24 July, 2019
In this article, we examine the recent decision of the High Court in RHB Bank Berhad v Kesatuan Eksekutif RHB Bank Bhd1(“Union”) which had cleared some uncertainties relating to allegations of union busting and/or discriminatory practices raised by the Union.
The matter arose from a complaint lodged by the Union pursuant to section 8(1) of the Industrial Relations Act 1967 (“IRA”) which was subsequently referred to the Industrial Court for determination.
The Union alleged that RHB Bank had engaged in union busting and discriminatory activities pursuant to a job grading and salary structure review exercise conducted by RHB Bank at the material time. The primary ground relied upon by the Union was that there were instances where the junior executive in the lower grade received a higher salary adjustment or increment compared to the senior executive in the higher grade.
The Industrial Court in its Award2 ruled in favour of the union and held that RHB Bank had engaged in union busting action by implementing the new regrading and salary structure and discriminated against the Union members or the Union officials.
RHB Bank filed a judicial review application in the High Court to quash the Industrial Court Award.
Errors of law committed by the Industrial Court
Section 8 of the IRA provides that a complaint can only be lodged with the Director General of Industrial Relations in the event there was any contravention of sections 4, 5, or 7 of the IRA.
In order for the Union to succeed in its complaint, it must first show, to the satisfaction of the Industrial Court, that RHB Bank had breached the provisions of sections 4, 5 or 7 of the IRA.
From the reading of the Award, it was evident that the Industrial Court did not make any findings or determination whatsoever that RHB Bank had contravened any of the provisions of the IRA. This was a crucial error of law committed by the Industrial Court which necessitated the intervention of the High Court.
Another point submitted by RHB Bank was that in order for the Union to succeed in its allegation of discriminatory treatment by RHB Bank, it must be able to show that there was in fact different treatment by RHB Bank for union members and non-union members. All the Union could show at the Industrial Court was that RHB Bank in certain instances gave higher increment to certain employees as opposed to others.
The Industrial Court relied on this in its findings but it committed an error of law when it failed to appreciate that such information is not supportive of the Union’s case as it does not show that there was any discriminatory practice between union members and non-union members.
The Industrial Court also disregarded RHB Bank’s evidence, through its witnesses, that RHB Bank did not know who the members of the Union were as the Union was not recognised by RHB Bank. In fact, one of RHB Bank’s witness testified that he did not know of the existence of the Union at the material time.
The above were some of the factors relied upon by RHB Bank in its application to quash the Industrial Court Award.
The High Court, in its oral judgment, agreed with RHB Bank’s submissions that the Industrial Court had committed serious errors of law and quashed the Industrial Court Award.
The Union has since filed an appeal to the Court of Appeal.
Conclusion
The decision of the High Court makes it clear that it is incumbent on a union to show evidence that there was different treatment of a union and non-union member by an employer to substantiate the allegation of discrimination of union members.
For further information, please contact:
Wong Kian Jun, Partner, Shearn Delamore & Co
wongkj@shearndelamore.com
- High Court Judicial Review No: WA-25-133-05/2018.
- Industrial Court Award No. 462 of 2018.
