Mokhtar Sidin JCA:

The appellants in the present appeal were employed by the respondent in different capacities and belonged to a category of workers called "High Tech" employees. They were beneficiaries under a collective agreement first signed in 1996 by the respondent and KPPEPMI (the inhouse union of the employees). The appellants were members of the union which the Industrial Court had taken cognizance under that collective agreement and subsequent collective agreements. The respondent undertook several contract works with the Malaysian company known as Petroliam National Berhad (hereinafter referred to as "Petronas") outside the territorial seas of Malaysia in particular adjacent to the State of Terengganu. On 19 February 1995, the appellants filed their claims against the respondent with the Labour Department, Dungun claiming the following:

(a) Kerja pada hari cuti rehat mingguan RM 5,017,246.50

(b) Cuti tahunan 171,434.08

(c) Gaji kerja lebih masa 6,977,883.18

(d) Perbezaan gaji kerja lebih masa 965,057.47

Jumlah RM13,131,571.23

The appellants first lodged their claims with the Labour Department, Dungun on 6 February 1995. Apparently, this was not acted upon immediately by the department. It was only after 13 January 1997 (almost two years later) the department took steps to look into the complaints, after the solicitors for the appellants threatened to invoke the order of mandamus against the department and proceeded to act under s. 70 of the Employment Act, whereby on 21 April 1997 it issued a summons to the respondent and set a date to hear the complaints. Even though the hearing dates had been fixed several times but due to the request for adjournments by the parties, the complaints were finally heard on 10 December 1997.

In the meantime, the Minister for Human Resources promulgated the Employment (Exemption) Order 1997 which was gazetted on 29 September 1997. This was eventually replaced by the Employment (Exemption) (No. 2) Order 1997 (hereinafter referred to as "the Exemption Order") which was gazetted on 18 October 1997.

The Employment (Exemption)(No. 2) Order, 1997 provides:

In exercise of the powers conferred by section 2B of the Employment Act 1955, the Minister makes the following order:

1. This order may be cited as the Employment (Exemption)(No. 2) Order 1997 and shall be deemed to have come into force on 1 October 1974.

2. Petroliam Nasional Berhad and any of its contractors and subcontractors of such contractors are exempted from the provisions of Part XII of the Act, in so far as they are engaged in the business or service relating to or connected with, whether directly or indirectly, the exploration, exploitation, winning and obtaining of petroleum.

3. This exemption applies in relation to the employees of Petroliam Nasional Berhad and its contractors and subcontractors of the contractors, whose place of work is within the territorial waters or the Exclusive Economic Zone or the Continental Shelf of Malaysia.

4. In the absence of any collective agreement and where the terms and conditions of service in the contract of service entered into by the contractors of Petroliam Nasional Berhad and the subcontractors of such contractors, with their respective employees, relating to the conditions of service provided in Part XII of the Act are, in the opinion of the Minister, unfavourable to the employees, the Minister may prescribe other terms and conditions of service for the employees.

5. The Employment (Exemption) Order 1997 is revoked.

As can be seen, although the Exemption Order was gazetted on 18 October 1997, it was to take effect retrospectively from 1 October 1974.

When the complaints were heard on 10 December 1997, the Exemption Order was already gazetted. The respondent, on the date of the hearing, raised the preliminary objection that the claims by the appellants came within the Exemption Order and as such the Labour Court had no jurisdiction to hear the claims by the appellants. The Labou