For as long as most Malaysian employers can remember, trade union representation followed a simple pattern: one workplace, one union. That is no longer the position.

Labour law reforms that took effect in 2024 have reshaped how trade unions are formed and recognised, and, for the first time, a company may face more than one trade union competing to represent the very same employees.

If two trade unions both claim to speak for the same group of workers, must the employer recognise both, and which union does it actually negotiate a collective agreement with? The answer lies in the recognition and sole bargaining provisions of the Industrial Relations Act 1967 (“IRA”), read together with the recent amendments.

Why the Question Now Arises

Previously, the Trade Unions Act 1959 (“TUA”) defined a “trade union” by reference to workmen within a particular establishment, trade, occupation or industry, which limited how trade unions could be formed. The Trade Unions (Amendment) Act 2024 (“TUAA”) removed that language, opening the door to more than one union organising the same workforce.

The IRA was amended in parallel. The sole bargaining rights provisions in sections 12A and 12B, introduced by the Industrial Relations (Amendment) Act 2020, exist because the law now anticipates multiple unions being recognised by the same employer, requiring a mechanism to decide who negotiates on behalf of the employees.

Recognition: The Gateway to Representation

Before a trade union can deal with an employer on behalf of a class of employees, it must first be accorded recognition. The process begins when a union claims recognition from the employer. The employer, in response, has the following options within 21 days of being served with a claim for recognition:

(a) voluntarily accord recognition; or
(b) refuse recognition and notify the trade union of the reasons for its decision.

If the employer refuses recognition or does not respond to the claim for recognition, the trade union may, within 14 days of receipt of the notification or 21 days of service of the claim, report the matter to the Director General of Industrial Relations (“DGIR”).

The DGIR may take such steps to ascertain whether the union is competent to represent the employees and may conduct a secret ballot to determine whether the majority of the workmen support the trade union seeking recognition. Once these steps are completed, the DGIR shall give his decision on the claim for recognition.

Recognition is the statutory gateway to a union having the standing to represent a defined group of workmen.

Once accorded, recognition is protected for a defined period. Under section 11, no other union may claim recognition for the same group of workmen unless one year has elapsed, or the recognised union ceases to exist. Section 12 adds that a union whose claim has been withdrawn or refused may not make a fresh claim for the same group for six months. Together, these provisions limit competition by unions over representation and give the workplace stability.

When More Than One Trade Union Is Recognised

Recognition is always given for a particular class of workmen, such as executive or non-executive employees. It is therefore common for more than one union to operate in a single company where each union represents a different class of workmen.

The question of multiplicity arises only when more than one union seeks to represent the same class. The restrictions in sections 11 and 12 are limits of timing, not permanent bars to recognition. Once the one-year window has elapsed, another union may claim, and obtain, recognition for the same class.

The IRA therefore accepts that a company may, in time, have more than one recognised union for the same group. This then raises a pressing question: which union does the employer bargain with?

Sole Bargaining Rights: Who the Employer Negotiates With

The IRA answers this through the concept of sole bargaining rights. Where more than one union is recognised for the same class of workmen, section 12A provides two routes.

The first route is for the recognised trade unions to decide among themselves which union is to hold the sole bargaining rights, and to notify the DGIR.

Alternatively, if there is no agreement, the employer, a trade union of employers, or any union concerned may apply in writing to the DGIR to decide which union holds the sole bargaining rights.

On an application being made under the second route, the DGIR may take such steps to determine the application or to make such inquiries by way of secret ballot to ascertain which union has the highest support among the employees.

A union holding the sole bargaining rights is given a mandate of three years to represent the workmen in negotiating with the employer. During this period, no other union can claim those rights unless the union holding the sole bargaining rights ceases to exist. For employers, this provides clarity as to which union to negotiate the collective agreement with.

What This Means for Employers

(i) Recognition and sole bargaining rights are distinct:
Recognition confers the right to represent a class of workmen; sole bargaining rights confer the exclusive right to negotiate the collective agreement. An employer may recognise more than one union but will negotiate with only one.

(ii) Employers must bargain with the sole bargaining rights holder:
Where more than one union is recognised for the same class of workmen, the employer’s bargaining counterpart is the single union holding the sole bargaining rights, not every recognised union.

(iii) Employers may apply to resolve a deadlock:
Where the recognised unions cannot agree on who is to hold the sole bargaining rights, the employer may apply to the DGIR for the question to be determined by secret ballot.

(iv) Sole bargaining rights are protected for three years:
Once obtained, that mandate is protected for three years, giving the employer a settled and predictable period for negotiating a collective agreement.

Conclusion

With the amendments to the TUA and IRA since 2024, employers must now be prepared for more than one union seeking to represent the same class of workmen.

The IRA nevertheless provides a clear framework. Recognition remains the gateway to representation, while sections 11, 12, 12A and 12B regulate competing claims and ensure that collective bargaining is channelled through a single union holding sole bargaining rights for a settled three-year term.

Disclaimer: This article is for general information only and does not constitute legal advice or legal opinion. It should not be relied upon as a substitute for specific legal advice. No person should act (or refrain from acting) based on this article without obtaining advice on the specific facts and circumstances. Halim Hong & Quek does not accept responsibility or liability for any loss or damage arising from reliance on this article. Halim Hong & Quek reserves the right to update, amend or withdraw this article at any time. All rights reserved.

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About the authors

Siva Kumar Kanagasabai
Senior Partner
Head of Dispute Resolution Practice Group
Halim Hong & Quek
kumar@hhq.com.my

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Omar Qayyum Bin Hamdan
Associate
Dispute Resolution
Halim Hong & Quek
omar@hhq.com.my