HRM Principles Practices Oxford University Press Malaysia 2008

HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 1

CHAPTER 2 LEGAL EMPLOYMENT HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 2

PREVIEW q The role and structure of the Ministry of Human Resources. q The purpose of each of the most important labour laws. q Employment Act 1955 q The Employees Provident Fund (EPF) Act 1991 q The Workman’s Compensation Act 1952 q The Employees Social Security Act (SOCSO) 1969 q The Occupational Safety & Health Act 1994 q The Trade Union Act 1959 q The Industrial Relations Act 1967 q Human Resource Development Act 2001 HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 3

ROLE OF THE MINISTRY OF HUMAN RESOURCES The Ministry: v sets policies, v prepares draft employment legislation, and v enforces the employment legislation. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 4

ORGANIZATION CHART MINISTRY OF HUMAN RESOURCES Ministry of Human Resources Department of Labour Department of Trade Union Affairs Department of Industrial Relations Department of Occupational Safety and Health Department of Manpower Department of Skills Development HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 5

OTHER ORGANIZATIONS OF RELEVANCE TO HRM The Employees Social Security Organization Pembangunan Sumber Manusia Bhd National Institute of Occupational Safety and Health Skill Development (Loan) Fund Corporation The Employees Provident Fund HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 6

THE EMPLOYMENT LAWS v The Employment Act 1955 q Set minimum labour standard. q. Seek to protect them from exploitation. q covers groups of employees in the private sectors q. Earn not more than RM 1500 per month. q Groups are cover works as manual labourers, supervise manual labourers and operate and maintain a mechanical. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 7

THE EMPLOYMENT LAWS q Main areas covered by the EA : contract of service, payment of wage, employment of women, working hours and holidays and registers, complaints and inquiries. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 8

THE EMPLOYMENT LAWS v The Employees Provident Fund (EPF) Act 1991 q Scheme to ensure workers have funds available after their retirement. q Employers must register with the fund and responsible to contribute to the funds. q. Contribution rate 11% employees and 12% employers of the employees’ monthly wage. q Wages include fixed allowances, commissions and bonus. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 9

THE EMPLOYMENT LAWS v The Workman’s Compensation Act 1952 q To provide financial compensation to workers who have accidents at work or who contract employment related diseases. q Employer (private) who employ foreign manual workers earning less than RM 500 per month must take out insurance policy to cover liability under the Act. q Inform LO of any accident involving a foreign worker within 10 days of its occurrence. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 10

THE EMPLOYMENT LAWS (cont. ) v The Employees Social Security Act (SOCSO)1969 q Provide protection to workers who may involve in accident at work or who contract some occupational disease. q Designed to ensure workers receive financial compensation for injuries if they are unable to work as well as their dependents under certain condition. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 11

THE EMPLOYMENT LAWS (cont. ) v The Occupational Safety and Health Act (OSHA) 1994 q. Empowered the DOSH to carry out safety inspections at workplaces q Organise promotional activities to improve employers’ and workers’ understand of good safety practices. q. Assist other gov. departs. with technical expertise and to carry out any activities aimed at improving S&H at the workplace. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 12

THE EMPLOYMENT LAWS (cont. ) v The Trade Unions Act 1959 q Workers are permitted to form and joint TU provided these are registered organizations. q. It also consists of procedure for applying registration, use of union funds, the rights and liabilities of unions and other matters relating to the constitution of union. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 13

THE EMPLOYMENT LAWS (cont. ) v The Industrial Relations Act 1967 q To provide systems which encourage industrial hormony. q. Established an IC for arbitration of disputes and lays down procedures for union recognition and Collective Bargaining (CB). q. Include employees reinstatement if workers has been unfairly dismissed. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 14

THE EMPLOYMENT LAWS (cont. ) v Pembangunan Sumber Manusia Bhd Act 2001 q To ensure employers conduct training for their workers to upgrade their skills and abilities. q. Employers are required to pay a monthly levy into a HRDF. q When they organise training programmes or send their workers to approved training programmes, they can apply for reimbursement for the cost incurred. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 15

GROUP DISCUSSION & PRESENTATION HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 16

Purpose of legal employment v Provide v Set v To guideline to the employers & employees minimum standard to the employers avoid and protect employees exploitation v To prevent unfair labour practice to the employees v To promote industrial harmony in the working environment. HRM Principles & Practices © Oxford University Press Malaysia, 2008 All Rights Reserved 1– 17