Industrial Relations Ordinance and Industrial Arbitration Court



The Industrial Relations Ordinance, 1960, was a piece of legislation that sought to regulate relations between employers and employees in Singapore at a time when the country was embarking on an economic makeover following the institution of self-government in 1959. The ordinance contained rules on collective bargaining, conciliation and arbitration that were aimed at preventing or settling disputes between management and staff.[1] Although modelled after similar legislation found in the state of Western Australia, the ordinance was unique in trying to create a trade dispute settlement system that combined freely initiated collective bargaining with compulsory arbitration in a way that suited local conditions.[2] The legislation had two main objectives: first, to ensure that workers were fairly rewarded for their labour; and second, to bring about stable industrial relations in Singapore that would enable economic growth and job creation.[3]

Singapore’s economic conditions in the 1960s
Singapore’s population grew rapidly in the post-war years from about 938,000 people in 1947 to over 1.4 million by 1957.
[4] The population increase created a growing unemployment problem in Singapore. In 1950, the state-run Employment Exchange had some 15,200 new registrants looking for work. The exchange had been established in 1946 as a section of the Labour Department to help workers find suitable employment. By 1959, the number of new registrants had more than doubled to over 36,700 although there were only 4,600 job vacancies available. Almost two-thirds of new registrants were below the age of 30 while more than three-quarters of jobs available were for people between the ages of 30 and 45.[5]

The unemployment situation was not helped by the frequent industrial stoppages in the post-war years which sometimes threatened to bring Singapore’s economy to a standstill. Much of the labour unrest was encouraged by opposition groups who made use of the trade unions to challenge the colonial system and gain political power.
[6] [7] In 1946 alone, some 845,600 man-days were lost due to strikes and lockouts organised by trade unions. The figure dropped to a low of just under 4,700 man-days in 1950 but rose rapidly in subsequent years to peak at 946,400 man-days in 1955. The number of industrial stoppages stabilised in the following years, with 26,600 man-days lost as a result of trade disputes in 1959.[8]

A few months before the 1959
general election, the opposition People’s Action Party (PAP) unveiled its proposed economic policy through Central Executive Committee member Goh Keng Swee.[9] Goh identified finding employment opportunities for a young and rapidly growing population as the main economic problem that Singapore would be facing in the years ahead. He warned that a failure to address this issue would lead to social and political problems for Singapore. Goh proposed creating more jobs by expanding the economy through an industrialisation programme centred on manufacturing industries.[10]


Prior to Goh’s speech, then PAP Secretary-General Lee Kuan Yew had outlined the party’s labour policy.[11] If elected, Lee promised that the PAP would be “a government on the workers’ side”.[12] However, Lee stressed that the PAP would seek to balance the interests of workers with those of all Singaporeans by ensuring that the economy as a whole was not damaged by industrial unrest. Lee called such a policy “industrial peace with justice”.[13]

To help maintain peaceful relations between employers and workers, Lee proposed the establishment of a permanent and independent Court of Labour with powers to arbitrate disputes and hand out legally enforceable awards. An independent president would head the court with support from a research team tasked with building up expert knowledge on economic trends affecting Singapore. This would inspire confidence in employers and employees, as well as ensure that the court would take into account Singapore’s overall economic situation when handing out awards.
[14]


Legislation for settling industrial disputes
Following the PAP’s success in the May 1959 general election, then Minister for Labour and Law
Kenneth M. Byrne first tabled the Industrial Relations Bill in the Legislative Assembly on 13 January 1960.[15] Byrne described the bill as an attempt to “substitute the rule of law for the law of the jungle in industrial relations”.[16]


The bill was designed to create a three-tier system for settling disputes between employers and employees. The system called for first, collective bargaining to arrive at freely negotiated agreements; second, conciliation with the aid of government officers to remove obstacles in negotiations; and finally, compulsory arbitration through a court when agreement could not be reached. It was hoped that such a system would ensure stable industrial relations and prevent strikes and lock-outs that caused economic loss to the whole community.[17]

The bulk of the Industrial Relations Bill contained provisions concerning the constitution, powers and functioning of the Industrial Arbitration Court. First, the court would be headed by a president appointed by the Yang di-Pertuan Negara (Malay for “Head of State”) on the advice of the prime minister. The president would be given the same “rights, privileges, protection and immunity” as that of a judge of the Supreme Court.
[18] The court would be tripartite in character, with the president assisted by two members, each drawn from an employer and employee panel respectively. The Minister for Labour and Law would be responsible for appointing representatives to fill each panel while the selection of the two members would reflect the preferences of the disputing parties.[19]

Second, the bill contained provisions empowering the court to take into consideration the economic condition of the state and the interests of the community at large when arbitrating a dispute. Furthermore, the court would be given the exclusive authority to decide the rights and duties of parties involved and review awards handed out. This meant that other courts of law would have no authority to pass judgement on trade disputes or to review the court’s arbitration decisions.[20]

Third, the bill set out the ways in which the court would be notified of a trade dispute. This included being informed with the consent of the disputing parties, through a notification in the Government Gazette issued by the Minister of Labour and Law when an essential service was affected, or through a proclamation by the Yang di-Pertuan Negara when the public interest was at stake.[21]

Finally, the bill stipulated that lawyers would no longer be allowed to represent disputing parties in the court. This was to prevent trade unions that had insufficient financial resources to hire lawyers from being put at a disadvantage during arbitration.  More importantly, the new ruling was meant to encourage greater professionalism among union officials and management staff officers as only they would be allowed to represent workers and employers respectively in trade disputes.
[22] For trade unions that lacked the resources to train officials in handling trade disputes, the bill provided for the creation of a new category of government officers called “Industrial Relations Officers” to assist in such matters.[23]

Reactions to the proposed legislation
PAP members of the Legislative Assembly supported the bill as they saw it as fulfilling the party’s election campaign pledge to pursue a labour policy of “industrial peace with justice”.[24] Opposition members such as Lim Yew Hock and A. P. Rajah also supported the bill’s main principle of bringing about industrial peace. However, given the importance of the bill, they suggested that it be referred to a select committee so that views from all interested parties could be sought and considered.[25]

Then Prime Minister Lee Kuan Yew reminded the assembly that the bill’s main objective was ensuring stability in industrial relations. Lee stressed that such stability was essential for the expansion of industry and with it the creation of jobs for the increasing numbers of young people seeking employment. Given the urgency of the situation, Lee urged the assembly not to delay the passing of the bill.
[26] Byrne responded to the opposition’s call for more consultation by pointing out that he had already consulted various trade union representatives and the Employers’ Federation before drafting the bill. He therefore did not see the need to send the bill to a select committee for further consultations.[27]


Following the second reading and debate on the bill on 10 February 1960, it was committed to a Committee of the whole Assembly for consideration.[28] Over the course of two days – from 12 to 13 February 1960 – members of the assembly vigorously debated the numerous new amendments to the bill proposed by Byrne. The PAP was able to use its majority position in the assembly to push through the amended bill and it was passed after a third reading on the second day.[29] [30]

The Industrial Relations Ordinance came into effect on 15 September 1960.
[31] Byrne claimed that the delay was due to holdups in the construction of offices for the Industrial Arbitration Court which was to be housed in the Supreme Court Building. He denied accusations made by the opposition that the delay was to allow the Trade Unions Bill to be introduced and passed first.[32]

The aftermath
Following the enactment of the Industrial Relations Ordinance, the Industrial Arbitration Court was officially opened on 24 October 1960.
[33] Charles Gamba, an Australian economics professor with arbitration experience in Malaya, was appointed as the court’s first president.[34] A booklet was subsequently published to inform employers, trade unionists and the general public of the function and powers of the court.[35]

The Industrial Arbitration Court quickly got down to work. In 1962, it handed out 15 arbitration awards following and certified a total of 264 collective agreements covering over 41,000 workers.
[36] Despite the court’s efforts at resolving trade disputes, industrial stoppages continued to disrupt the economy in the early 1960s. Some 410,900 man-days were lost due to stoppages in 1961, with another 388,200 man-days lost in 1963.[37] This state of affairs prompted the government to introduce various amendments to the ordinance, the most significant of which were contained in the Industrial Relations (Amendment) Act, 1968.[38]



Author
Jamie Han & Lim Tin Seng



References
[1] Singapore. 1960 Supplement to the Laws of the State of Singapore. (1963). Industrial Relations Ordinance, 1960 (Ord. 20 of 1960). Singapore: [s.n.], pp. 164–200). (Call no:. RCLOS 348.5957 SIN)
[2] Kleinsorge, P. L. (1970). Singapore’s Industrial Arbitration Court: Collective bargaining with compulsory arbitration. In T. C. Kan, et al. (Eds.), The law of industrial relations in Singapore. Singapore: University of Singapore Law Society, pp. 55–57. (Call no.: RSING 331.16 KAN)
[3] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12, cols). Singapore: [s.n.], cols. 190–191. (Call no.: RCLOS 328.5957 SIN)
[4] Saw, S. H. (2007). The population of Singapore (2nd ed.). Singapore: Institute of Southeast Asian Studies, p. 15. (Call no.: RSING 304.6095957 SAW)
[5] Labour Department. (1961). Annual report of the Labour Department, 1959. Singapore: Govt. Printer, pp. 4–6, 108. (Call no.: RCLOS 331 SIN)
[6] Huff, W. G. (1994). The economic growth of Singapore: Trade and development in the twentieth century. Cambridge: Cambridge University Press, pp. 294–296. (Call no.: RSING 338.95957009 HUF)
[7] Turnbull, C. M. (2009). A history of modern Singapore, 1819–2005. (Rev. ed.). Singapore: NUS Press, p. 276. (Call no.: RSING 959.57 TUR –[HIS])
[8] Ministry of Labour. (1977). Industrial Relations Act: Law and practice. Singapore: Author, p. 19. (Call no.: RCLOS 344.595701 SIN)
[9] PAP plan for single mart with Malaya. (1959, March 23). The Straits Times, p. 1. Retrieved from NewspaperSG.
[10] People’s Action Party. (1959). The tasks ahead: PAP’s five-year plan, 1959–1964, part 1. Singapore: Author, pp. 19–20. (Call no.: RCLOS 329.95957 PEO)
[11] ‘Jungle law in the industries’. (1959, March 2). The Straits Times, p. 2. Retrieved from NewspaperSG.
[12] People’s Action Party. (1959). The tasks ahead: PAP’s five-year plan, 1959–1964, part 2. Singapore: Author, p. 24. (Call no.: RCLOS 329.95957 PEO)
[13] People’s Action Party. (1959). The tasks ahead: PAP’s five-year plan, 1959–1964, part 2. Singapore: Author, p. 25. (Call no.: RCLOS 329.95957 PEO)
[14] People’s Action Party. (1959). The tasks ahead: PAP’s five-year plan, 1959–1964, part 2. Singapore: Author, p. 27–28. (Call no.: RCLOS 329.95957 PEO)
[15] Singapore. Legislative Assembly. Debates: Official Report. (1960, January 13). First Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], col. 14. (Call no.: RCLOS 328.5957 SIN)
[16] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], col. 151. (Call no.: RCLOS 328.5957 SIN)
[17] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 150–151. (Call no.: RCLOS 328.5957 SIN)
[18] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 12). Committee Stage of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], col. 247. (Call no.: RCLOS 328.5957 SIN)
[19] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 152–153. (Call no.: RCLOS 328.5957 SIN)
[20] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], col. 154. (Call no.: RCLOS 328.5957 SIN)
[21] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 12). Committee Stage of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], col. 242. (Call no.: RCLOS 328.5957 SIN)
[22] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], col. 153. (Call no.: RCLOS 328.5957 SIN)
[23] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 12). Committee Stage of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 244–245. (Call no.: RCLOS 328.5957 SIN)
[24] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 165, 177. (Call no.: RCLOS 328.5957 SIN)
[25] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 162–164, 170–171. (Call no.: RCLOS 328.5957 SIN)
[26] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 189–192. (Call no.: RCLOS 328.5957 SIN)
[27] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 197–202. (Call no.: RCLOS 328.5957 SIN)
[28] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 10). Second Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], col. 202. (Call no.: RCLOS 328.5957 SIN)
[29] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 12). Committee Stage of the Industrial Relations Bill (Vol. 12, cols. 221–310). Singapore: [s.n.], cols. 221–310. (Call no.: RCLOS 328.5957 SIN)
[30] Singapore. Legislative Assembly. Debates: Official Report. (1960, February 13). Considered in Committee, Reported and Third Reading of the Industrial Relations Bill (Vol. 12). Singapore: [s.n.], cols. 313–344. (Call no.: RCLOS 328.5957 SIN)
[31] State of Singapore. Government Gazette. Subsidiary Legislation Supplement. (1960, September 15). The Industrial Relations Ordinance, 1960 (S 220/1960). Singapore: [s.n.], p. 897. (Call no.: RSING 348.5957 SGGSLS)
[32] Singapore. Legislative Assembly. Debates: Official Report. (1960, September 21). Industrial Relations Ordinance, 1968 (Reasons for delay in operation) (Vol. 13). Singapore: [s.n.], cols. 645–647. (Call no.: RCLOS 328.5957 SIN)
[33] Gamba opens state’s first industrial court. (1960, October 24). The Singapore Free Press, p. 1. Retrieved from NewspaperSG.
[34] Gamba picked to settle all labour disputes. (1960, September 15). The Straits Times, p. 14. Retrieved from NewspaperSG.
[35] Registry of the Industrial Arbitration Court. (1961). The Industrial Arbitration Court, its functions and powers. Singapore: Govt. Printer. (Call no.: RCLOS 331.89140615957 SIN)
[36] Industrial Arbitration Court. (1963). Annual Report of the President, Industrial Arbitration Court, 1962. Singapore: Govt. Printer, pp. 10, 21. (Call no.: RCLOS 354.59570683 SIACAR -[AR])
[37] Ministry of Labour. (1977). Industrial Relations Act: Law and practice. Singapore: Author, p. 19. (Call no.: RCLOS 344.595701 SIN)
[38] State of Singapore. Government Gazette. Acts Supplement. (1968, August 15). Industrial Relations (Amendment) Act, 1968 (No. 22 of 1968). Singapore: [s.n.], pp. 229–238. (Call no:. RCLOS 348.5957 SIN)



The information in this article is valid as at 21 April 2014 and correct as far as we are able to ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.

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