You might be surprised to know that the “labour court” in Malaysia doesn’t really exist – at least not in the way many people assume. First of all, the forum which most of us refer to as the labour court is in reality not a court at all.

The labour court in this context refers to inquiries before the Director General of Labour pursuant to Section 69 of the Employment Act 1955 (“Act”).   The Director General of Labour can only hear cases that involve employees whose wages do not exceed RM5,000 a month, or employees who are involved in manual labour regardless of salary. Example of cases heard before the Director General of Labour include:

  • Unpaid wages / other payments in cash due under an employment agreement
  • Claims for payment in lieu of notice (by either employer or employee)
  • Premature retirement before the minimum retirement age
  • Dismissal for misconduct (NB: but the remedies/relief are different from those in unfair dismissal cases heard before the Industrial Court)

Yet, you will not find the phrase “labour court” anywhere in the Act.

So where did the name come from? It is said that the labour court was first enacted sometime in the late 19th century to deal with labourer disputes – in particular the Chinese labourers who worked in tin mines. As the jurisdiction of the labour court was slowly expanded to encompass other labourers, its powers were eventually transferred to the Department of Labour. As “labour court” is easier to say than “proceedings before the Director General of Labour”, we assume this is why we continue to colloquially refer to it as such.

Another factor that could have contributed to the usage of the name “labour court” is because inquiries before the Director General are appealable to the High Court under Section 77 of the Act. Such appeals adopt the same procedure as a civil appeal from a Sessions Court, which further contributes to the treatment of the Director General’s inquiries as that of a subordinate court.

Despite it not being in the Act, official correspodence from the labour office does use the phrase “labour court” or “mahkamah buruh” when referring to inquiries before the Director General of Labour.

What an order from the “labour court” looks like. Note the reference to Section 69C of the Employment Act.

The situation is similar in Singapore, where the name “labour court” is used to refer to hearings before the Ministry of Manpower.  Recently, the Singapore High Court recently suggested that the title “labour court” should be dropped, since it is an unofficial and incorrect name.  The Singapore High Court went on to say that while the title is a “convenient shorthand for everyday use, inaccurate use of nomenclature should cease.” In response, the Singapore Ministry of Manpower is relooking at its use of the name “labour court”.

It remains to be seen whether Malaysia will follow suit. For now, the name of our “labour court” is unlikely to see any change in the near future.

***

ABOUT THE AUTHOR. This article was written by Donovan Cheah.  Donovan Cheah is a partner at Donovan & Ho. He is an advocate and solicitor of the High Court of Malaya, and his writings have been featured in publications like The Edge, The Star, the American Chamber of Commerce updates, and Asialaw.

 

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