This trade dispute referred to this court under s. 26(2) of the Industrial Relations Act 1967 ('the Act') by the Honourable Minister of Human Resources is between Dynamic Management Sdn. Bhd. ('the company') and Persatuan Pentadbir-Pentadbir Ladang Malaysia Barat ('the union').

The dispute between the parties arose as a result of the company unilaterally reducing the annual leave entitlement of its executive employees engaged in the capacity of "managers" and "assistant managers" w.e.f. 1 January 1994. The reduction was as follows:-

(a) Managers - from 30 days to 24 days per year

(b) Assistant managers - from 24 days to 21 days per year.

Upon the reference of the trade dispute being made to the court a statement of case was filed on behalf of the union which, inter alia, contended that the unilateral reduction of the annual leave entitlement of some of its members by the company amounted to an unfair labour practice and is contrary to law. It prayed for an order that the affected employees of the company be given the leave entitlement as it was prior to the reduction.

Then the company applied to the High court for an order of certiorari to quash the reference of the trade dispute to this court and for an order of prohibition to prohibit this court from adjudicating the trade dispute. This application by the company was dismissed by the High court on 7 October 1996. The company did not appeal against the High court decision and thereupon the reference proceeded in this court. A statement in reply was then filed on behalf of the company in which the company, inter alia, contended that:-

(a) the union had not been accorded recognition under the provisions of the Act and therefore the union is not competent to commence collective bargaining with the company under the Act.

(b) the company is entitled to reduce the annual leave entitlement as the company's employees handbook contained a provision which states "The company, however, reserves the right to vary, annul or add to any of the terms and conditions of employment and/or decide which particular terms and conditions of employment shall specifically apply to staff in different locations." (c) the company had improved the terms and conditions of the executives and that the value of these far exceeded the reduction of the annual leave. These were listed as:

(i) Managers were given an allowance of up to RM300 per month in respect of claims for car expenses;

(ii) the company's executives were given option to subscribe for the company's shares under the company's executive share option scheme.

(iii) the executives were entitled to improved medical benefits;

(iv) the executives were given club membership.

(d) the principle of approbation/reprobation applied.

The issue of the union recognition raised in the statement in reply is not material in this case as the trade dispute before the court is not over collective bargaining for a collective agreement. Further, this issue had already been raised and disposed off in the High court in the company's application for order of certiorari and prohibition referred to earlier in this award. The issues for determination by this court are stated to be as follows in the written submission of the learned counsel for the company:

(a) is there any evidence that any of the union's members refused to accept the reduction?

(b) is the company entitled to reduce the annual leave?

(c) does the principle of approbation/reprobation apply?

The evidence before the court shows that the union by a letter dated 9 February 1994 (CL1) wrote to the company as follows:-

It has come to our attention that the annual leave entitlement for plantation executives in your Company has been reduced from 30 to 24 days. We understand the reduction was made unilaterally by the Company and announced by way of a circular.

The Association of West Malaysian Plantation Executives consider this action arbitrary and in contravention of the principle of good labour practices. It is an accepted principle