January 2021
There are two major changes to employment law that came into effect recently that employers should be aware of. This alert summarises the amendments introduced to the Industrial Relations Act 1967 and the Employees’ Minimum Standards of Housing, Accommodations and Amenities Act 1990.
A. Industrial Relations (Amendment) Act 2020 (“IRA Amendment Act”)
A majority of the provisions in the IRA Amendment Act came into effect on 1 January 2021, save for certain provisions relating to trade unions and the amendment to the list of essential services. The key changes to the Industrial Relations Act 1967 (“IRA”) as a result of the IRA Amendment Act are as follows:
1. Automatic referral to the Industrial Court
Previously, the Minister of Human Resources had the discretion whether or not to refer unresolved representations relating to unfair dismissal to the Industrial Court. The Amended Act shifts the power to refer representations to the Director General of Industrial Relations (“DGIR”) who does not have the discretion to decide whether or not to refer unresolved representations. Instead, the DGIR now must refer unresolved representations to the Industrial Court. Similarly, there is now no discretion not to refer to the Industrial Court disputes relating to capacity of a workman and claim for recognition by a trade union to represent any workmen or any class of workmen.
2. Representation at conciliation meetings
A party (employer or employee) may now, with the written approval of the DGIR, be represented by any person of their choice (except an advocate and solicitor) during the conciliation stage at the Industrial Relations Department.
3. Continuation of proceedings after claimant’s death
The Industrial Court can continue to conduct unfair dismissal proceedings notwithstanding the death of the claimant who brought the claim and if the claimant is found to have been unfairly dismissed, award backwages or compensation in lieu of reinstatement or both, to the next-of-kin of the deceased claimant.
4. Power of the Industrial Court to impose interest
The Industrial Court can now impose interest of up to 8% per annum commencing on the 31st day from the date of making the award until the day the award is satisfied.
5. Penalty for non-compliance with award
The penalty for non-compliance with an Industrial Court award or collective agreement and for contravening a provision of the IRA and its regulations and any summons, orders or directions given under the IRA has been increased to RM50,000.
6. Appeal against the decision of the Industrial Court
A party who is dissatisfied with an Industrial Court award may appeal to the High Court within 14 days from the date of receipt of the award. This is a significant development from the former regime in the IRA as the aggrieved party is no longer required to bring a judicial review application (which is limited to a review of the decision-making process and not the merits of the decision) in order to challenge the decision of the Industrial Court.
7. Trade union’s power to raise questions
Trade unions are now empowered to raise questions of a general character relating to promotion, transfer, employment for a vacancy, termination due to redundancy, dismissal and reinstatement and the assignment or allocation of duties in the course of any discussion with an employer or trade union of employers.
B. Workers’ Minimum Standards of Housing and Amenities (Amendment) Act 2019 (“WMSA Amendment Act”)
The WMSA Amendment Act came into effect on 1 September 2020 and amends the provisions in the Employees’ Minimum Standards of Housing, Accommodations and Amenities Act 1990 (“Amended Act”). The Amended Act applies in Peninsular Malaysia and the Federal Territory of Labuan. It bears noting that several investigations were commenced for possible breaches of the Amended Act in the midst of the Covid-19 pandemic.
The Amended Act imposes additional responsibilities relating to employees’ accommodations on employers who provide accommodation to their employees and “centralized accommodation providers” (“CAP”).
One such responsibility is to obtain a Certificate for Accommodation from the Director General of Labour Department (“DG”) before providing accommodation to employees. Additionally, an employer is required to notify the DG within 30 days of its employee occupying the accommodation.
The Amended Act requires the buildings used as centralised accommodation be be fit for human habitation and the accommodation be maintained as directed the DG. Besides, accommodation provided must comply with minimum standards under the Amended Act or its regulations. The accommodation provided must have decent and adequate amenities. Elaborating on these requirements is the Employees’ Minimum Standards Of Housing, Accommodations and Amenities (Accommodation And Centralized Accommodation) Regulations 2020 (“Regulations”). The Regulations provides that the accommodation must meet stipulated minimum requirements, which includes having a rest area, dining area, sleeping area/bedroom, kitchen and others. The Regulations also stipulates the basic amenities to be provided which are not to be shared, namely beds, mattress and locked cupboard of stipulated specifications.
An employer or CAP who provides accommodation must ensure that every accommodation provided meets safety and health requirements. They include providing separate accommodation to employees of the opposite gender, taking preventive measures to ensure employees’ safety and well-being, taking fire safety measures and taking preventive measures to contain spread of infectious diseases.
A person in charge of accommodation must be appointed, who is responsible for the well- being of the employees and management of the accommodations and amenities. The duties of this person includes ensuring employees comply with the employer’s disciplinary rules, visiting the accommodation twice a month and taking employees to a clinic or hospital if he/she is unwell.
The Amended Act further requires employees to vacate the accommodation provided to them within a stipulated period after their resignation or termination.
This material is for general information only and is not intended to provide legal advice. If you have any queries regarding the above, please feel free to contact us at insights@chooi.com.my.