The to a process of negotiation between

The term “Collective Bargaining”
was first used in the early 18th century, ever since the existence
of trade unions. It refers to a process of negotiation between a group of
working people, through unions and an employer. Such negotiation usually involves
employees’ terms of employment such as salaries, benefits, health and safety
policies etc. Through this process, it helps prevent and settle disputes that had
raised between both parties.

In this research paper,
it focuses on the comparative study about the forms and characteristics of
collective bargaining processes in Singapore and Malaysia.

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1.1       Starting
A Collective Bargain

In Singapore, there is
3 different kinds of act that will ensure a successful collective bargaining –
Industrial Relations Act, Trade Unions Act and Employment Act.

Before a collective
bargaining can be conducted, it is a must for the employers to recognize the
union group representing the types of employees. When the union group is being
recognized by the employers, the employers have the option to either dispute
the union’s claim or accept the claim and start the bargaining.

Such matter will then
be passed on to the hands of Ministry Of Manpower, where a secret ballot will
be conducted to see whether the majority of the employees involved in the
bargaining are members of the union, or to find out if they want to be
represented by the union.

The bargaining will be
made compulsory for the employer to accept the claim made by the union if the
ballot shows that 50% or more of them belongs to the union. After recognition,
there can be 2 different kinds of outcome:


1) If employer chooses to object to the union
representing a certain type of employees

The matter will then be settled by MOM or passed on
to Industrial Arbitration Court for a decision. 

2) If the results of the ballot come out with less
than 50%

The union will lose its right to represent the
employees who are involved in the bargaining.


As part of the process
of collective bargaining process, a trade union or employer can also invite
other party to negotiate on “industrial matters”. Which in this case,
“industrial matters” refers to salary and employment conditions.


1.2       The
Collective Agreement

The collective
agreement usually states the type of employees that are being covered. And
since this is a negotiated document between the union and the management, the
union can only take up the case on behalf of its members if there is disputes from
the implementation of the agreement.

For those whom are not
covered under the collective agreement, they are covered by their individual
employment contract if there are any disputes. However, they can form or join a
union to take part in collective bargaining as nobody is allowed to induce
anyone to not join, becoming a member of a trade union.

As for migrant
employees, they can be covered under collective agreement as well as the
agreement is signed based on the type of job, not the origins of the employees.


1.3       Different
Levels Of Collective Bargaining

In private sectors,
there are 2 kinds of level that the collective bargaining can be done at.

Enterprise Level

Industry-based Level

Most common practice
in the private sector.
In this level,
Collective agreements
are signed separately according to employees that different unions had

A rare practice in
the private sector.
In this level,
Industry unions will
meet up with other employers for negotiation. Once a bargaining framework is
established, the unions and employers will carry on with the discussions.
Agreements after that will be signed and implemented at the enterprise level.





In public sector, it
comprises the government ministries, departments and statutory bodies. A public-sector
employee’s eligibility to be represented in a collective bargaining will be
determined by the government.


In this level,
Collective agreements
are negotiated and signed by different unions with each government bodies


1.4       The

The employer or union
representing the employees must respond to the invitation to negotiate within 7
days, if not, the inviting party will engage the Commissioner for Labour to try
to persuade the other party to take part in the negotiation. However, if the
Commissioner understands the reason why the other party is not willing to take
part in the negotiation, he/she will have to notify the Minister Of Manpower
when there is a trade dispute. But such cases, it is rare for one party to
reject to an invitation to engage in collective bargaining.

Under the Industrial
Relations Act, if both parties are not able to reach to a settlement on the
matters being raised, the bargaining will be passed on to the commissioner of
deadlock where he/she will strive to help to help both parties reach to an
appropriate solution or declare a deadlock as a last resort.

Such negotiation is
usually being engaged by a representative from senior management of the company
on behalf of the employer, or even by an external consultant engaged by the

As for the Unions, the
negotiating team is being led by the union’s general secretary, the branch
leaders or industrial relations officer employed by the union.


1.5       After

After the negotiation
between the two parties, the matters that were being discussed will be stated
in the collective agreement, which it must be presented and registered for it
to be implementable.


1.6       Code Of
Industrial Relations Practice

With an increasing pace
of economic change and business restructuring in Singapore, more pressures have
been put on labour management relations, therefore, the code of industrial
relations practice have been issues by MOM to serve as a guidance for both
negotiating parties.


Collaboration, not
Confrontation To treat each other as partners and adopt a consultative
approach to resolving issues, taking into consideration the needs and
concerns of both parties.
Leadership and
Mandate – Both parties should have the authority to negotiate on behalf of
the people they represent and commit to carrying out the agreements. There
should be leadership, direction and responsibility on the part of the
Mutual Trust and
Respect, Understanding and Integrity – Negotiating parties should foster
close ties based on trust, respect and understanding, and deal with each
other with integrity, honesty and good faith.
Sharing of
Information – Parties should share information and engage in an open and transparent
dialogue to promote trust, assist in decision-making and facilitate dispute resolution.
Professionalism –
Parties should adopt a professional approach to industrial relations that is
based on an understanding of human relations and principles that would promote
effective dispute resolution.
Mutuality of Purpose
– All parties should identify common objectives, build a shared vision and
formulate win-win solutions.

Extracted from: I.
(2007 ). 13. ILO Convention No. 154 Concerning the Promotion of Collective Bargaining.
Economic, Social, and Cultural Rights, 1-31. doi:10.9783/9780812205381.142




Trade unions in
Malaysia are considered weak because of the law governing in the country, in
addition, to have an effective negotiation on collective bargains, it is better
to have a strong and independent trade unions, which it is absent in Malaysia.


2.1       Starting
A Collective Bargain

In Malaysia, in order
to have the rights to bargain collectively, it is important that the employer
to recognize the appropriate categories of employees represented by the trade

However, not every
employee in Malaysia has the rights to bargain collectively over salaries,
especially those whom are working in the public sector. Reason being because if
they were given the rights to, there might be a sharp increase in terms
government budget. They are only able to bargain collectively on some other
employment conditions other than salaries.

Those workmen who are
employed in managerial, executive, confidential or security capacity are not
allowed to be represented by a trade union. Which means, a large segment of the
private sector do not enjoy the rights to bargain collectively as well unless
they belong to trade unions which are separated from the trade unions of other


2.2       Collective

Not everything that
falls under employee conditions are negotiable. In Malaysia, the things that
are negotiable in collective bargaining is subject to certain restrictions.
However, if the employer decides to accept a trade unions proposal, there is no
law that will prevent he/she from starting a collective bargaining.

The way Malaysia
approaches to such issues is that they use legislation to decide the issue in
favor of the employers to the loss of the employees.


2.3       Different
Levels Of Collective Bargaining

Enterprise Level

Industry-based Level

Workplace Level

Involves an employer
and trade union that represents the employees.

–       Involves between industrial union and industry based employer’s

–       Involves local employees’ organization and the management of the


In Malaysia, the
parties involved in the collective bargaining can choose to bargain at any
level that they think it suits them and as well as the matters that they are
discussing, but only to a certain extend because Malaysia’s government seem to
prefer the collective bargaining to be enterprise level as they support and
encourage the formation and want to recognize in-house unions even though there
are industrial unions.


2.4       The

The employer or trade
union will have to send out a written invitation to conduct a collective
bargain, the recipient of the invitation will then have to reply with a written
within 14 days to indicate either an acceptance or rejection of the bargain.

If the recipient’s
reply is:


The collective bargain will commence within 30 days
of the recipient’s reply.


The party that initiated the collective bargaining
will have to inform Director General Of Industrial Relations where he/she
will step in to bring both parties to commerce the collective





After considering both
countries in terms of the process of collective bargaining, it is clear about
their differences.

In Singapore, there is
strong presence of independent trade unions which enables effective collective
bargaining, and the collective agreement covers most of the employees. It is
the law that make sure that every employee is protected if there are any

However, in Malaysia,
the absence of strong and independent trade unions made it hard for the
employees to feel protected and represented. Employees in Malaysia are always
in the losing end as it seems that the collective bargaining will always end up
favoring the employers. Therefore, the way they approach such issues is one of
the challenges they faced during collective bargaining in this country – using
compulsory arbitration as the main way of settling trade disputes.




By putting both
countries, Singapore and Malaysia side by side to do a comparative study in
terms of collective bargaining, it is debatable that developing countries like
Malaysia suffers as a result due to a weaker presence of trade unions. Such
situations can be improved by starting to change its method of settling trade