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2014 MarsdenLR 298
INDUSTRIAL COURT KUALA LUMPUR
NATIONAL UNION OF EMPLOYEE IN COMPANIES MANUFACTURING RUBBER PRODUCTS – Appellant
Versus
ANSEL COMPANIES OPERATING I.... – Respondent
Award No: 1025 of 2014 [Case No: 1/1-1369/13]
A collective agreement remains binding until varied, and any non-compliance, such as merging allowances with basic wages, constitutes a breach of contractual terms.
Headnote:(A) Industrial Relations Act 1967 - Section 14(2)(c) and Section 17(1) - Non-compliance with collective agreement - Respondents' preliminary objections dismissed - Court found collective agreement valid despite absence of modification clauses and continued to apply until superseded - Meal allowance dispute due to minimum wage implementation - Respondents charged with breaching agreement by merging allowance into basic wage without notice. (Paras 4, 9, 32, 62)
Facts of the case:
The complainant claimed that the respondents stopped meal allowances for workmen after basic wages were raised to comply with minimum wage standards, which the respondents denied, arguing allowances were merged into wages as per new regulations. (Paras 16, 18)
Findings of Court:
The court ruled in favor of the complainant, stating the collective agreement’s meal allowance provision was binding, and the respondents failed to demonstrate any special circumstances justifying a change. Ordered to pay arrears to affected workmen. (Paras 55, 63)
Issues: The key issues were whether the collective agreement was void due to lack of modification clauses and whether the respondents' absorption of meal allowances into basic wages constituted compliance with the agreement. (Paras 4, 9)
Ratio Decidendi: The court held that a collective agreement, once taken cognizance by the court, becomes binding as an award and remains in force until varied; merging allowances violated the explicit terms of the agreement establishing mandatory payment. (Paras 9, 62)
Result: Respondents ordered to comply with collective agreement and pay overdue meal allowances.
| Table of Content |
|---|
| 1. application for order of non-compliance (Para 1 , 2 , 3) |
| 2. preliminary objections regarding collective agreement validity (Para 4 , 5) |
[1] This is an application for an order of non-compliance of article 32 clause (F) of the tenth collective agreement dated 6 February 2010, cognizance number 58/2010 (hereafter referred to as "the said collective agreement") by the National Union of Employees In Companies Manufacturing Rubber Products (hereinafter referred to as "the said complainant") against Ansell Companies Operating in Melaka namely Ansell Malaysia Sdn Bhd, Ansell Medical Sdn Bhd and Ansell N.P. Sdn Bhd (hereinafter referred to as "the said respondents").
[2] The preliminary objection which was raised by the respondents was heard on 5 May 2014 before a coram which comprised of the learned President, Encik Simunir bin Abas, the member from the Employers' Panel and Mr Ng Choo Seong, the member from the Employees' Panel. That coram dismissed the preliminary objection.
[3] The continued hearing was fixed on 23 and 27 June 2014. Mr Ng Choo Seong informed the court subsequently that he was not available on those dates as he would be attending a conference overseas. The court appointed Mr Prem Kumar s/ o Appukutty to replace him. Both parties had no objections.
Preliminary Objection
[4] On 5 May 2014, counsel for the respondents raised a preliminary objection that the said collective agreement was void as the said collective agreement had not complied with s 14(2)(c), Industrial Relations Act 1967 (hereinafter referred to as the said Act) which provided that a collective agreement should contain a provision for the modification and termination of the said collective agreement.
Section 14 (2)(c) reads:
"14. (2) A collective agreement shall set out the terms of the terms of the agreement and shall, where appropriate:-
(c) prescribe the procedure for its modification and termination."
[5] The second ground for his preliminary objection was that the said collective agreement had expired on 31 December 2011 as it was for a period of three years. He contended that the complainant could not apply for an order of non-compliance of the said collective agreement as it had expired.
