In Malaysia, employment related disputes are not resolved in the same forum.
Depending on the nature of the dispute and the relief sought, a claim may fall under the Labour Court (JTK) or the Industrial Court (JPP).
While both Courts deal with employment matters, their jurisdiction and types of remedies they can grant are fundamentally different. Choosing the wrong forum can result in wasted time, limited remedies and costs.
In this article, we explain the key differences between the Labour Court and the Industrial Court, so that employers and employees can better understand where their dispute belongs.
1. Overview of the Two Forums
Proceedings before the Director General of Labour (“Labour Court”)
The Labour Court is established under section 69(1) of the Employment Act 1955 (EA 1955). Proceedings are usually presided over by a Labour Officer from the Department of Labour (Jabatan Tenaga Kerja or JTK).
Industrial Court
The Industrial Court is established under the Industrial Relations Act 1967 (IRA 1967). It is a specialised tribunal, typically chaired by a Court President or Industrial Court Chairman, who are generally legally trained.
2. Jurisdiction: What Disputes Go Where?
Labour Court Jurisdiction
The Labour Court’s jurisdiction covers disputes arising from infringement of rights under the EA 1955. Common disputes heard by the Labour Court include:
a) Unpaid wages or salary.
b) Unpaid overtime payments.
c) Unfair deduction of salary.
d) Unpaid salary in lieu of notice.
e) Termination of employment without notice.
Importantly, the Labour Court does not have jurisdiction to hear claims for unfair dismissal.
Industrial Court Jurisdiction
The Industrial Court’s jurisdiction has a broader but more specialised jurisdiction. Among the disputes commonly heard by the Industrial Court include:
a) Unfair Dismissal claims.
b) Trade Disputes (such as picketing or strikes).
c) Interpretation, amendment or variation of collective agreements.
3. Nature of Remedies: Key Differences
One of the most important differences between the Labour Court and the Industrial Court lies in the types of remedies they can grant.
Remedies in the Labour Court
The Labour Court’s remedies are primarily monetary. The Labour Court will make orders for payment of outstanding wages or salary in lieu of notice after the hearing.
The Labour Court will not grant orders such as reinstatement or compensation for unfair dismissal.
Remedies in the Industrial Court
The Industrial Court has significantly wider remedial powers, especially in dismissal cases.
The Industrial Court can grant an award to reinstate an employee back to its employment or if that is not possible, to award compensation in lieu of reinstatement.
The Industrial Court can also award back-wages, which is to compensate the dismissed employee for loss of earnings.
Further, the Industrial Court does not merely look at what is owed to the employee, but whether the employer’s conduct was just and fair.
4. Use of Lawyers in either Courts
Labour Court
In Labour Court matters, both the employer and employee can be represented by lawyers on the day of inquiry or trial.
Industrial Court
Legal representation is allowed in the Industrial Court proceedings and employers and employees are commonly represented by them.
5. Enforcement and Finality
Labour Court Awards
Any award made by the Labour Court can be enforced as an order of the Magistrate or Sessions Court.
If a party is dissatisfied with the decision of the Labour Court, they may appeal against such order to the High Court.
Industrial Court Awards
An Industrial Court award stands on its own and is enforceable at the Industrial Court.
If a party is dissatisfied with the decision of the Industrial Court, they may appeal against such decision to the High Court.
6. Conclusion
Both the Labour Court and the Industrial Court deals with employment disputes but serve very different purpose.
If you are an employee, it is crucial that you determine the remedy you are seeking for before filing your complain to the relevant forums.
If you feel that you have been unfairly dismissed and intend to challenge the wrongful dismissal, then you should file your complain to the Industrial Court.
However, if you are merely challenging the breach of your rights under the EA 1955 and seek monetary compensation, the Labour Court is the forum to go to.
If you are facing an employment dispute or are unsure which forum applies to your situation, obtaining preliminary legal advice can help you avoid costly missteps and ensure your rights are properly protected.
DISCLAIMER
This article is for informational and educational purposes only and should not be considered legal advice. For personalized guidance and advice, please consult a qualified lawyer.
Tristan & Partners 