Kesatuan Pekerja-Pekerja Dalam Perkhidmatan Perubatan Dan

Kesihatan Swasta
[2020] MELRU 301 v. Assunta Hospital pg 1

KESATUAN PEKERJA-PEKERJA DALAM PERKHIDMATAN

PERUBATAN DAN KESIHATAN SWASTA
v.
ASSUNTA HOSPITAL

Industrial Court, Kuala Lumpur

Noor Ruwena Mohd Nurdin
Award No: 31 of 2020 [Case No: 12/2-477/15]
31 January 2020

Case(s) referred to:

Association of Bank Officers, Peninsular Malaysia v. Malaysian Commercial
Banks' Association [1981] 1 MELR 60; [1981] 1 ILR 136 (refd)
Genting Berhad v. Genting Berhad Employees Union [1982] 2 MELR 82; [1982] 2
ILR 228 (refd)
Goodyear Malaysia Berhad v. Kesatuan Kebangsaan Pekerja-Pekerja Syarikat-
Syarikat Pembuat Keluaran Getah [2006] 1 MELR 727; [2006] 2 ILR 1243 (refd)
Kesatuan Kebangsaan Pekerja-Pekerja Perusahaan Alat-Alat Pengangkutan Dan
Sekutu v. Oriental Summit Industries Sdn Bhd [2019] MELRU 1414; [2019] 3 ILR
175 (refd)
Lam Soon (M) Bhd v. Kesatuan Pekerja-Pekerja Perkilangan Perusahaan
Makanan [1998] 5 MLRH 145; [1999] 3 MLJ 347 (refd)
Malaysian Commercial Bank Association v. National Union of Bank Employees
[1982] 1 MELR 371; [1982] 1 ILR 246 (refd)
Malaysian Commercial Banks' Association v. Association of Bank Officers,
Peninsular Malaysia [1988] 1 MELR 196; [1988] 1 ILR 280 (refd)
Malaysian Commercial Banks' Association v. Association of Bank Officers,
Peninsular Malaysia [1993] 1 MELR 460; [1993] 2 ILR 151 (refd)
Malex Industries Bhd v. Non- metallic Mineral Products Manufacturing
Employees Union [1995] 1 MELR 415; [1995] 2 ILR 178 (refd)
Non-Metallic Mineral Products Manufacturing Employees' Union v. Malaya
Glass Factory Sdn Bhd [1984] 1 MELR 9; [1985] 1 MLJ 129; [1984] 1 CLJ (rep)
305 (refd)
Rothmans of Pall Mall (M) Bhd v. Rothmans Employees' Union [1990] 3 MELR
155; [1992] 2 ILR 196 (refd)
Sarawak Commercial Banks Association v. Sarawak Banks Employees' Union
[2002] 3 MELR 679; [2003] 1 ILR 445 (refd)

Legislation referred to:

Employment Act 1955, s 60F
Industrial Relations Act 1967, ss 2, 4(3), 14(3), 26(2), 30(4), (5), (6), Part IV

Counsel:
For the union: P Vickneswaren; M/s Vickneswaren & Associates
For the respondent: H Ramadass, (together with T Kavitha); M/s Ramadass &
Associates
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pg 2 v. Assunta Hospital [2020] MELRU 301

[Order accordingly.]

AWARD

Noor Ruwena Mohd Nurdin:

Background

[1] The reference made under subsection 26(2) of the Act was in relation to the
13th Collective Agreement ("the Collective Agreement") between the Union
and the Hospital after the parties' failure to conclude it. There had been 12
Collective Agreements previously between the Union and the Hospital. The
12th Collective Agreement was concluded on 21 May 2013 and given
cognizance by the Court vide Cognizance No 096/2013. By virtue of art 8.1 of
the 12th Collective Agreement, the effective period of that agreement was from
1 January 2012 and shall remain in force for a period of 3 years until 31
December 2014 and thereafter until superseded by a new Collective
Agreement or terminated as provided therein.

[2] The Union duly wrote to the Hospital vide letter dated 15 December 2014
for the purposes of commencing collective bargaining for the 13th Collective
Agreement. There were meetings held with the aim of concluding the
Collective Agreement. However, according to the Hospital there was only 1
meeting held for this purpose which was on 16 January 2015. They were
unable to agree on a number of Articles. Hence, both parties applied jointly for
the Ministerial reference to the Court for an award in respect of the 13th
Collective Agreement which was for the period of 1 January 2015 until 31
December 2017.

[3] The hearing commenced on 27 September 2017 and ended on 21 August

2019. The Union called 2 witnesses to testify on its behalf ie Mr Krishnan a/l
Marimuthu (UW1) the General Secretary of the Union and Mr Muhammad
Haryani Bin Abd Razak (UW2), an employee of the Hospital. The Hospital
called Ms Maggie Yeow Chor Key, the Head of Human Resources (COW1)
as its sole witness. At the commencement of the hearing, the Court was
informed that the parties had agreed on most of the Articles (including
Annexures referred to Appendixes). The signed Agreed Articles are contained
in 'Annexure A' and forms an integral part of this Award in respect of the 13th
Collective Agreement.

[4] The remaining 22 proposals that have not been concluded and needed to be
resolved by the Court are contained in the bundle of document marked as
"Disputed Articles" (DA). They are as follows:
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[5] It is the duty of the Court to scrutinise the evidence and submissions in
support of each party's case in coming out with the Award, ie whether the
Union's proposals can be accepted wholly or partly and at the same time to
consider the Hospital's position and whether it has the means to carry out its
obligations to the Union as determined in the Award, bearing in mind that the
Hospital is a non-profit charitable foundation, a Company Limited by
Guarantee with no shareholders.

[6] In doing so, the Court is guided by the principles in subsection 30(4) of the
1967 Act taking into account factors such as public interest, financial
implications, the impact on the country's economy as well as the industry
concerned and relevant industries in which the Award may possibly affect.
Hence, the provisions of subsections 30(5) and (6) are also trite in the Court's
exercise of examining the evidence adduced by the parties in a trade dispute in
order to arrive at a decision that would have taken into account the factors as
stated in subsection 30(4): Goodyear Malaysia Berhad v. Kesatuan Kebangsaan
Pekerja-Pekerja Syarikat-Syarikat Pembuat Keluaran Getah [2006] 1 MELR 727;
[2006] 2 ILR 1243; Lam Soon (M) Bhd v. Kesatuan Pekerja-Pekerja Perkilangan
Perusahaan Makanan [1998] 5 MLRH 145; [1999] 3 MLJ 347. It is a delicate
exercise and one which is not to be rushed, in order for the Court to hand
down a balanced Award that would cater to the needs of the concerned parties
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in the industry.

[7] Before proceeding to consider the evidence presented by the parties, it is to

be noted the following documents that have been marked accordingly:
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[2020] MELRU 301 v. Assunta Hospital pg 5

Evaluation Of Evidence And Findings

(i) Article 3 - Union Recognition And Scope Of Representation

Article 3.2

[8] This provision was in the 12th Collective Agreement and proposed to be
maintained by the Union in the new Collective Agreement. Article 3.2
provides:

"In light of maintaining good employer / employee relationship, the

Hospital agrees to assist to register all employees eligible for
membership as Union members.".

[9] The Hospital proposed to delete this provision because according to COW1
registration of Union members is not a term and condition of employment.
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pg 6 v. Assunta Hospital [2020] MELRU 301

There is no legal or contractual requirement that employers are obliged to

recruit members on behalf of the Union. Further, it was submitted that the
involvement of the Hospital in registering employees as members of the Union
could be viewed as acts committed by members of the Hospital in breach of
Part IV of the 1967 Act which prohibits interference by the management in the
employees' right to join a trade union and to participate in its lawful activities.
Additionally, the Hospital cited possible breach of subsection 4(3) of the 1967
Act whereby no employer shall support any trade union of workmen by
financial or other means with the object of placing the union under the control
or influence of such employer. The Hospital argued that by requiring it to
register the employees of the Union, it would result in the Hospital doing the
Union's job and responsibilities which might place the Hospital in a position
where it could be seen as interfering with the right of the employee to decide
whether or not to join a union.

[10] Moreover, since the Hospital also did not agree with the Union's proposal
on "Check Off" in art 46 of the proposed Collective Agreement, the Hospital
decided to remove this Article from the Collective Agreement. It submitted
that the issue did not come within the term "trade dispute". The Court notes
that s 2 of the 1967 Act defines a trade dispute to mean "any dispute between
an employer and his workmen which is connected with the employment or
non-employment or the terms of the employment or the conditions of work or
any such workmen.". Hence, the Hospital viewed that such Article should not
be included by the Court in the Collective Agreement. The Hospital submitted
further that as the proposal did not come within the terms and conditions of
employment, the Court has no jurisdiction to hold that the Hospital will agree
to register all employees for membership as Union members.

[11] On the other hand, the Union's witness (UW1) testified that it wished to
retain the provision, which had been there since the 10th Collective
Agreement. The provision was for the purpose of facilitating good relationship
between the Hospital and the Union. He said that any attempt to remove it by
the Hospital showed that it was not keen to maintain good relationship and
further to make it harder for registration of Union members. The Union
submitted that the fact that this provision had been in existence since the 10th
Collective Agreement amounted to an implied or existing term and any
attempt to remove it without any credible and reasonable reason showed that
there was ill-intention on the part of the Hospital against unionism at the
workplace. Further to delete this provision would not be in accordance with
the spirit and intendment after according recognition to the Union and
subsequently concluding Collective Agreements between the parties.
Therefore, the Union urged the Court to retain this provision.

[12] The Court has looked at the evidence adduced by both sides and
submissions made on the retention or deletion of art 3 February The Union's
argument was that the provision had been there since the 10th Collective
Agreement and that it facilitated good relationship between the Hospital and
the Union, why delete it now? The Hospital's argument for its deletion was
simply that it was not a term and condition of employment ie relating to
pay/salary and benefits. Is art 3.2 a term and condition of employment? The
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Court is of the view that it is not, as otherwise all employees must become
Union members in order for the letter of offer of employment for each person
to be valid. Having regard to the factors in subsection 30(4), art 3.2 may not
have a big impact on public interest, financial implications, the country's
economy as well as the industry concerned. However, the purpose of art 3.2 is
(after giving recognition to the Union) is to enable the Hospital to assist in the
registration of employees who are eligible to become Union members. Article
46 is on Deduction of Union Dues. These 2 articles are generally together as
they relate to each other.

[13] The Hospital cited the case of Non-Metallic Mineral Products

Manufacturing Employees' Union v. Malaya Glass Factory Sdn Bhd [1984] 1
MELR 9; [1985] 1 MLJ 129; [1984] 1 CLJ (rep) 305 where the Federal Court
held that consensual practice of employees and employers cannot expand the
jurisdiction of the tribunal. The respondent argued that "Check Off"
(deduction of union dues) was not a condition of service. The previous
agreement was a separate matter, and therefore, the Federal Court agreed that
the tribunal acted outside its jurisdiction when it decided on the article on
"Check Off".

[14] Despite its contention, the Court views that the Hospital has not shown
through evidence how, in assisting the employees' registration in the Union, it
would be taking on the Union's job and responsibilities "which might place the
Hospital in a position where it could be seen as interfering with the right of the
employee to decide whether or not to join a union". Looking at it with equity
and in good conscience, the Court views that the registration exercise can be
easily done when a new employee registers or reports for duty at the Hospital.
In assisting the registration of Union members, it was also not shown by the
Hospital the possible breach of subsection 4(3) of the 1967 Act. The Court
does not agree that by assisting in such registration showed that the Hospital
was supporting the Union by financial or other means with the object of
placing the Union under the control or influence of such employer. The
employee agrees to have his salary deducted for Union dues when he joins a
trade union in the Hospital. It is not the Hospital which provides the Union
dues for the employee from its own pocket. However, by retaining this Article,
the Hospital will have shown goodwill towards its own employees and their
welfare, in line with the objective to maintain industrial harmony and good
working relations between the employer and employees. For the avoidance of
doubt, art 46 on Check Off already states that "The authorisation letter
completed by the individual employee shall stipulate the monthly dues and
any changes in the dues shall be notified in advance on a fresh authorisation
letter.". There is no issue of the employee being under the control or influence
of the Hospital as he dictates and authorises the deduction from his salary for
the Union dues.

[15] The Honourable Members of the Panel are of the view that the Hospital
should continue to provide this service under art 3.2 and consequentially art 46
as well. Nevertheless, the Chairman is of the view that the Court is bound by
the Federal Court decision in the Non-Metallic Mineral Products Case as the
superior court had ruled in favour of the company in that case. In the present
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case however, on a majority of the Honourable Members of the Panel, art 3.2
is to be maintained as per the 12th Collective Agreement.

(ii) Article 8 - Duration, Modification And Termination Of Agreement

Article 8.1

[16] The Union proposed that the new art 8.1 maintain the duration of the
agreement to be 3 years following the 12th Collective Agreement as follows:

"This Agreement shall take effect from 1 January 2015 and shall
remain in force for a period until of three (3) years expiring on the 31
December 2017 and thereafter, until superseded by a new Agreement
or an award of the Court, or terminated as provided herein.".

[17] The Union proposed that the 13th Collective Agreement is to immediately
continue from the 12th Collective Agreement. Further, it proposed to
commence the 13th Collective Agreement from 1 January 2015 which was
also within 6 months backdating from the date of the referral by the Minister
on 18 June 2015.

[18] Meanwhile, the Hospital proposed that the duration of the Collective
Agreement be changed to four (4) years instead. COW1 stated that after 31
December 2014 (end of the 12th Collective Agreement period) although
parties commenced collective bargaining promptly, it took almost 3 years for
the matter to reach this stage. She said that the parties would have no
opportunity of benefitting from implementing the 13th Collective Agreement
since the proposed expiry date in the Union's proposal would be 31 December
2017. Hence, the Hospital was of the view that in order to feel the full effect of
the 13th Collective Agreement, there must be sufficient time for it to operate.
Otherwise, parties would have to commence collective bargaining on the 14th
Collective Agreement immediately after the Award on the 13th Collective
Agreement is handed down.

[19] The Hospital said it could not be blamed for the delay caused in the
conclusion of the new Collective Agreement because the Union did not
respond to the Hospital's counter proposals despite the Union acknowledging
receipt of the Hospital's written reminders dated 9 February 2015 and 4 March
2015. She said there were also no further discussions between the Union and
the Hospital. The Hospital was subsequently informed that the Union had
unilaterally referred the proposed 13th Collective Agreement dispute to the
Director General of Industrial Relations for settlement on the basis that there
was a deadlock in the negotiations between the parties. The Hospital further
contended that the extended duration of the Collective Agreement would not
cause any hardship to the employees covered by the Collective Agreement.

[20] UW1 stated that the Union strongly opposed such an attempt as it would
be most unreasonable for the Hospital to benefit at the expense of the members
of the Union who had done no wrong to have a Collective Agreement for 3
years, like in the past. Further, it will set a bad example in the industry to have
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a Collective Agreement for a period of 4 years, when the Union had acted in
accordance with the procedure set out by the law. He added that the collective
agreements with other hospitals were for only 3 years. Further, the Hospital
had also entered with another Union in the Hospital, namely Persatuan
Kakitangan Kanan Assunta Hospital (referred to as the "Senior Union") for 3
years only, commencing from 1 July 2016 to 30 June 2019. The Collective
Agreement with the Senior Union is exhibited at pp 3 to 26 of the Union's
Supplementary Bundle of Documents (UB1). The Union thus strongly
believed there was no valid reason for the Hospital's proposal to have the 13th
Collective Agreement for a duration of 4 years.

[21] The trade dispute was referred to the Court on 18 June 2015 and the 12th
Collective Agreement with Cognizance No 096/2013 became effective from 1
January 2012 for a period of 3 years. It was submitted by the Hospital that
there was nothing in the 1967 Act which stipulated the maximum period of a
Collective Agreement should only be for 3 years. It relied on the cases
Malaysian Commercial Banks' Association v. Association of Bank Officers,
Peninsular Malaysia [1988] 1 MELR 196; [1988] 1 ILR 280; and Genting
Berhad v. Genting Berhad Employees Union [1982] 2 MELR 82; [1982] 2 ILR
228. In those cases, it was decided that the award was effective for a period of
4 years' duration due to the short life span of the collective agreements (2
years). As such, the Hospital said that there was valid basis in its proposal in
respect of the proposed Collective Agreement.

[22] It is noted that in the Malaysian Commercial Banks' Association Case the
court ordered the Award to be effective from 1 January 1987 (the Association
proposed it to be 1 January 1988) and effective for 4 years. In respect of the 3
years Collective Agreement with the Senior Union, the Hospital stated that it
could not be the basis for the present proposal because there was no delay in
the conclusion of the agreement and that it was entered into in a timely
manner. The Hospital was able to implement the Senior Union Collective
Agreement during the term of its existence. It said that it was not bound to
enter into a 3 years' Collective Agreement with the Union just because that
was the duration of agreement entered into with other hospitals. The Hospital
submitted that the employees would not be losing out by agreeing to a 4 years'
Collective Agreement since the increase in the costs of living during the 4 years
would be taken into consideration when the parties enter into collective
bargaining for the 14th Collective Agreement, which would be commencing
soon after the Court hands down this Award.

[23] The Hospital submitted further that since no award could be handed
down by this Court before the termination date proposed by the Union it
would be fair that the duration be for a 4 years' period. It also contended that
since the court in the cases cited above had handed down an award for 4 years'
period it would be fair in the present case to have the same duration for the
13th Collective Agreement. On the other hand, the Union submitted that the
Hospital has failed to provide any cogent reasons to displace the existing
practice in the Hospital and the industry. The Union contended that any
changes to the entrenched practice would have an effect on related or similar
industries.
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[24] The Court agrees that there is nothing in the 1967 Act which limits the
maximum duration for a Collective Agreement but the Act provides for not
less than 3 years' duration. Bearing in mind that if the duration of the 13th
Collective Agreement is 3 years, the effective period of its implementation
would have ended on 31 December 2017. Nevertheless, the 12th Collective
Agreement had expired on 31 December 2014 and the matter was referred to
the Court by Ministerial Reference by the Union in June 2015.

[25] Now the employer wishes to extend the expiry date to 31 December 2018
which is an addition of one (1) year. It is permissible under the law to have
more than 3 years' period for any collective agreement. However, the 12th
Collective Agreement between the parties is still running and the subsequent
13th Collective Agreement is still pending. Taking this into consideration, and
that it can only be concluded / or negotiated upon conclusion of the 12th
Collective Agreement, the Honourable Members of the Panel opined it is best
that this Collective Agreement be kept to its original period, that is, starting
from 1 January 2015 to 31 December 2017. Therefore, as there were no special
circumstances to depart from previous practice apart from the delay in the
conclusion of the negotiations between the parties, the Court unanimously
decides that the operation of the 13th Collective Agreement be maintained for
a period of the 3 years' duration.

(iii) Article 8 - Duration, Modification And Termination Of Agreement

Article 8.4

[26] In line with its proposal to increase the duration of the Collective
Agreement to 4 years, the Hospital proposed that the date for serving of the
written notice to negotiate on new terms and conditions of employment shall
not be earlier than 1 October 2018. The new proposal by the Union is to
maintain the current art 8.4 with the addition of the words "in accordance with
the provisions of the Industrial Act 1967.". It reads:

"Either party may serve on the other three (3) months written notice to
negotiate on new terms and conditions of employment and other
related matters but no such notice shall be served earlier than 1
October 2017. The party that serves the notice shall also submit
proposals on terms and conditions of employment for negotiation. In
the event of a deadlock in negotiation, the provisions of the current
terms and conditions of employment shall prevail until superseded by
new terms concluded between the parties or awarded by the Industrial
Court, in accordance with the provisions of the Industrial Act 1967.".

[27] The Court has deliberated on the evidence in respect of art 8.4 as
highlighted above. Therefore, since this art 8.4 is consequential to art 8.1, the
Court also unanimously decides that the written notice to negotiate on new
terms and conditions of employment and other related matters shall not be
served earlier than 1 October 2017. The rest of the wordings in paragraph in
art 8 April are to be maintained as per the 12th Collective Agreement.
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(iv) Article 8 - Duration, Modification And Termination Of Agreement

Article 8.5

[28] This Article is in respect of notice to terminate the Collective Agreement.

In line with its proposal to increase the duration of the Collective Agreement
to 4 years, the Hospital also proposed that the agreement may be terminated
no earlier than a notice served on 1 October 2018. The Union proposed the
following:

"This Agreement may be terminated by either party giving three

months written notice but such notice shall not be served earlier than 1
October 2017.".

[29] As this art 8.5 is also consequential to art 8.1, the Court unanimously
decides that the written notice to negotiate on new terms and conditions of
employment and other related matters shall not be served earlier than 1
October 2017. The art 8.5 is to read as follows:

"This Agreement may be terminated by either party giving three (3)

months' written notice but such notice shall not be served earlier than
1 October 2017.".

(v) Article 14.1 - Salary Adjustment And Arrears Of Pay

[30] In UWI's witness statement, he used the word "should" in place of the
word "shall" in respect of the art 14.1 on Salary Adjustment and Arrears of
Pay. The proposal on this Article by the Union now reads as follows:?

"All employees shall be given a pay rise of 8% on their last drawn

basic salary as at 31 December 2014 rounded off nearest Ringgit with
effect 1 January 2015".

[31] The Union's justification for its proposal of 8% of pay rise was based on
the following factors:

(a) the financial capacity of the Hospital to pay, which could be seen
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from the profits generated by the Hospital for the years 2013 and 2014,
namely RM10,142,960.00 and RM15,286,001.00 respectively (refer to
p 66 of UB);

(b) the current labour policy of the country, which aspires to be a high
income nation;

(c) Pantai Medical Centre Sdn Bhd had also given 8% for the
Collective Agreement commencing from 1 June 2014 (refer to p 115 of
UB);

(d) that based on public interest, better living conditions of employees

could only be possible by giving them current living wage, which
tended to increase the national wealth and income; and

(e) that the Union's proposal was also based on grounds of social
justice that a fair share of the profits generated by the Hospital, be
given back to the employees, which they helped to earn.

[32] The Hospital proposed that only employees who were in the service of the
Hospital as at the signing date shall be given a pay rise of 4.6% on their last
drawn basic salary as at 31 December 2014 rounded off to the nearest Ringgit
with effect from 1 January 2015. COW1 said that it is an established principle
of industrial law in the country that salary adjustment to be made upon signing
new Collective Agreements should not exceed more than 2/3 of the increase
in the Consumer Price Index (CPI) between the period of commencement of
the last salary adjustment and the next salary adjustment. Since the last salary
adjustment was granted in January 2012 and the increase in the Consumer
Price Index (CPI) between 2012 to 2014 had been only 6.9% (2012-1.6%,
2013-2.1%, and 2014-3.2%), therefore 2/3 of the increase would be 4.6%. She
said that there was also no basis for the Union to ask for an increase of 8%
(refer to p 21 of COB2).

[33] COW1 gave examples of other collective agreements entered into between
the Union and other hospitals which showed that the Union had agreed to the
following:

(a) Kinta Medical Centre (1/3/2014 - 28 February 2017) signed on 3

November 2014 art 38.1, the salary revision is from 5% to 5.5%, and
art 38.3 stated that the provision shall not apply to employees who
ceased to be employed by the Hospital prior to the signing date (refer
to pp 22 - 25 of COB2).

(b) Pantai Penang Hospital 4th CA (1/1/2016 - 31 December 2018)

signed on 26 April 2017 art 14.1, the salary revision is from 5.5% to
6%, and art 14.4 stated that the salary revision will not apply to
employee who ceased to be employed by the Hospital prior to the
signing date (refer to pp 26 - 29 of COB2).

(c) Pantai Medical Centre 11th CA (1/6/2014 - 31 May 2017) signed

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on 1 June 2014 art 56.1, the salary revision is from 6% to 8%, and art
56.3 stated that the salary revision will not apply to employees who
have ceased to be employed by the Hospital and employees who are
not members of the union prior to the signing date (refer to p 115 of
UB and pp 30- 31 of COB2).

(d) Gleneagles Penang CA (1/8/2015 - 31 July 2018) signed on 26

August 2015 Cognizance. No 182/2015 Article 18.1, the salary
revision remained status quo at 6.5%, and art 18.4 stated that the salary
revision in sub-section 18.1 of this Article will not apply to employees
who ceased to be employed by the Hospital prior to the signing date of
the Agreement (refer to pp 32 - 35 of COB2)

[34] COW1 stated that since the Hospital had been consistently granting salary
adjustments to the employees during the duration of the 12th Collective
Agreement and there had been no sudden increase in the Consumer Price
Index (CPI), the Hospital was satisfied that an increase of 4.6% which
amounted to 2/3 of the increase in CPI between years 2012 to 2014 would be
sufficient. However, in tandem with the Hospital's proposal for 4 years'
duration for the effective period of the Collective Agreement, the increase in
the CPI between 2012 to 2015 (2012-1.6%, 2013-2.1%, 2014-3.2% and 2015-
2.1%) had been only 9%, 2/3 of the increase would be 6%. In this
circumstances, she said there was no valid basis for the Union to propose that
the Hospital's salary adjustment to be increased to 8%.

[35] Paragraph 7.3 of the Statement in Reply stated that a significant

proportion of the surplus derived by the Hospital is not paid out as dividends
to shareholders or directors, instead all of the surplus is retained to provide
quality and affordable healthcare to the community in general in keeping with
the philosophy of the Foundation and charity cases in particular. The Hospital
also pleaded in its pleading and through the evidence of COW1 that it
operated as a not-for-profit organisation and on the premise of social
entrepreneurshi p 30% of the surplus in its business is reinvested back into the
projects to be undertaken by it, including charitable and community activities.
The Hospital also has to provide for further expansion/refurbishment of the
hospital, investment of new technology and medical equipment, and other
operational costs. These take up the balance of the 70% of its surplus derived
from the Hospitals operations. Hence, its objection to the 8% increase
proposed by the Union.

[36] In response to the Hospital's proposal, the Union opposed it as it did not
reflect the actual situation in the Hospital. UW1 alleged that in view of the
profits generated by the Hospital, it clearly indicated that the Hospital was
financially capable to pay 8% as proposed by the Union. The Hospital also did
not plead financial incapacity. Furthermore, the Hospital had given 6.5% to
the Senior Union in the Hospital. According to him the Senior Union
comprised of employees who earn higher salaries than the employees under
the scope of the Collective Agreement. As such, the Hospital's attempt to give
4.6% and that too, for a period of 4 years, was not justified at all. The Union
also questioned COW1 about the stand of the Hospital, being a non-profitable
 Kesatuan Pekerja-Pekerja Dalam Perkhidmatan Perubatan Dan
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pg 14 v. Assunta Hospital [2020] MELRU 301

organisation and prided itself by giving charity to the poor must necessarily
also show similar sentiments to its employees who helped to contribute to the
success and profits generated. It said that charity should begin at home.
COW1 replied that she did not know.

[37] The Hospital submitted on the established principle of one-off salary

adjustment to be granted at the commencement of a new Collective
Agreement where it should not be more than 2/3 of the increase in the CPI
over the previous 3 years. The 2/3 principle or famously known as "Harun J's
principle" made the ruling in the case of Malaysian Commercial Bank
Association v. National Union of Bank Employees [1982] 1 MELR 371; [1982] 1
ILR 246 as follows:

"We are of the view that salary increases based on the CPI should be
an exercise of looking back to see whether salaries determined three
years ago have been in any way affected by the CPI of today. The
general practice is not to match the full extent of the increase in the
CPI. In some countries the amount of increase allowed is 60%. In this
country, we think, the general rule, should be that salary increases
based purely on the increase in the CPI should not be less than 60% or
more than 2/3 of the average increase of the CPI over the previous
three-year period.".

[38] On the other hand, the Union submitted that the Harun J's principle was
merely a guide for the courts to consider and it went on to give a few examples
of what the Industrial Court had awarded in past cases. It is noted that out of
the 6 cases submitted by the Union, in 2 cases the court had awarded a slightly
higher percentage of salary increase than the CPI percentage for the relevant
periods. That was in the case of Rothmans of Pall Mall (M) Bhd v. Rothmans
Employees' Union [1990] 3 MELR 155; [1992] 2 ILR 196 (salary increase was
7% and the CPI was 6.97%) and Goodyear Malaysia Berhad v. Kesatuan
Kebangsaan Pekerja-Pekerja Syarikat- Syarikat Pembuat Keluaran Getah [2006] 1
MELR 727; [2006] 2 ILR 1243 (salary increase was 7% and the CPI was
5.49%). It was argued that the abovesaid principle was laid down 37 years ago
when the CPI increase for 3 years the was 21.5%. The Union raised the issue
of whether that guideline could be the only factor to be considered by the
Court after 37 years, moreover when the CPI figure is low. UW1 in his
evidence also stated that there were some hospitals that paid out costs of living
allowance (COLA) such as Pantai Hospital Kuala Lumpur (also known as
Pantai Medical Centre) which provides RM80 for COLA to all its employees
whom were covered by its 11th Collective Agreement and 8% increase in the
new Collective Agreement. However, Assunta Hospital does not provide for
COLA to its employees and is only proposing 4.6% increase. UW1 was
questioned that Pantai Hospital Kuala Lumpur made a profit of RM55 million
in 2014 (which he said he did not know) and hence could make such payments
to its employees. UW1 stated that if the Hospital gave better benefits overall to
its employees in the Collective Agreement, then the Union would accept a
maximum of 8% increase as the basis for the adjustment. He said further that
the Union had proved that without productivity, the Hospital would not have
made profits in its operations as shown in the evidence.
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[2020] MELRU 301 v. Assunta Hospital pg 15

[39] The Union submitted further that in Sarawak Commercial Banks

Association v. Sarawak Banks Employees' Union [2002] 3 MELR 679; [2003] 1
ILR 445 the High Court in relation to the issue of formula for the computation
on the rates of pay, stated that it was the legislature's intention to leave it to the
Industrial Court to find the basis for such computation as can be seen in the
provisions of subsections 30(4) and 30(5) of the 1967 Act.

[40] The Court noted that in Kesatuan Kebangsaan Pekerja-Pekerja Perusahaan

Alat-Alat Pengangkutan Dan Sekutu v. Oriental Summit Industries Sdn Bhd
[2019] MELRU 1414; [2019] 3 ILR 175, the learned Chairman stated the
position of the law as follows:

"[21] It is trite law that the Court in deciding on the question of wage
structure and wage increases, has to take into account the following
factors:

[a] Wages and salaries prevailing in comparable

establishments in the same region;

[b] Any rise in the cost of living since the existing wages or
salaries were last revised; and

[c] The financial capacity of the company to pay the higher

wages/increase.

[22] Of all the three factors stated above, the company's financial
capacity to pay is really the limiting factor in dealing with wage
increases and any with other employees' benefits, because when other
factors may provide prima facie justification, increased wages will
normally be awarded only within the limits of the company's financial
capacity.

[see Penfibre Sdn Bhd Penang v. Penang & S. Prai Textile & Garment
Industries Employees' Union [1986] 1 MELR 86; [1986] 1 ILR 323
(Award No: 46 of 1986) at p 5].".

[41] The Court has considered the evidence adduced and submissions by the
parties on this issue. One interesting point to note from the Union's
submission, and which may distinguish this case from other cases on collective
agreements that have been disputed in the past, is that the Hospital did not
plead financial incapacity to pay the increase sought by the Union or that by
giving the increase of 8% sought then it would not make a reasonable profit.
The Court noted further that the crux of the Hospital's basis for proposing
4.6% which amounted to an increase of 2/3 in the CPI between years 2012 to
2014 is that the amount would be sufficient, and because it is a not-for-profit
organisation. In Malaysian Commercial Banks' Association v. Association of
Bank Officers, Peninsular Malaysia [1993] 1 MELR 460; [1993] 2 ILR 151, the
Industrial Court held that:
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pg 16 v. Assunta Hospital [2020] MELRU 301

"Once the rates had been fixed in accordance with the established
wage fixation policy, all that is required to be done for future wage
revision is to examine and determine, in the absence of any extraneous
factors and special circumstances, whether there is an increase in CPI
since the last wage fixation. If there is an increase then logically there
should be an upward revision, subject always to the employer's
financial ability to pay.

15 In the instant case before us, the Association had not, for one
moment, pleaded any financial inability to pay. But then it urged us
not to grant any upward revision, as the increase in CPI was
negligible. If is not fair to deny the officers any increase in pay when
there is an increase in the cost of living, even though the increase may
be small....If we take into account the guide lines laid down in
MCBA/NUBE (Award No 117/82, the Union's claim seems to be
excessive....".

[42] The Court views that a 8% increase as proposed by the Union is not
appropriate considering the principles enunciated in the above case and also
taking into account the provision of subsections 30(4), (5) and (6) of the 1967
Act. Considering the principle in the case above, the private hospital which is
nearest to the Hospital in terms of comparison of region and capacity is
apparently Pantai Hospital Kuala Lumpur as mentioned by UW1 and COW1
in their testimonies. In the Hospitals' example on Pantai Hospital Kuala
Lumpur, the adjustment was between 6% - 8%. The Court opines that
similarly, for the present case a 6% increase ie 2/3 of 9% CPI for the years
2012-2015, is a reasonable and fair adjustment. In the circumstances of the
present case, having regard to the financial implications and the effect of this
Award on the economy of the country and private hospital industry, the Court
is of the considered view that the Union's claim of 8% increase is excessive.
Hence, the Court awards a 6% salary adjustment across the board in respect of
the disputed art 14.1 of the Collective Agreement. It is noted that the
employees will receive annual increment every year which will in turn
compensate the increase in the inflation rate. The Hospital has proposed that
employees who are in the service of the Hospital as at the signing date will
receive the adjustments. However, in this case "the signing date of the
Collective Agreement" is the date of this Award by the Court. Therefore, art
14.1 shall read as follows:

"All employees shall be given a pay rise of 6% on their last drawn

basic salary as at 31 December 2014 rounded to the nearest Ringgit
with effect from 1 January 2015.
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[2020] MELRU 301 v. Assunta Hospital pg 17

Article 15.1

[43] In the proposed art 15.1, the Union's proposal reads:

"The maximum number of hours that an employee is required to work

shall not exceed forty-two (42) hours per week. However, shift
workers may be required by the Hospital to work more than forty-two
(42) hours in any one week, provided the average number of hours
worked over any period of three (3) weeks shall not exceed forty-two
(42) per week inclusive of break time.".

[44] In respect of the new art 15.1, the Union is seeking to reduce the
maximum number of hours that an employee is required to work from 45
hours to 42 hours because although in the past it was agreed that the
maximum hours was 45 hours, but for all purposes the employees had always
worked for 42 hours. And this practice had been in the Hospital since UW1
first started working with Assunta Hospital in 1983 until he retired in 2013. He
stated that by having the maximum 45 hours of work, it had led to hardships
to some employees because they were at times suddenly asked to work more
than 42 hours on the ground that the agreement stated 45 hours of maximum
hours. He said the Hospital had changed the working hours to an extra 30
minutes a day for 6 days and that the employees were not paid for the extra 30
minutes worked. This had led to many employees finding difficulty to arrange
their day-to-day life.

[45] COW1 stated that the Union did not provide any justification as to why it
wanted to reduce the number of working hours by the employees concerned.
The Hospital did not agree to the Union's proposal because since the
Employment Act 1955 allowed the employees to work up to 48 hours per
week and the Hospital in the past agreed that employees would not be required
to work for more than 45 hours per week which she said was already a better
term for the employees, there was no basis for the Union to propose the
maximum working hours to be 42 hours per week. A perusal of other
collective agreements entered into between the Union and other hospitals
showed that the Union agreed to 45 hours per week, the details as below:

(a) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 12.1, 45 hours work
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pg 18 v. Assunta Hospital [2020] MELRU 301

week inclusive of break time (refer to pp 36 - 37 of COB2).

(b) Pantai Medical Centre 11th CA (1/6/2014 - 31 May 2017) signed

on 1 June 2014 art 15.2, 45 hours work week inclusive of break time
(refer to p 115 of UB).

(c) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 art 20.1, 45 hours work week inclusive of break
time (refer to p 115 of UB).

(d) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 art 10.2, 48 hours work week inclusive of
break time (refer to pp 38 - 39 of COB2).

[46] Upon perusal of the evidence the Court is unanimous in its decision on art
15.1 that the original provision as per the wordings in the 12th Collective
Agreement is to be maintained. This is because there is a similar provision in
art 18.1 of the Senior Union's Collective Agreement. Further, there was no
evidence other than UWI's oral assertion regarding the employees' hardships
in this respect. Pursuant to this decision, the Hospital will be able to draw up a
suitable break time(s) for the employees as per the examples given in the
preceding paragraph. Article 15.1 is to read as follows:

"The maximum number of hours that an employee is required to work

shall not exceed forty-five (45) hours per week. However, shift workers
may be required by the Hospital to work more than forty-five (45)
hours in any one week, provided that the average number of hours
worked over any period of three (3) weeks shall not exceed forty-five
(45) hours per week, inclusive of break time.".

(vii) Article 15 - Working Hours

Article 15.4

[47] The Union's proposal on art 15.4 is as follows:

"The working hours of shift employees shall be 7am-2pm, 2pm-9pm

and 9pm-7am (inclusive of Break). Any changes to these working
hours shall only be done with the consent of the Union.".

[48] In relation to art 15.4, the Union sought to include the words "inclusive of
Break" in the designated working hours because there was no designated break
permitted for employees working in shift to have their meals. Further, this
proposal will also reflect the long standing practice in the Hospital. The Union
also sought to add "Any changes to these working hours shall only be done
with the consent of the Union". The basis of this addition is that currently the
Hospital is changing the working hours on its own accord and this has led to
problems to the employees. UW1 stated that similar provisions are also found
in other hospitals' collective agreements (refer to p 116 of the UB).
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[2020] MELRU 301 v. Assunta Hospital pg 19

[49] The Hospital proposed to delete the existing provision in the Collective
Agreement which stated the working hours shall be 7am to 2pm, 2pm to 9pm
and 9pm to 7am. COW1 stated that art 15.4 provided leeway for the Hospital
to operate and manage its business in all respects pertaining to the
administration and ethics of the medical profession, and in particular to
determine the number and deployment of the work force and that the Hospital
shall not breach any of its obligations under the terms of this Agreement. In
this regard, the Hospital proposed to delete this provision because by not
specifying the shift hours, the Hospital would have the flexibility to set the
working hours according to the operational needs and still keep to the 45 hours
work week as stipulated in art 15 January It stated that where there was a need
to change the existing work hours for the employees on shift duty, the Hospital
would have prior consultation with the Union.

[50] The Union again strongly opposed this attempt, as it would lead to
uncertain working hours and result in abuses on the part of the Hospital in
respect of the working hours for the shift and non-shift employees. The
employees too needed certainty in respect of their working hours, so that they
could arrange their lives with their families. UW1 alleged that many hardships
could follow, if their working hours were left at the complete whims of the
Hospital.

[51] Again, looking at the evidence the Court is unanimous in its decision on
art 15.4 that the original provision as per the 12th Collective Agreement is to
be maintained. The Hospital proposed to delete this provision but it had not
come up with an alternative solution. As rightly pointed out by the
Honourable Members of the Panel, if the working hours are not stated, it may
create chaos and disharmony at the work place. A fixed working hour will be
the basis for the calculations of any payment and allowance such as shift
allowance and overtime payments. Further, there is no necessity to insert in art
15.4 the words ''...(Inclusive of Break). Any changes to these working hours
shall only be done with the consent of the Union". This is due to the fact that
art 15.1 has already been decided as above and art 15.2, which is not disputed,
already provides for consent of the employee in case of any changes.

(viii) Article 15 - Working Hours

Article 15.5

[52] The Union's proposal on art 15.5 is as follows:

"The working hours of non-shift employees shall be 8.30am-5.30pm.

Lunch 1.00pm-2.00pm. Saturday 8.30am-1.00pm (Tea break 15 min -
Lunch 1 hour).".

Note: The Union then proposed to delete the words "Lunch 1 hour".

[53] In relation to the proposal on art 15.5 by the Union, it sought to include a
tea break of 15 minutes for non-shift employees. The basis of seeking this
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pg 20 v. Assunta Hospital [2020] MELRU 301

revision is merely for clarity purposes, that is, to reflect the long standing
practice of employees to have a tea break. The Union has proposed that the
working hours of non-shift employees shall be 8.30am to 5.30pm, lunch break
from 1.00pm to 2.00pm and on Saturdays the working hours shall be 8.30am
to 1.00pm inclusive of tea break of 15 minutes. The Hospital proposed to
delete this provision for the same reason it gave in respect of its proposal to
delete art 15 April COW1 stated that a perusal of other Collective Agreements
entered into between the Union and other hospitals showed that none of them
specified the 15 minutes' tea break, the details were as follows:

(a) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 12.4, the working
hours of non-shift employees shall be 8.30am - 5pm with a lunch break
1 hour (refer to pp 36 - 37 of COB2).

(b) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 art 10.1, the working hours of all
employee excepting those following office hours shall be 8am -
4.30pm, 8.30am - 5pm (refer to pp 38 - 39 of COB-2).

(c) Pantai Medical Centre 11th CA (1/6/2014 - 31 May 2017) signed

on 1 June 2014 art 15, the working hours of non-shift employee shall
be 9am - 5pm (refer to p 116 of UB).

(d) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 art 20.4, the working hours of non-shift employees
shall be 8.30am - 5pm with lunch break one (1) hour, Saturday 8.30am
- 1pm (refer to p 116 of UB).

[54] Based on the evidence the Court is unanimous in its decision on art 15.5
that the original provision as per the 12th Collective Agreement is to be
maintained. The Hospital proposed to delete this provision but it had not come
up with an alternative solution. Again, the Court is of the view that if the
working hours is not stated, it may create chaos and disharmony at the work
place. More so in terms of the basis for the calculations of any payment and
allowance such as shift allowance and overtime payments. It is not necessary
to include the "(Tea break 15 min)" in art 15.5 because Article 15.1 has already
provided for it as decided above.

[55]Subsection 14(3) of the 1967 Act provides that any term or condition in a
collective agreement that is less favourable than or in contravention of the
provisions of any written law applicable to workmen covered by the said
collective agreement shall be void and of no effect to that extent and the
provisions of such written law shall be substituted therefor. Perhaps the parties
could take the cue (and negotiate for an amicable solution) from the ruling in
the case of Malex Industries Bhd v. Non- metallic Mineral Products
Manufacturing Employees Union [1995] 1 MELR 415; [1995] 2 ILR 178
(Award No: 292 of 1995) on hours of work, whereby it was stated by the
learned Chairman that:
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[2020] MELRU 301 v. Assunta Hospital pg 21

"The union submitted that s 60A(1)(a) read together with s 60A(9)

means that any break for leisure of less than 30 minutes is to be
considered part of the 'hours of work'. It is the intention of the
legislature that employees must not be made to work for more than
five hours without a break for leisure of at least 30 minutes. In the
court's opining, s 60A(1)(a) is not about whether the 'hours of work'
should or should not include meal or tea breaks. The subsection is an
injunction to employers to provide a break for leisure of at least 30
minutes after employees work five consecutive hours.It is for the
parties to negotiate and agree between themselves whether or not meal
and tea breaks are to be considered part of the 'hours of works'.".

[Emphasis added]

(ix) Article 15 - Working Hours

Article 15.6

[56] In relation to the proposal on art 15.6, the Union sought to insert a new
provision in the following manner:

"Night shift employees who are required to work four nights will be
entitled to three days off including weekly rest day.".

[57] The basis of this new addition is that because when an employee works
during the night shift, he or she works from 9.00pm to 7.00am, which means
the employee will have worked for 10 hours. According to the Union, if an
employee worked for 4 nights in a week, the employee would have already
clocked in 40 hours per week and hence, the employee could not possibly
work for another day immediately as it would infringe the agreed maximum
hours of work. Further, it is also to reflect a long standing practice in the
Hospital and other Hospitals.

[58] The Hospital disagreed to this new proposal as it contradicted art 15.1
regarding the 45 hours' work week. It said that if the Union's proposal is
accepted, it would mean that night shift employees will work only 40 hours
per week as against other shift workers who have to work longer hours per
week. Furthermore, none of the collective agreements recently concluded by
the Union with other hospitals have this provision, the details as below:

(a) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 (refer to pp 36 - 37 of
COB2).

(b) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 (refer to pp 115 - 116 of UB).

(c) Fatimah Hospital 8th CA (1/4/2016 - 31 March 2019) signed on

18 November 2016 (refer to pp 40 - 41 of COB2).
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pg 22 v. Assunta Hospital [2020] MELRU 301

[59] From the evidence available, the Court agrees with the Hospital's
submission and is unanimous in its decision that the proposed art 15.6 remains
status quo. If their proposal is allowed, there is no equity between night shift
and day shift workers where the former category will have worked only 40
hours in a week, unlike the day shift workers. The Honourable Members of the
Panel viewed that any arrangement for lesser working days in a week is up to
the Hospital to decide.

(x) Article 15 - Working Hours

Article 15.7

[60] In relation to art 15.7, the Union sought to insert a new provision as
follows:

"All employees who are working Nonshift staff shall be entitled (2)
Saturday off as determine by Hospital.".

[61] The basis of this new addition is that the Union felt since the Hospital had
implemented two (2) Saturdays off for the management staff since 2010, it was
only right that the same be extended to non-shift employees under the scope of
the Collective Agreement. Further, the Union has proposed in art 15.5 above
to work longer working hours for non-shift employees, namely from 8.30am to
5.30pm, instead of the current provision in art 15.5, which require them to
work from 8.30am to 5.00pm. The Union believed that by allowing this
proposal, it will enable the non-shift employees to spend quality time with
their families and further lead a balanced lifestyle as promoted by the
government.

[62] The Hospital did not agree to the Union's proposal on art 15.7 because it
said that patient load on Saturdays were normally high and full manpower
needed to manage its operations. This was not challenged by the Union and
the Court accepts the Hospital's evidence. The Union also did not provide any
basis for suggesting this change to the terms and conditions. Furthermore,
none of the recently concluded collective agreements by the Union with other
Hospitals have a provision as proposed by the Union, the details as below:

(a) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 (refer to p 115 - 116 of UB).

(b) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 (refer to pp 38 - 39 of COB2).

(c) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 (refer to pp 36 - 37 of
COB2).

(d) Pantai Medical Centre 11th CA (1/6/2014 - 31 May 2017) signed

on 1 June 2014 (refer to p 115 - 116 of UB).
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[2020] MELRU 301 v. Assunta Hospital pg 23

[63] From the witness' evidence, it appears that the only reason for asking to
change this term and condition of service is to ensure the employees enjoy the
same benefit as the senior employees. No other evidence was offered by the
Union apart from UWI's testimony. It is noted that he had retired from the
Hospital several years ago in 2013. Hence, in the absence of sufficient proof
about the work-life balance issue in regard to non-shift employees that was
brought up by the Union, the Court agrees with the Hospital's submission and
is unanimous in its decision to reject the proposed art 15 July Again, any
arrangement for lesser working days in a week is up to the Hospital to decide
as long as it does not disrupt existing work processes in the Hospital.

(xi) Article 16 - Overtime

Article 16.3

[64] The revision sought here is to reflect the proposed maximum number of
hours of 42 in art 15.1 above in the formula to calculate the ordinary rate per
hour. The Union proposed that the formula should now read to reflect the
same as follows:

[65] In respect of art 16.3, the Union has proposed that the Ordinary Rate of
Pay (ORP) shall be calculated based on monthly rate of pay multiplied by 12,
divided by 42 multiplied by 52. The Hospital is proposing the ORP to be based
on monthly salary multiplied by 12, divided by 45 multiplied by 52, ie the
overtime rate agreed to under the 12th Collective Agreement as below:

[66] The Hospital contended that the Union did not justify why it wanted to
change the formula now to compute the ORP. The Hospital's reasoning was
based on the maximum hours worked per week. Further, the Hospital had
proposed that when an employee's basic salary exceeds RM2,000 per month
overtime performed at the request of the Hospital shall be calculated based on
RM2,000. This is because the Hospital does not impose surcharge on every
services rendered to patients after normal working hours (ie room and board,
medicine, consumables, etc.) in keeping with the Hospital's philosophy and
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pg 24 v. Assunta Hospital [2020] MELRU 301

pricing model.

[67] COW1 stated that it would also be relevant to note that the Union has
agreed in recently concluded collective agreements of other hospitals to have a
cap on the maximum salary for overtime payments:

(a) Pantai Medical Centre 11th CA (1/6/2014 - 31 May 2017) signed

on 1 June 2014 art 16.3, has imposed overtime capped at RM3,000
compared to the 10th CA signed on 1 June 2011 which has no
overtime rate of pay capping (refer to p 116 of UB and pp 42 - 43 of
COB2).

(b) Sentosa Medical Centre 12th CA (1/1/2015 31 December 2017)

signed on 10 February 2016 art 23.2, has imposed overtime capped at
RM2,000 (refer to pp 44 - 47 of COB2).

(c) Fatimah Hospital 8th CA (1/4/2016 - 31 March 2019) signed on

18 November 2016 art 9.4, has imposed overtime capped at RM2,000
(refer to pp 48 - 51 of COB2).

(d) Kedah Medical Centre 2nd CA signed on 27 April 2016 art 34.7,
has imposed overtime capped at RM2,000 (refer to pp 52 - 54 of
COB2).

(e) Paloh Medical Centre 1st CA (1/1/2015 - 31 December 2017)

signed on 20 November 2015 art 16.4, has imposed overtime capped
at RM2,000 (refer to pp 55 - 56 of COB2).

[68] The Hospital proposed to cap the salary for overtime payment
calculations to RM2,000. This is not an unusual proposal but it has never been
the practice in the Hospital to cap overtime pay. In art 19 of the Senior Union's
Collective Agreement it reads "Employees drawing a basic salary not
exceeding RM2,000 per month shall be paid overtime for any work done at the
request of the Hospital at the rates prescribed by the Employment Act 1955 for
each hour in excess of the normal working hours". The Hospital has not
shown why there is to be a different treatment in this regard for the non-senior
union employees. Therefore, the Court is unanimous in its decision on art 16.3
that the original provision is to be maintained as per the 12th Collective
Agreement.

(xii) Article 20 - Sick Leave

Article 20.1

[69] The Union proposed that this Article is maintained status quo as per the
12th Collective Agreement. However, the proposal by the Hospital is to revise
the existing provision in art 20.1 as follows:

"All employees falling within the scope of the Agreement shall be

entitled to paid sick leave and hospitalisation in accordance with the
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[2020] MELRU 301 v. Assunta Hospital pg 25

provision of s 60F of the Employment Act 1955. However, all sick

certificates for hospitalisation from a Government Medical Officer or
private general practitioner must be endorsed by a designated doctor
practising at the Hospital of up to two (2) days per event and a
maximum of four (4) days outpatient treatment per calendar year after
which sick certificates from other private practitioners will not be
accepted".

[70] It was contended by the Union that the Hospital's proposal to revise art
20.1 would unnecessarily cause great hardship to the employees to seek
medical treatment, as the condition set out in the Hospital's proposal would
cause practical problems for the sick employees by reducing the number of
times of sick certificates can be obtained from a Government Medical Officer
or private general practitioner from 14 days to 4 days only for outpatient
treatment per calendar year. Further, this kind of condition as proposed by the
Hospital is not found in any other hospitals' collective agreements (refer to pp
120-121 of UB). The Union felt that the existing provision adequately catered
for this situation and as such, the Union has proposed that the status quo to be
retained.

[71] COW1 stated that the rationale for the Hospital's proposal was that the
Hospital was equipped with amenities and qualified doctors to treat patients
and staff alike. As such, the staff should take pride of the Hospital's amenities
and seek medical treatment at Assunta Hospital and refrain from obtaining
medical treatment and sick leave from other external sources unless in cases of
emergency. It said that the quantum of 14 days per calendar year is "over the
top" and 4 days is adequate to allow staff to seek medical treatment at non-
panel clinics.

[72] The Court has considered the evidence available before it on this issue.
Whilst there is a valid point raised by the Hospital in respect of employees
seeking treatment at its own premise rather than outside, nevertheless, the
Hospital's proposal may be impractical (in terms of logistics or location of the
employee's home from the Hospital) and it even qualified it by saying "unless
in cases of emergency". Under s 60F of the Employment Act 1955, employees
are allowed to utilise up to a total of 60 days of paid sick leave inclusive of
hospitalisation and 14 days of private clinic/hospital medical leave for
outpatient treatment. The Hospital's proposal is to limit the number of days of
sick leave to 4 days for outpatient treatment, which may very well be the most
type of treatment sought by sick employees. Not all treatment would result in
hospitalisation for the patient and therefore, the Hospital's proposal appears to
be somewhat unbalanced. In the absence of any evidence by the Hospital to
show that its employees had abused this facility, the Court is unanimous in its
decision that art 20.1 is to be maintained as per the 12th Collective Agreement
in accordance with the law.

(xiii) Article 22 - Medical Benefits

Article 22.5
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[73] The Union proposed to maintain status quo the original art 22.5 on
Medical Benefits which reads as follows:

"An employee who falls ill at places which are more than seventy-five
(75) kilometres away from the Hospital shall be entitled to medical
attention from a duly registered medical practitioner at the expense of
Assunta Hospital on production of original itemized receipts from the
employee."

[74] The Hospital proposed to insert the words and within Malaysia" before
shall be entitled to...". The Hospital explained the rationale to include the
words "within Malaysia" as it was appropriate to specify within Malaysia since
this benefit did not extend to claims outside Malaysia. COW1 stated that in
her opinion, 75km meant that the place was within Malaysia. However, the
Court is of the view that she could be wrong because "75km away from the
Hospital" may also cover an international location beyond the Straits of
Malacca.

[75] The Union strongly felt that the introduction of the words "within
Malaysia" was very unfair, as the employees, who went overseas during their
leave would be deprived of the medical benefits. The fact that the employee
was still in service, he or she should be entitled to medical benefits regardless
of his or her whereabouts at the time of illness. Furthermore, it said that the
existing provision has been there for a long time without any abuse. As such,
the Union felt that the provision of art 22.5 is to be retained

[76] Again, the Court is of the view that the Hospital has not produced
sufficient evidence in terms of the figures or amount of monies claimed by its
employees for treatment sought whilst on leave abroad. This is to enable the
Court to assess the actual situation and how much does it cost for the Hospital
to reimburse such claims Therefore, the Court is unanimous in its decision on
art 22.5 that the original provision as per the 12th Collective Agreement is to
be maintained.

(xiv) Article 29 - On-Call Allowance

Article 29.2(c)

[77] The Union's proposal for a new art 29.2(c) is as follows:

"Provided that the rate of payment for on-call duty on Public

Holidays/Rest day (is) two times the above rates.".

[78] The new addition sought by the Union was because the provisions were
commonly found in other hospitals' collective agreement such as Pantai
Medical Centre Sdn Bhd, Hospital Pusrawi Sdn Bhd and Sentosa Medical
Centre Sdn Bhd (refer to p 129 of the UB). This is to ensure clarity on rate of
payment for on-call duty on Public Holidays / Rest Day, namely two times
more than the rates agreed in arts 29.2 (a) and (b). It is noted that there was no
similar provision in the Senior Union's Collective Agreement.
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[2020] MELRU 301 v. Assunta Hospital pg 27

[79] The Hospital objected to the Union's proposal of doubling the hourly rate
of on-call allowances for Public Holiday/Rest Day as unjustified because the
Hospital does not impose surcharge on every services rendered on a Public
Holiday/Rest Day, and (ie room and board, medicine, consumables, etc.) in
keeping with its philosophy and pricing model.

[80] On this matter, the Union proposed for double the hourly rates of on-call
allowances for Public Holiday/Rest Day. However, the Court views that it has
not advanced sufficient justification that may be properly considered by the
Court to decide in its favour on this issue. The rate of payment for on-call
allowance on Public Holiday and Rest Day should follow the Public Holiday
and Rest Day agreed rates. Therefore, the Court is unanimous in its decision
to reject the inclusion of art 29.2(c) in the Collective Agreement.

(xv) Article 31 - Other Allowance

Article 31.2

[81] The Union's proposal for this Article is as follows:

"All employees who are required to work in shifts shall be paid the
following allowance:

(a) Morning Shift RM5.00 per day

(b) Afternoon Shift RM10.00 per day".

[82] In relation to the proposal for art 31.2(a), the Union sought to add a
quantum of RM5.00 per day for morning shift employees who were required
to work on shift. The basis of seeking this allowance was that even employees
who were required to start work as early as 7.00am would need some
additional incentives for the inconvenience caused, such as they were unable
to send children to school and had to incur transport charges to do the same.
As for the revision sought by the Union in art 31.2 (b) from RM6.00 per day to
RM10.00 per day for employees working on afternoon shift, the Union
believed that a revision of RM4.00 was necessary in view of the fact that they
would only return home after 9.00pm and hence being restricted from family
obligations and other inconvenience caused.

[83] The Hospital does not agree to this proposal because insofar as morning
shift is concerned, there is no necessity to pay any allowance since employees
working in the morning shift do not experience any form of inconvenience.
COW1 said it is also not the practice in the Hospital sector to provide for
payment of Morning Shift Allowance. Further, adding on the Morning Shift
Allowance of RM5 would have a cost impact of RM311,208 per annum on the
Hospital.

[84] COW1 further stated that none of the recently concluded Collective
Agreements of other hospitals provided for Morning Shift Allowance, the
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pg 28 v. Assunta Hospital [2020] MELRU 301

details as below:

(a) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 (refer to pp 57 - 58 of COB2).

(b) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 (refer to pp 59 - 60 of COB2).

(c) Pantai Klang Specialist Hospital 6th CA (1/1/2015 - 31 December

2017) signed on 1 February 2016 (refer to pp 61 - 62 of COB -2).

(d) Pantai Medical Centre 11th CA (1/6/2014 - 31 May 2017) signed

on 1 June 2014 (refer to pp 63 - 64 of COB-2).

[85] COW1 further stated that in regard to the increase in the Afternoon Shift
Allowance proposed by the Union, the Union had not shown in what manner
the inconvenience had increased to justify an increase in the allowance.
Further, increasing the Afternoon Shift Allowance from RM6 to RM10 would
have a cost impact of 66.67% equating to RM209,904 per annum on the
Hospital which was considered very high since the Hospital was managed on a
not-for-profit making basis. In this circumstance, the Hospital did not agree to
any changes in the shift allowance.

[86] Additionally, Afternoon Shift Allowances of other hospitals where the

Union has recently entered into collective agreements with are lower than the
Afternoon Shift Allowances paid by Assunta Hospital. The details are as
follows:

(a) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 art 47, Afternoon Shift Allowance remain
the same rate at RM4 per day (refer to pp 59 - 60 and 65 - 66 of
COB2).

(b) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 art 42.1, is RM4 per day (refer to pp 57 - 58 and 67
- 68 of COB2).

(c) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 26, increase from RM4
to RM5 per day (refer to pp 61 - 62 and 69-70 of COB2).

[87] After considering the evidence available before the Court and the parties'
submissions on this issue, the Court opines that there is no sufficient
justification for the Union's proposal to insert a new Morning Shift Allowance
and increase the Afternoon Shift Allowance. The Union claimed that
employees working in the morning shift experience inconvenience. But non-
shift employees, for example, who have school-going children may also
experience the same problems The Morning Shift Allowance is an incentive
for that category of employees to come in to work in the morning. For the
Hospital, the Morning Shift hours are between 7.00am to 2.00pm whereas for
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[2020] MELRU 301 v. Assunta Hospital pg 29

non-shift employees the working hours are from 8.30am to 5.00pm on

weekdays. It is the Court's considered view that there is not much difference in
the Morning Shift hours when compared to the normal working hours of non-
shift employees. Therefore, the Court is unanimous in its decision to reject the
inclusion of the Union's proposal for art 31.2 (a) in the Collective Agreement.
Whereas the rate for the Afternoon Shift Allowance is maintained status quo.

(xvi) Article 37 - Uniform

Article 37.1

[88] The Union proposed that art 37.1 to read as follows:

"All employees who are required by the Hospital to wear uniforms

shall be issued with three (3) sets of uniforms initially and thereafter
two (2) set uniform annually. They will also be provided with two
pairs of suitable footwear annually. The Hospital will determine the
footwear suitable for the different categories of uniformed staff.".

[89] The revision by the Union in art 37.1 is that all employees are to be given
two sets of uniform annually for the purpose of ensuring the employees are
given sufficient sets of uniform and further to ensure they appear tidily at
work. This is also to reflect past long standing practice in the Hospital. UW2
gave evidence that the uniforms supplied to the employees were insufficient.
Due to his job scope, sometimes he had to receive a patient who was bleeding
and his uniform will be stained. He would have to wear the stained uniform
until he went home. If he could not get the stained uniform to be washed the
next day, he would have to wear his old uniform. He complained that
sometimes it also takes a long time for them to get a replacement uniform, for
example, due to wear and tear.

[90] The Hospital did not agree to the Union's proposal because under the
present Agreement uniforms are supplied to staff on wear and tear basis or
earlier if the uniforms are worn off ahead of the 12 months. As such, there was
no necessity for any changes to be made. The Hospital proposed for status quo
on this provision. Below is an example of the recently concluded collective
agreement of Fatimah Hospital on Uniform:

Fatimah Hospital 8th CA (1/4/2016 - 31 March 2019) signed on 18

November 2016. Article 20.1, employees who are required by the
Hospital to wear uniforms shall be issued with:

i. Two (2) sets of uniforms renewal according to normal wear

and tear

ii. One (1) new uniform every year (refer to pp 71- 72 of COB-
2).

[91] From the evidence, the Court is of the view that the Hospital's proposal
on art 37.1 is fair and reasonable. Hence, the Court unanimously decides that
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pg 30 v. Assunta Hospital [2020] MELRU 301

the provision of this Article as per the 12th Collective Agreement is

maintained. Nevertheless, taking the cue from UW2's complaint about the
length of time taken to get a replacement uniform, the Hospital should
improve on this process so as to ensure that the employees at all times have the
required uniform when they are at work.

(xvi) Article 37 - Uniform

Article 37.3

[92] The proposal by the Union in respect of this Article reads:

"The Hospital shall either provide laundry service in respect of

employees' uniforms or pay them a laundry allowance of RM50.00 per
month."

[93] The revision sought by the Union in respect of art 37.3 was in relation to
the laundry allowance from RM25.00 per month to RM50.00 per month. It
believed that this revision was necessary because the last revision on this
quantum was made through an Award of the Industrial Court in Award No
540 of 1994.

[94] The Hospital objected to this proposal to increase the Laundry Allowance
from RM25 to RM50 because it said that would have a cost impact of 100%
equating to RM144,420 per annum on the Hospital which is considered very
high. It is the Hospital's contention that the Union has not adduced any
justifiable reason in support of the increase sought.

[95] In the circumstance, the Hospital did not agree to the changes in the
Laundry Allowance. Additionally, Laundry Allowance of other hospitals
where the Union has recently entered into collective agreements with were
generally on par with the Laundry Allowance paid by the Hospital, details as
below:

(a) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 art 24, the Laundry Allowance of RM16
was withdrawn altogether (refer to pp 73 - 76 of COB2).

(b) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 31.3, the Laundry
Allowance remained status quo at RM25 per month (refer to pp 77 - 80
of COB2).

(c) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 art 18.3, increase the Laundry Allowance from
RM25 to RM30 per month. (Please refer to p 133 of UB and pp 81 - 82
of COB2).

[96] Nevertheless, from the evidence, the Court is of the view that the Union's
proposal on art 37.3 is fair and reasonable taking into account the fact that the
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[2020] MELRU 301 v. Assunta Hospital pg 31

last revision was done in 1994, which was more than 25 years ago. Further,
the Court has awarded art 37 January to the Hospital and the numbers of
uniform supplied to the employees are maintained as per the 12th Collective
Agreement. Therefore, it is only equitable that the Hospital increases the
Laundry Allowance so that employees can have clean uniforms to wear
whenever they are on duty. Hence, the Court unanimously awards the Union
its proposal for the Hospital to either provide laundry service or a Laundry
Allowance of RM50, which is an increase of RM25 from the present
allowance. If the Hospital is not willing to fork out RM50 per month for
Laundry Allowance, then it should provide a laundry service to its employees.

(xviii) Article 40 - Hospital Service Allowance

[97] The Union's proposal for art 40 is to read as per the following:

"The Hospital shall pay Hospital Service Allowance as follows:

(a) Staff Nurse/Pharmacy Assistant/Medical Assistant

RM350.00 per month

(b) Community Nurse/SEAN midwife RM250.00 per month

(c) Other employees RM230.00 per month".

[98] The basis of seeking revision on the rates of Hospital Service Allowance
(HSA) in categories (a) to (c) in the proposal was because the Union felt that
such a revision would be an incentive to retain staff in the Hospital, which it
said was experiencing a high turnover rate. The Union stated that the HSA
was originally introduced by the Hospital for the purposes of retaining staff.

[99] The Hospital stated that the Union's request to increase RM100 of HSA
for Staff Nurse was too steep and would give rise to a cost impact of 40%
equating to RM279,336 per annum. The Hospital proposed HSA for Staff
Nurse to be status quo because if based on its past Collective Agreements (ie
the 10th CA and 11th CA), there was no change at RM240, whilst in the 11th
CA and 12th CA, the increase was RM10. Therefore, for the 13th Collective
Agreement, the rate should remain at RM250 as per the 12th CA following the
same trend as previous collective agreements (ie the 10th CA - 11th CA), the
details as below:

[100] As it is now, by comparison with the collective agreements of other

hospitals, Assunta Hospital's HSA for Staff Nurse is the highest among the
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Klang Valley hospitals. The details are as below:

(a) Pantai Medical Centre 11th CA (1/6/2014 - 31 May 2017) signed

on 1 June 2014 art 57.1, the HSA for Staff Nurse remained status quo
at RM150 (refer to pp 93 - 101 of COB2).

(b) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015 art 40.1, the HSA for Staff Nurse remained status
quo at RM200 per month (refer to pp 102 - 108 of COB2).

(c) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 art 48, the HSA for Staff Nurse increase
was RM10 from RM190 to RM200 per month (refer to pp 109 - 115 of
COB2).

(d) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 38, the HSA for Staff
Nurse increase was RM35 from RM85 to RM120 per month (refer to
pp 116 - 121 of COB2).

[101] COW1 stated that for the category of Medical Assistant/Pharmacy

Assistant, the Union's request to increase RM220 for HSA was too steep and
would give rise to a cost impact of 169.23% equating to RM44,748 per annum.
The Hospital proposed that HSA for Medical Assistant/Pharmacy Assistant to
be status quo because if based on the Hospital's past Collective Agreements (ie
the 10th CA and 11th CA), there was no change at RM120, whilst the 11th
CA to 12th CA, the increase was RM10. Therefore, for the 13th Collective
Agreement (CA), the rate should remain at RM130 as per the 12th CA
following the same trend as previous collective agreements (ie 10th CA and
11th CA). The details are as below:

[102] As it is now, by comparison with other hospitals, the Hospital's HSA for
Medical Assistant/Pharmacy Assistant is the highest compared to recently
concluded collective agreements of other hospitals as cited below:

(a) Sentosa Medical Centre 12th CA (1/1/2015 - 31 December 2017)

signed on 10 February 2016 the HSA for Medical Assistant/
Pharmacy Assistant is not applicable as these positions are not within
the scope of Collective Agreement (refer to pp 109 - 115 of COB2).

(b) Pantai Penang Hospital 4th CA (1/1/2016 - 31 December 2018)

signed on 26 April 2017 art 46, the HSA for Pharmacy Assistant
increase was RM10 from RM80 to RM90 per month (refer to pp 122 -
130 of COB2).
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(c) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 38, the HSA for
Pharmacy Assistant increase was RM35 from RM85 to RM120 whilst
HSA for Medical Assistant is not applicable as this position is not
within the scope of Collective Agreement (refer to pp 116 - 121 of
COB2).

[103] The Hospital stated that the Union's proposal to upgrade Medical
Assistant/ Pharmacy Assistant from a lower tier (Other Employee) to the
same tier as Staff Nurse (SN) was not justified because Staff Nurse cover full
works of patient care that require physical and mental preparation and
readiness, whilst Medical Assistant and Pharmacy Assistant work coverage is
much leaner, less physical and mental strain.

[104] For the category of Community Nurse/SEAN/Midwife, the Union's

request to increase RM100 of HSA was also too steep and would give rise to a
cost impact of 66.67% equating to RM36,612 per annum. The Hospital
proposed that HSA for Community Nurse/SEAN/Midwife to be status quo
because if based on Assunta Hospital's past Collective Agreements (ie the 10th
CA and 11th CA), there was no change at RM140, whilst the 11th CA to 12th
CA, the increase was RM10. Therefore, for the 13th Collective Agreement
(CA), the rate should remain at RM150 as per the 12th CA following the same
trend as previous collective agreements ie the 10th CA and 11th CA), The
details are as below:

[105] As it is now, by comparison, the Hospital's HSA for Community

Nurse/SEAN/ Midwife is higher or on par with recently concluded collective
agreements of Klang Valley hospitals as cited below:

(a) Pantai Medical Centre 11th CA (1/6/2014 31 May 2017) signed

on 1 June 2014 art 57.1, the HSA for Community Nurse/Midwife
remained status quo at RM150 per month (refer to pp 93 - 101 of
COB2).

(b) Sentosa Medical Centre 12th CA (1/1/2015 31 December 2017)

signed on 10 February 2016 art 48, the HSA for Midwife increase was
RM10 from RM140 to RM150 per month (refer to pp 109 115 of
COB2).

(c) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 38, the HSA for
Community Nurse increase was RM35 from RM60 to RM95 per
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pg 34 v. Assunta Hospital [2020] MELRU 301

month (refer to pp 116 - 121 of COB2).

[106] In regard to the category of Other Employee, the Hospital stated that the
Union's request to increase RM100 of HSA was also too steep and would give
rise to a cost impact of 76.92% equating to RM295,608 per annum. The
Hospital proposed that the HSA for "Other Employees" to be maintained
status quo because if based on Assunta Hospital's past Collective Agreements
(ie the 10th CA and 11th CA), there was no change at RM120, whilst the 11th
CA to 12th CA, the increase was RM10. Therefore, for the 13th Collective
Agreement, the rate should remain at RM130 as per the 12th CA following the
same trend as previous collective agreements (ie the 10th CA and 11th CA).
The details are as below:

[107] The Hospital contended that as it is now, by comparison, Assunta

Hospital's HSA for Other Employee is higher compared to the collective
agreements of other hospitals cited below:

(a) Kinta Medical Centre CA (1/3/2014 - 28 February 2017) signed on

3 November 2014 art 36, the HSA for Other Employee remained
status quo at RM80 per month (refer to pp 131 - 136 of COB2).

(b) Pantai Penang Hospital 4th CA (1/1/2016 - 31 December 2018)

signed on 26 April 2017 art 46, the HSA for Other Employee group
increase was RM10 from RM80 to RM90 per month (refer to pp 122 -
130 of COB2).

(c) Fatimah Hospital 8th CA (1/4/2016 - 31 March 2019) signed on

18 November 2016 art 41, the HSA for Other Employee increase was
RM15 from RM75 to RM90 per month (refer to pp 137 - 146 of
COB2).

(d) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 38, the HSA for Other
Employee increase was RM35 from RM85 to RM120 per month (refer
to pp 116 - 121 of COB2).

[108] It is the Hospital's contention that the Union has not adduced any
justifiable reason in support of the increase sought. On the other hand, the
Union proposed the increase in the HSA for certain categories as an incentive
to retain staff in the Hospital. Although the Hospital admitted there was a
turnover rate of about 10 employees per month, COW1 said that that was
normal in the industry.
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[109] The Court has considered the evidence available and is of the view that
an increase in salary adjustment as discussed earlier in this Award in art 14.1
would result in increasing the salary base of all employees under the scope of
the Union. Thus it will "compensate" the other allowances proposed by the
Union, including the HSA. Therefore, the Court unanimously decides that the
HSA rates are maintained as per the 12th Collective Agreement.

(xix) Article 45 - Implementation

Article 45.1

[110] The Union has proposed the following:

"Article 45 - Implementation

45.1 The monetary benefits under this Agreement shall be

retrospective from 1 January 2015.

45.2 The Agreement shall only be applicable to employees who are in

the service of the Hospital on the effective date of the Agreement
(01.01.2015).".

[111] In relation to the proposal for art 45.1, the Union sought to ensure all
monetary benefits for this 13th Collective Agreement shall be retrospective
from 1 January 2015, which is basically in tandem with the date of
commencement of the 13th Collective Agreement. In respect of the proposal
for art 45.2, the Union sought to ensure that the 13th Collective Agreement
shall only be applicable to employees who were in the service of the Hospital
on 1 January 2015. The Union further stated its proposals in arts 45.1 and 45.2
are merely to reflect the normal practice in respect of the implementation of
the Collective Agreement.

[112] The Hospital's proposal to art 45.1 were that the monetary benefits under
this Agreement shall be implemented to employees who were still in the
Hospital's service on the signing date, and the Collective Agreement
adjustment as per art 14.1 and fixed allowance should be retrospective from
the effective date but overtime and all other allowances shall be effective on
the signing date of the Collective Agreement.

[113] The Union strongly opposed such proposal by the Hospital because it
said that that would deprive the employees from being entitled to all monetary
benefits from 1 January 2015, being the implementation date of the 13th
Collective Agreement. UW1 stated that the Union's proposal in respect of this
provision was a normal practice in the Hospital. The existing provision also
has the same wordings (except for the date of implementation) as the Union's
proposal here (refer to p 23 of the UB).

[114] In regard to art 45.1, the Hospital proposed that the Collective
Agreement adjustment and fixed allowances to be retrospective from the
effective date whilst overtime and all other allowances to be effective on the
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signing date of the agreement. This new insertion is adopted by other hospitals
of recently concluded collective agreements:

(a) Pantai Klang Specialist Medical Centre 6th CA (1/1/2015 - 31

December 2017) signed on 1 February 2016 art 35.1, retrospective
benefits under the Agreement shall be in respect of salary adjustment
and fixed allowances only and the Agreement shall be deemed to
operate from the effective date. In addition, art 35.2, stated that the
Agreement shall only be applicable to permanent employees who are
or have been in the service of the Hospital on the effective of this
Agreement (refer to pp 147 - 148 of COB2).

(b) Pantai Medical Centre 11th CA (1/6/2014 31 May 2017) signed

on 1 June 2014 art 44.1, the retrospective benefits shall be based on
basic wages, hospital allowances, special unit allowance, post basic
allowance and cost of living allowance effective 1 June 2014 (effective
date), excluding the overtime and annual leave benefits. In addition,
art 56.3 stated that salary revision in art 56.1 will not apply to
employees who have ceased to be employed by the Hospital and
employees not members of the union prior to the signing date (refer to
pp 134 - 115 of UB).

(c) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015, art 7.1, retrospective calculations of benefits shall
include all matters excluding overtime claim shall be deemed to
operate from 1 January 2013 (effective date) while art 7.3 stated that
the Agreement shall be only applicable to employees who are in the
service of the Hospital on the effective date of this Agreement. In
addition, art 7.4 stated that the benefit of this Agreement shall not be
applicable for the employee who has ceased employment at the time of
payment (refer to pages 134135 of UB).

[115] In this circumstances, the Hospital contended that to be consistent with

recently concluded collective agreements of other hospitals entered into by the
Union, there is basis for the implementation of monetary benefits to be as
proposed by the Hospital.

Article 45.2

[116] In respect of art 45.2, The Hospital proposed that the Agreement shall
only be applicable to employees who were still in the service of the Hospital on
the signing date of this Agreement. This new insertion is adopted by other
hospitals of recently concluded collective agreements, whereby the details are
as follows:

(a) Pantai Hospital Medical Centre 11th CA (1/6/2014 - 31 May

2017) signed on 1 June 2014 art 56.3, salary revision in art 56.1 will
not apply to employees who have ceased to be employed by the
Hospital and employees who were not members of the union prior to
the signing date of this Agreement (refer to p 115 of UB).
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(b) Pusrawi Hospital 2nd CA (1/1/2013 - 31 December 2015) signed

on 20 March 2015, art 7.4, the benefit of the Agreement shall not be
applicable for the employee who has ceased employment at the time of
payment (refer to pp 134 - 135 of UB).

(c) Fatimah Hospital 8th CA (1/4/2016 - 31 March 2019) signed on

18 November 2016 art 31.3, the Agreement shall only be applicable to
employees who are in the service of the hospital on the date of signing
of this Agreement (Please refer to pp 149 - 150 of COB2).

(d) Paloh Medical Centre 1st CA (1/1/2015 - 31 December 2017)

signed on 20 November 2015. In art 49.3, the Agreement shall only be
applicable to employees who are active in service on the signing date
of the agreement. (Please refer to pp 151 - 152 of COB2).

(e) Perak Community Specialist Hospital 13th CA (1/1/2014 - 31

December 2016) signed on 9 October 2014 art 36(b), the Agreement
shall only be applicable to employees who are in the service on the
effective signed date of this Agreement (refer to pp 153 - 154 of
COB2).

[117] In this circumstances, the Hospital stated that to be consistent with

recently concluded collective agreements of other hospitals entered into by the
Union, there is basis for the implementation of monetary benefits to be as
proposed by the Hospital.

[118] Again, the Union strongly opposed such proposal because by limiting it
to employees who were still in the service of the Hospital on the signing date
of the Collective Agreement and not the date of implementation of 1 January
2015, it would deprive employees who had been in service from 1 January
2015 but had left the service before the 13th Collective Agreement is
concluded. Hence, it would be plainly unfair to these kind of employees, who
had also served and benefited the Hospital.

[119] After evaluating the evidence adduced by the parties, the Court
unanimously decides that in respect of art 45.1 all monetary benefits are to be
retrospective to 1 January 2015 as the duration of the 13th Collective
Agreement has already lapsed on 31 December 2017. It would be unfair to the
employees whom had served the Hospital during that time not to be able to
claim their dues under the Collective Agreement. In regard to art 45.2, the
provision as per the 12th Collective Agreement is to be maintained and the
effective date is 1 January 2015. The Court finds that there was no special
circumstance for the Hospital to depart from its own previous practice.

(xxi) Article 46 - Deduction Of Union Dues

[120] The Union opposed any attempt by the Hospital to withdraw this
provision on the basis that it has been in in existence for a long time and
hence, it is an existing term. Further, the Hospital had even agreed to retain
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the provision of Check Off with the Senior Union (refer to p 22 of UB1).
Therefore, the Union contended that for the Hospital to withdraw now
without any valid reasons, simply goes to show that it was done with bad
intention.

[121] COW1 stated that as explained earlier, the Hospital viewed that this
provision could not be a subject matter of a trade dispute since it was not a
term and condition of employment between the Hospital and the employees.
In this circumstances the Hospital did not want to be burdened to collect union
dues from the employees and submit the same to the Union.

[122] The Court has considered the arguments for and against the deletion of
this Article by the parties, which are generally similar to the proposal to delete
art 3.2 by the Hospital. The parties could have resolved this article amicably
considering that Check Off is not a term and condition of service. The
Chairman is of the view that the Court is bound by the decision of the Federal
Court in the Non-Metallic Mineral Products Case . However, both the
Honourable Members of the Panel have decided that the art 3.2 is to be
maintained. Consequentially, art 46 is also to be maintained in light of the
majority decision on art 3 February

(xxii) APPENDIX B - Salary Structure

[123] In relation to the proposals for seeking revisions for the minimum and
maximum salaries in Appendix B, the Union stated that it was based on
market rates as given by other Hospitals (refer to pp 13 - 140 of UB, where the
rates of Pantai Medical Centre Sdn Bhd, Hospital Pusprawi Sdn Bhd and
Sentosa Medical Centre Sdn Bhd are found). The Union submitted that by
having the salary structure proposed by the Union, it would ensure that all
employees would enjoy adjustments and increments without being stagnated
by the current maximum salary structure. Further, this mechanism is a normal
practice in the Hospital industry to decide on the salary structure. By having
the salary structure as proposed by the Union, it will not only help to retain
staff but also to recruit new employees in the Hospital. In respect of the
proposal for increments as found at the bottom of the attachment of the
Disputed Articles, the Union believed that the rates proposed were based on
similar rates given by Pantai Medical Centre Sdn Bhd (refer to pp 140 - 141 of
the UB) and would also reflect the added skills given by the employees in the
current market force. The Union's proposal for Appendix B is as follows:
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[124] The Union submitted that this attempt by the Hospital to retain the
Salary Structure as per the 12th Collective Agreement would lead to the
possibility of certain employees being unable to enjoy the full monetary
benefits to be awarded by the Court. Further, this proposal of maintaining the
Salary Structure of the 12th Collective Agreement is not the normal practice in
the hospital industry and it will also be a discouraging factor for employees to
continue to serve the Hospital in the long run.

[125] In response, the Hospital stated that the Union's proposal on the salary
structure was not uniform and the increase too exorbitant (refer to pp 155 - 158
of COB2).

For example:

(a) Minimum salary increase ranged between 3.6% and 33.3%

(b) Maximum salary increase ranged between 8% and 36.9%

(refer to pp 159 - 160 of COB2).

[126] The Hospital proposed the Salary Structure to be status quo as per 12th
Collective Agreement because it complied with the Minimum Wages Order
2012 of RM900 per month. However, the Court noted that since 2012, there
had been increases in respect of the minimum wage in Malaysia. The Court
takes judicial notice that the minimum wage rate for the year 2016 as per the
Minimum Wage Order 2016 effective 1 July 2016 was RM1,000 for
Semenanjung Malaysia, corresponding to the effective period of the 13th
Collective Agreement which was not concluded then (as approved by the
Government). Previously the rate was RM900 in 2015.

[127] In comparison with the collective agreements of other hospitals, the

Union's proposal on the minimum and maximum salary was higher than
recently concluded collective agreements of other Hospitals, the details as
follows:

1) Minimum salary:
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[2020] MELRU 301 v. Assunta Hospital pg 41

2) Maximum salary:

[128] Based on the chart above and by comparing 12th Collective Agreement
against the Union's proposal, it showed that:

(a) the Union's proposal for the salary structure increase was not
consistent and did not take into consideration of the job scope of the
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designation in proposing the salary increase.

(b) the Hospital could not ascertain the formula in Union's proposal
on the increase in maximum salary.

[129] For example, for the designations of Pantry Aide and Hospital Aide. The
job scope for Hospital Aide was wider compared with Pantry Aide. However,
the Union had proposed higher increase in the minimum salary range for
Pantry Aide.

[130] The Hospital admitted that it recorded profit/surplus of RM15,286,001

for the year ending 31 December 2014 which included RM4,697,608 of non-
operating profit comprising interest revenue of RM2,653,376 and
compensation received of RM2,044,232. Thus, the actual Hospital operating
profit for 2014 was RM10,588,393.

[131] COW1 also stated that however, comparing the audited reports disclosed
to Suruhan Syarikat Malaysia (SSM), the hospitals below recorded profits as
follows:

(a) Pantai Medical Centre net profit for the year 2014 was
RM55,035,785 but 8% salary adjustment was concluded in their 11th
Collective Agreement (refer to pp 161 - 162 of COB2).

(b) Gleneagles Penang net profit for the year 2014 was RM25,154,185
but 6.5% salary adjustment was concluded in their Collective
Agreement (1/8/2015 - 31 July 2018) (refer to pp 163 - 164 of COB2).

(c) Pantai Hospital Penang net profit for the year 2014 was
RM13,382,585 but 6% salary adjustment was concluded in their 4th
Collective Agreement (refer to pp 165 - 166 of COB2).
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(d) Pantai Klang Specialist Medical Centre net profit for the year 2014
was RM12,133,213 but 6% salary adjustment was concluded in their
6th Collective Agreement (refer to pp 167 - 168 of COB2).

(e) Sentosa Medical Centre net profit for the year 2014 was
RM6,162,676 but 5.5% salary adjustment was concluded in their 12th
Collective Agreement (refer to pp 169 - 170 of COB2).

(f) Hospital Pusrawi net profit for the year 2014 was RM5,960,969 but
5% salary adjustment was concluded in their 2nd Collective
Agreement (refer to pp 171 - 172 of COB2).

(g) Subang Jaya Medical Centre net profit for year 2014 was
RM35,578,319 (non-union) (refer to pp 173 - 174 of COB1).

(h) Sunway Medical Centre net profit for year 2014 was
RM14,033,823 (non-union) (refer to pp 175 - 176 of COB2).

[132] Even though Assunta Hospital's audited profit for 2014 included interest
income and one-time adjustment, other hospitals also recorded profits. COW1
stated that the Union's demand for 8% salary adjustment (art 14.1) was not
comparable with collective agreement adjustments of other hospitals noted
above. According to COW1, the Hospital's proposal of 4.6% is reasonable for
reasons as noted below:

(a) with twelve (12) Collective Agreements concluded spanning thirty-

nine (39) years, the wages and benefits that the Hospital paid and
extended to its employees were adequate and fair as compared with
recently concluded collective agreements of other hospitals.

(b) to remain relevant and in furtherance of the Hospital's principal

function of providing essential service of medical care to the
community and also in fulfilling with the vision and mission of
providing free and complete medical care for the poorest of the poor,
the Hospital has to retain its profits to cover the escalation in
operational costs, future refurbishment and investments in new
technology and medical equipment.

(c) revenue generated from core services in medical care alone was
barely sufficient to meet the operating expenses of the Hospital.
Income from non-operating source, ie interest income and donations
have also been used to fund a host of charitable and community events
and to sustain the rising cost of operations and monetary obligations
of two (2) Collective Agreements (Kesatuan Pekerja-Pekerja Dalam
Perkhidmatan Perubatan dan Kesihatan Swasta and Persatuan
Kakitangan Kanan Assunta Hospital). However, in recent years as
noted in COB p 84, monetary donations have diminished considerably
and donations received only on occasions.
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(d) in keeping with the Hospital's philosophy of providing quality and

affordable healthcare to the community, the Hospital's pricing model
has to be lower than other private hospitals. Thus, salary adjustment
exceeding 4.6% will increase charges to patients.

(e) Assunta Hospital is a charitable foundation, a Company Limited

by Guarantee with no shareholders. The Hospital's Board of Directors
were all volunteers who served the Hospital on voluntary basis with
no remuneration and dividend payable to them at all.

(f) unlike the private hospitals noted above, Assunta Hospital is a "not-
for- profit" entity and operated solely on its own without any support
and backing from established local/overseas holding companies, such
as:

- Pantai Holdings Sdn Bhd (comprising 10 Pantai Hospitals

and 4 Gleneagles Hospitals nationwide).

- KPJ Healthcare Berhad (comprising Sentosa Hospital plus

24 other KPJ hospitals nationwide).

- Majlis Agama Islam Wilayah Persekutuan (comprising

Pusrawi Hospital and one dialysis centre).

- Ramsay Sime Darby Healthcare (comprising Subang Jaya

Medical Centre plus 2 others in the Klang Valley).

[133] Therefore, in order to remain a viable, relevant and sustainable entity,

the Hospital is compelled to be prudent and economical in its spending in view
of the current economic climate in the Country. In this regard, the Hospital is
required to exercise circumspection in making decisions on its capital
expenditure and operating expenses, which would include the monetary
obligations as provided for in Collective Agreement. However, one point
which struck the Court was that COW1 when asked about salary adjustment
and salary structure as per the Hospital's proposal which was to maintain the
rates as per the 12th Collective Agreement, she replied that she disagreed the
employees would be demoralised and hinder them from working harder. She
was also asked that by keeping to the old salary structure, it could stagnate the
employees' salary especially those whom have reached the maximum or
ceiling rate. The witness also disagreed to this question. The Court believes
that this is incorrect as it is only human nature to expect better terms and
conditions of employment whenever a new collective agreement is concluded.

[134] The Court has considered the evidence and submissions by the parties on
the issue of Salary Structure. It is of the view that based on the Hospital's
profit/surplus of RM15,286,001 for the year ending 31 December 2014 and
the actual Hospital operating profit was RM10,588,393, the Salary Structure is
to be increased for the 13th Collective Agreement but not at the figures
proposed by the Union. The Hospital is merely being prudent, which is to be
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[2020] MELRU 301 v. Assunta Hospital pg 45

expected, as it also carries out charitable activities. The Court hereby makes a
ruling that bearing in mind the minimum wage rates in 2015-2017, the
minimum rates are increased by RM100 across the board and salary
adjustment of 6% for the maximum rates rounded off to the nearest Ringgit.
The following Salary Structure - Annex B shall apply and govern the 13th
Collective Agreement:
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pg 46 v. Assunta Hospital [2020] MELRU 301

[135] In regard to the Rates of Increment, the Union cited the case of
Association of Bank Officers, Peninsular Malaysia v. Malaysian Commercial
Banks' Association [1981] 1 MELR 60; [1981] 1 ILR 136 (Award No: 54 of
1981), which stated the principle on which annual increments are granted. The
case law stated that as a general rule, the quantum of added value of the
employee (in terms of skills and experience) should not exceed 5% of salary
per annum. From the evidence available, the Court finds there is no necessity
to review the Rates of Increment it and maintains the rates as per the 12th
Collective Agreement.

Conclusions

[136] This Award is handed down after taking into consideration the views
and valuable inputs of both Honourable Panel Members whom are very
knowledgeable and experienced individuals. The Chairman takes this
opportunity to thank them for their attentiveness and support to the Court
throughout the hearing and deliberations over the 13th Collective Agreement.

[137] It is pertinent to note here for the record that the parties had referred to
numerous collective agreements which the Union had signed with the
respective hospitals; some were hospitals in the Klang Valley and some from
the northern region. Nevertheless, the Court views that in making comparisons
with other hospitals, the benchmark should be similar establishments in the
same region. Hence, the Court has been guided by the evidence adduced by
both parties but gave preference to comparable establishments within the
Klang Valley.

[138] Generally, employers would in all likelihood attempt to fulfil its

obligations to its employees and the various demands by the unions
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[2020] MELRU 301 v. Assunta Hospital pg 47

representing their employees. This is to ensure that the employees are satisfied
with the work environment as well as the terms and conditions of their
employment. In turn, happy employees will deliver better and quality service
to customers, stakeholders and the like. Thus, ensuring the company's
relevance and competitiveness in that particular industry. Despite the
Hospital's stand that it must ensure quality medical care to its patients within a
very tight operational budget, its own employees' welfare must be taken care of
as well because they are the Hospital's frontliners and are exposed to various
risks in the industry. Nevertheless, in all negotiations to conclude a collective
agreement, it must always be borne in mind that the employer must be able to
honour the promises made that are embodied in the collective agreement.

[139] When it comes to financial matters, the employer's financial capacity is

an important factor to be considered by the Court where a trade dispute has
been referred to it by any party. The other benefits in the collective agreement
are also important as they contribute to a better and holistic working
conditions for the employees. In this regard, the Court has taken into
consideration the principles in subsection 30(4) of the 1967 Act in making this
Award by taking into account factors such as public interest, financial
implications, the impact on the country's economy as well as the industry
concerned and relevant industries in which the Award may possibly affect.
Further, the Court is also guided by the principles of equity, good conscience
and substantial merits of the case in subsection 30(5) and the provisions in
subsection 30(6) of the 1967 Act. Hence, the Court awarded some of the
proposals to the Union while maintaining the status quo in many of the
Disputed Articles for the Hospital to ensure a balanced and workable Award
in the interest of all concerned parties.

[140] The signed Agreed Articles marked as Appendix A is annexed to this

Award and they shall form an integral part of this Award in respect of the 13th
Collective Agreement.
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