Industrial Court system must be revamped

 

I was once on the Industrial Court “bench” as one of the 3 arbitrators that hears cases under the Industrial Relations Act – matters of dismissals, collective agreements, grievances etc. The arbitrators comprised a “neutral” judge as chairman, an employees’ representative (meaning from the union), and an employer’s representative (in this case, me),

The particular case before us was about a Chinese man (this is relevant) alleging unfair dismissal by a big, Chinese-owned company (this is also relevant). He was dismissed on the 8th of August 1988 or 8.8.88. Somebody remarked the employer must have really hated him, to have dismissed him on such an auspicious date.

The man was instructed by his lawyer to speak only in Chinese, which meant everything had to be laboriously translated to and from English. Sometimes in his excitement he’d slip into English, which he was perfectly capable of speaking, only for his lawyer (Indian) to immediately shush him.

It felt like a Malaysian comedy, and perhaps it was.

After weeks of this charade, the trial ended. We arbitrators discussed the case in chambers. The chairman started by saying “poor guy, how is he going to get another job at his age” etc. I could see where that was heading.

I urged that we review the evidence first before coming to a verdict. But the chairman said the company was rich and could afford to pay, and in any case he must rush to his next appointment. As he and the employee’s representative were in agreement, he then declared a majority decision for the ex-employee, and bade goodbye.

And that was that. After barely half an hour’s deliberation, we came to a judgment based, in my view, on ideology rather than the merits of the case. That was the last time I was on the Industrial Court panel, and the last time the Industrial Court had me on its panel. No big loss either way.

Bias against rich companies

My experience of the hearing is pretty much how the Industrial Court works most of the time. The court itself isn’t hostile or discriminates against employers, but there’s a real bias against “big companies which can afford it”.

That sucks. But I also blame employers. They often don’t take the Industrial Court seriously, leaving it to their HR minions and lawyers –often not very good minions or lawyers – to handle the cases, which often means they’d lose.

So it is that the notion that this “court is always on the employee’s side” ends up over time becoming a self-fulfilling truth.

A cultural issue is a big cause of many employment grievances. Many Malaysians still see their job as their “right”, often describing it as their “rice bowl”, a sure sign they’re overdependent on their employers.

This kind of relationship was common enough in the past. I used to work in a bank where a staff member was the third generation of his family to work there. His father and grandfather worked there until retirement, and he fully expected to do so too. To them, the bank was more of a benevolent master than just an employer.

Many in the public sector have another argument on top of the “rice bowl” argument – that of “serving the nation”. That’s a working relationship that over time can easily become toxic.

Rice bowl loyalty

When I became the first in my family to get a proper salaried job, my mother was so happy she actually prayed for the success of my employer, even when I worked for the bank, that bastion of capitalism and many other isms, none good.

It helped to condition me to value my job (my “rice bowl”), but also taught me never to take anything for granted. As quickly as companies hire, they also fire – a “management prerogative” whose bona fides the Industrial Court often has to decide.

The employer often holds the upper hand in a job, especially where ownership of financial capital matters, But increasingly, in today’s “human-capital” world, employees may also hold the upper hand.

And increasingly, employee loyalty is becoming less valued, or even a negative quality. Pledging your entire working life to one employer with the expectations the employer will reciprocate the loyalty doesn’t quite work any more.

I used to get my hackles raised when I heard about “loyalty”; while it can indeed be valuable, many workers are also loyal only because they couldn’t get a better job elsewhere. It is just foolish to hope a company can guarantee your job when many companies themselves are not sure about their own future.

Social justice and the law

Employees can terminate their employment through serving notice or compensating in lieu. Technically employers have the same rights too, and under civil contracts laws, that would indeed be the case.

But the Industrial Court is different. Employment contracts aren’t seen as civil contracts, and employers have fewer rights than what the employment contract actually says. The Industrial Court considers itself the guardian of social justice rather than just for legal consistency, and often makes decisions accordingly.

The Industrial Court is technically a part of the nation’s justice system, with binding and enforceable legal powers, but it also occupies the lowest rung in the judicial system.

It doesn’t quite get the respect it deserves, and is often unnoticed and unloved – that is, until it comes out with some newsworthy decisions, such as some huge financial awards to the petitioning employee, as has been happening more regularly lately.

Then eyebrows are raised, as they should.

Looking ahead

We’ve neglected the Industrial Court for too long, never defining or challenging its role in a changing society. Perhaps those awards are the Industrial Court’s way of saying “Hey, look at me! I exist!”

Employers’ associations must push for an efficient and responsive justice system on employment law that suits today’s employment challenges. Unfortunately, that’s difficult to achieve, as many CEOs are as much a stone-age throwback as the employees and unions that they encounter.

An Industrial Court that’s not fit for purpose can be an injustice to both employees and employers, and a disincentive for investors and entrepreneurs, who’ll get frustrated with dealing with a system that isn’t relevant to current needs.

We don’t need to go the Singapore way, where the labour court is very employer-friendly. We certainly don’t want to go the full American “employment-at-will” way, where a boss can fire you at any time with no reason needed.

I think as a society we’re OK with employment being treated as more than just a contractual matter, although not to the extent of guaranteeing somebody’s “rice bowl”. I hope the ministry of human resources and employers can take the initiative to revamp the setup, even if the employees (i.e. the unions) aren’t likely to be happy. - FMT

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.