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Malaysia’s booming electronics industry leaves little room for workers’ rights

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21 May, 2024Malaysia has become a hotspot for global electronics and semiconductor investment, with country's electrical and electronics export seeing a sharp increase of 54.2 per cent. However, the surge of electronics and semiconductor investment in Malaysia is sharply contrasted with low unionization; only six per cent of all Malaysian workers are unionized, the majority in the public sector.

According to reports, Intel will build a new chip assembly plant valued at US$7 billion, with a 3D chip packing plant in the pipeline. Infineon will construct the biggest 200mm silicon carbide power fabrication plant in Malaysia. Texas Instruments is expanding its operation by adding two new assembly and test facilities. Jabil, Bosch, Micron, Western Digital, Alton, Indium, AT&S and ATX will either expand their operations or build new manufacturing facilities in Malaysia.

But the booming industry leaves little room for workers’ rights. Electronics unions were banned in the 1970s but thanks to international pressure the government approved in-house unions in the late 1980s.

In 2009, the government allowed the establishment of regional electronics unions. In the ensuing years Electronics Industry Employees' Unions (EIEU) western region, Southern region, Northern region and Eastern region were formed. The four unions are affiliated to IndustriALL as EIEU coalition.

EIEU Coalition represents around 13,000 electronics workers in twenty companies, around 2.8 percent of the total electronics workforce. It is estimated that 471,800 workers are employed in the electronics sector in Malaysia.

Since its inception, EIEU Coalition has faced anti-union discrimination. In 2011, the EIEU Western region president Wan Noorulazhar bin Mohd Hanafiah was dismissed after the union was formed. The Malaysian government is investigating a complaint filed by EIEU western region on violation of workers' rights.

Two years ago, workers at Molex were intimidated during the secret ballot exercise. The Industrial Relations Department initiated an investigation and put the secret ballot on hold. EIEUNR submitted a voice recording with threats of the company management, but has since declined the department’s request for interviews for fear of exposing the unionists to further intimidation. The case remains pending in the court.

In a recent secret ballot at Texas Instruments Malaysia, management changed the shift schedule, arranged a few “appreciation meals” for workers on the polling day, and deployed the management team and security guards at noticeable areas to intimidate workers.

Bruno Periera, the pioneer of organizing in the electronics sector and general secretary of EIEU Western region, says that for 50 years the Malaysian government has attracted foreign electronics investment by providing a weak union environment.

“Disapproval of setting up a national electronics union, an unfair secret ballot formula that counts absentee votes against the unions, weak enforcement of the Industrial Relations Act that prohibits union busting by the authority, widespread intimidation of local and migrant workers during the organizing process, are factors that contribute to the low unionization and collective bargaining coverage in Malaysia’s electronics sector,”

says Periera.

A silver lining for the Malaysian labour movement is that the Trade Union Act amendment, which allows cross-sector organizing and democratic competition among trade unions, will create an enabling environment for organizing in the electronics sector.

The Labour Law Reform Coalition (LLRC), a coalition of 58 trade unions and NGOs led by IndustriALL Malaysia affiliates, is continuously advocating for stronger worker protection laws and regulations to facilitate organizing.

The coalition’s secretary-general and IndustriALL Executive Committee member Gopal Kishnam Nadesan is calling on the government to make the secret ballot formula the same as the general election formula: unions obtaining the highest votes in the ballot box should be accorded recognition.

IndustriALL affiliates in Malaysia regularly file union busting complaints with the Industrial Relations Department demanding that action is taken against employers. Malaysian union leaders meet on a regular basis to exchange organizing and campaign strategies. The unions are increasing cooperation with migrant worker NGOs to reach out migrant workers and handle grievances.

Says Alexander Ivanou, IndustriALL electrical and electronics director:

“The booming electronics industry in Malaysia should be welcomed as it creates more jobs. However, IndustriALL urges multinationals to respect workers’ rights, in particularl freedom of association when establishing or increasing manufacturing facilities. Companies’ efforts to mitigate financial, operational, legal, geopolitical and other risks should not be done at the expense of workers’ fundamental rights and decent living.”