INDUSTRIAL COURT OF MALAYSIA CASE NO.

1/6-149/10
BETWEEN KESATUAN PEKERJA-PEKERJA PERUSAHAAN LOGAM AND KONG BROTHERS ENGINEERING SDN. BHD.

AWARD NO : 1180 OF 2010

Coram :

YA PUAN SUSILA SITHAMPARAM MR. JEY KUMAR s/o P. RAMAN MISS LIM SIEW BOON

PRESIDENT EMPLOYEES PANEL EMPLOYERS PANEL

Venue

Industrial Court Kuala Lumpur. : : : 9 February 2010. 25 August 2010 Mr. G. Rajasekaran Secretary General for and on behalf the applicant/union. Mr. M. V. Gopal Senior Consultant for and on behalf the respondent/company.

Date of filing of Form M Date of hearing and oral submissions Representation

AWARD

This was an application by Kesatuan Pekerja=Pekerja Perusahaan Logam (hereinafter referred to as the union) in Form M dated 5 February 2010 for an interpretation of clause 8(iii) of Award 738 of 2006 (hereinafter referred to as the said award) which was handed down in case 15/2-1575/05 (hereinafter referred to as the said application).

The facts

The union and Kong Brothers Engineering Sdn Bhd (hereinafter referred to as the company) had entered into a collective agreement dated 21 May 2001, cognizance number 228/2001 which was for the period of three years commencing 1 May 2000 (hereinafter referred to as the 2000 collective agreement) vide Bundle COB, pages 2 to 18.

A trade dispute arose pertaining to the collective agreement which was to supercede the 2000 collective agreement vide case 15/2-1575/05. The said award was handed down by consent vide Bundle COB, pages 20 to 23. It read:

i)

The 2000 Agreement shall continue to remain in force after its date of expiry, for the period commencing on 1.5.2003 up to 31.12.2007. All terms and conditions, save those relating to the duration of the collective

agreement and sub articles ancillary to it, shall remain status quo. ii) Appendix 1 to the 2000 Agreement shall continue to apply in as far as salary scales are concerned. However, that part entitled Wage/Salary Adjustment shall cease to apply. iii) The Company shall grant annual increments of salary at the rates prescribed, on the due dates of 1.1.2006 and 1.1.2007 to all employees even if employees have reached the maximum of their salary scale as stated in Appendix 1 to the 2000 Agreement. Increments of

salaries so granted shall be on a personal-to-holder basis. iv) Both parties shall incorporate the terms of this award into a collective agreement and submit the same to the Registrar of the Industrial Court for action as

envisaged under 16(1) of the Act.

Initially, the company did not comply with the said award and did not pay the 20 affected employees who had reached the maximum salaries in their salary groups under the 2000 collective agreement their annual increments for the years 2006, 2007 and 2008. Subsequently, they paid them the shortfall in their salaries.

On 20 May 2009, the parties signed a collective agreement for a period of three years commencing 1 May 2007, cognizance number 131/2009

(hereinafter referred to as the 2007 collective agreement) vide Bundle COB, pages 88 to 105. There was a new salary scale for the employees with new maximum and minimum salaries for each salary group. The 20 affected employees also received new maximum salaries under the 2007 collective agreement.

An illustration by the company

There were 20 affected employees who had received their annual increments on a personal-to-holder basis after they had reached their maximum salaries in their salary groups under the 2000 collective agreement in accordance with the said award. The company tendered documents in respect of one of the affected employees by the name of Chandran s/o Narayanasamy vide Bundle COB, page 1. He was a Hydraulic Operator and was paid wages on a daily basis.

Under the 2000 collective agreement, his maximum salary was RM53.82 per day. By virtue of the said award, he was given an annual increment of RM2.23 per day for the years 2006 and 2007 even though he had reached his maximum salary of RM53.82 under the 2000 collective agreement.

Initially, the company did not comply with the said award and paid him RM53.82 per day in 2006, 2007 and 2008. Subsequently, they complied with the said award and paid him the shortfall. After the shortfall of salary was paid to him, he received RM56.05 per day for 2006; and RM58.28 per day for 2007, 2008 and 2009.

When the 2007 collective agreement was signed, his maximum salary was increased to RM58.30 per day with effect from 1 May 2007. He was paid the arrears of salary which was the difference of his new maximum salary of RM58.30 and the salary of RM58.28 per day which he had received from 1 May 2007 until the end of 2009.In 2010, he was paid RM58.30 per day.

The unions contention

The union contended that the 20 affected employees should continue to receive the annual increments on a personal-to-holder basis for so long as they are employed by the company as follows:

Chandran A/L Narayanasamy Murugan A/L Munusamy Nadaraja A/L Kugen Murugusubramaniyam A/L Periannek Selvaraju A/L Nadarajan Chandran A/L Arumugam
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RM4.40 RM4.40 RM4.40 RM4.40 RM5.52 RM5.52

Rajakumar A/L Dorasamy Naikkar Balu A/L Varatharaj Rames A/L Raju Musa Bin Muss Kandasamy A/L Kuppan Chan Yoon Fah Lee Chee Sum Look Peng keong Sammizal Amerasan A/L Periasamy Chang Woon Yieng Imss Thomas Rama Moorthy A/L Thurkayan Ng Sween Chin

RM5.52 RM5.52 RM5.52 RM5.52 RM4.20 RM4.20 RM5.52 RM3.20 RM5.52 RM5.00 RM5.52 RM5.52 RM4.20 RM5.52.

The representative of the union submitted that the 20 affected employees should receive the annual increments at the rate as stated above which is over and above their new maximum salaries under the 2007 collective agreement.

The companys contention

The company contended that it had complied with the said award and denied that the 20 affected employees should receive the annual increments as

stated in the said application which was over and above their new maximum salaries under the 2007 collective agreement.

Decision

Clause 8(iii) of the said award must be read in the context of the whole award. The learned Chairman had referred specifically to the salary scale in Appendix 1 of the 2000 collective agreement.

When the 2007 collective agreement came into force with retrospective effect from 1 May 2007, it did not mean that the new salary scale in Appendix 1 of the 2007 collective agreement was incorporated into the said award.

From the illustration of the salary which was paid to the said Chandran s/o Narayanasamy, the company had complied with the said award.

The 20 affected employees were not entitled to be paid annual increments over and above their new maximum salaries under the 2007 collective agreement on a personal-to-holder basis.

HANDED DOWN AND DATED THIS 7TH DAY OF SEPTEMBER 2010 Signed. ( SUSILA SITHAMPARAM ) PRESIDENT INDUSTRIAL COURT OF MALAYSIA.
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