and also on the current terms
and conditions of employment which they considered way below the market rate.
Even the working condition is not safe and healthy. Several attempts were made by
the employees to voice their dissatisfaction on the matter but it always resulted in
disappointments. As a result, they planned to form a union. Realizing the intention of
the employees to form a union, the company's General Manager reminded the
employees that management would like to maintain its "union free" status. He
warned the employees that if they continue with their intention to form a union, the
company would have no choice but to terminate the employees involved. He
reminded them that the company has the right to terminate employees as their
contract of employment clearly states this prohibition which all employees had
signed.

a) Discuss the legality of the company's actions. (10 marks)

b) What are some of the proactive steps that should have been taken by the General
Manager to reduce employees' need to form a union? (10 marks)

Tutorial Tasks

Group 1—QI a, b

Group 2—Q2, Q4

Group 3—Q3, Q6

Group 4—Q5

Group 5—Q7 (i) (ii) (iii)

Group 6—Q8, Q9

Group 7—Q10 a, b

Group 8—Q11 a, b