Union busting is the act of weakening or destroying a labor union. In Malaysia, the prohibition against union busting is safeguarded by several key legislations, including the Employment Act 1955, Industrial Relations Act 1967, and Trade Unions Act 1959. One significant protection against union busting is enshrined in section 5(1)(c) of the Industrial Relations Act 1967, which prohibits discrimination against individuals because of their union membership or leadership positions when it comes to employment, promotions, working conditions, or any other employment-related matters. While it might seem straightforward that a deliberate refusal to promote a qualified employee due to their union membership constitutes a violation of this provision, the situation becomes more complex when a union member is promoted because of their union affiliation. This article discusses the case of Kesatuan Eksekutif Airod Sdn Bhd v Airod Sdn Bhd [2014] 4 ILR 398, where a Union President was promoted against his wishes. The court’s findings shed light on the intersection of union membership and promotions. Brief Facts

  • The Union President was promoted to a managerial grade without his consent or consultation.
  • Although the Union President queried the Company whether he could continue being a union member in light of his promotion, he did not receive any response.
  • When the Union President later confronted the Company over some union affairs, the Company was of the view that the Union President’s promotion had resulted in him being disqualified to be a union member. As such, the Company requested the Union President to cease being a union member.
  • The Union President objected to the Company’s demands, as he did not accept the promotion in the first place.
  • Ultimately, the Company took disciplinary action against the Union President and demoted him.
  • The Union lodged a complaint and this was referred to the Industrial Court.

Court’s Findings The Industrial Court held that the Company’s action amounted to union busting, as the Company’s motive was to ensure that the Union President fell out of the Union’s membership and could no longer lead the Union whilst the first collective agreement was litigated in court. In reaching its decision, the Industrial Court also observed that the Union’s President’s promotion process was different from the past practice, as employees would usually have a choice to decide whether to accept the promotion. Ultimately, the Industrial Court ordered the Company to remove the records of the Union President being promoted and demoted.   Key Takeaways  Promoting a union member, on its own, does not qualify as union busting, as affirmed by the High Court in RHB Bank Berhad v Kesatuan Eksekutif RHB Bank Bhd & Anor [2019] 1 LNS 1007. The issue arises when promotions are perceived as discriminatory against union members or when they carry ulterior motives aimed at stripping them of their union affiliation. Employers should therefore engage in open dialogue with union employees when contemplating promotions that involve relinquishing union membership. Unequivocal consent should be obtained before the promotion takes effect. Further, adhering to the promotion procedures outlined in the company’s policies or collective agreement can play a vital role in averting misunderstandings. It will also mitigate the risk of allegations that could tarnish the goodwill of an otherwise well-intentioned promotion.

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This article was written by Leow Ho Eng (Associate) from Donovan & Ho’s employment law practice.  Donovan & Ho is a law firm in Malaysia, and our employment practice group has built a reputation for providing strategic employment advice to local and global organisations.  Our team of employment lawyers provide advice on employment law and industrial relations including review of employment contracts, policies and handbooks, advising on workforce reductions, and managing dismissals of employees for poor performance or misconduct. We also represent clients in unfair dismissal claims and employment-related litigation.

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