The recent ruling by the Industrial Court (IC) regarding the Festival Aid Memorandum of Agreement (FA-MOA) has been criticised for containing significant factual and legal errors.
“The case, which centers on the Festival Aid (FA) payment for 2024, saw the Malaysian Commercial Banks Association (MCBA) argue that the FA-MOA is not legally binding, claiming that the IC had not recognised it. This claim has been described as a mere afterthought since, at the time the FA-MOA was signed on April 5, 2023, the MCBA did not formally recognise the agreement,” said National Union of Bank Employees (NUBE) General Secretary J Solomon, in a statement issued by the union on Friday (Feb 7).
NUBE, the union representing bank employees, was countered in court by pointing out that the FA-MOA could not be officially recognised because it failed to meet the criteria set out in the Industrial Relations Act of 1967.
“NUBE presented evidence showing that MCBA member banks had previously paid the Festival Aid in 2023, despite now disputing the validity of the FA-MOA.
“The union also highlighted how the Minister of Human Resources had interfered in the 2024 FA payment and how the banks, despite recording significant profits and paying high salaries to their CEOs, were still reluctant to honour the FA payment to their employees.
“Additionally, the issue of banks paying Festival Aid to their staff in Indonesia was brought into the discussion,” Solomon said.
Despite these arguments, the Industrial Court sided with the MCBA, ruling that the FA-MOA was invalid due to the lack of cognisance. This decision echoed the MCBA’s stance that the agreement was not legally binding.
The ruling also contained several factual inaccuracies, including a statement that NUBE had delayed the 20th Collective Agreement negotiations, when it was in fact the MCBA that had refused to enter negotiations, he added.
He explained that the IC also rejected NUBE's request to summon the Minister of Human Resources, Steven Sim Chee Keong, to testify about his alleged abuse of power in meeting with the MCBA secretly to reduce the Festival Aid payment to just half a month’s salary for clerical staff and to make it a one-off payment.
“The court's decision failed to address these concerns, as well as other aspects of the case that NUBE argued were flawed, including criticism of union leader Brother Solomon and NUBE itself,” Solomon added.
In response to the IC’s decision, NUBE has filed an appeal in the High Court, continuing its fight for justice and for what it considers as fair treatment of bank employees.
This decision by the Industrial Court is seen by many as an example of how the banking industry and certain regulatory bodies, in NUBE’s view, act without integrity. NUBE remains committed to pursuing the case, with hopes that the truth will eventually come to light in higher courts, Solomon said.
On Feb 6, the IC ruled in favour of the MCBA in its ongoing dispute with the NUBE regarding the provision of festival aid to bank workers.
In the ruling, Industrial Court Chairman D. Paramalingam stated that the Memorandum of Agreement (MoA) on festival aid, which was signed on April 5, 2023, holds no legal or binding effect.
He explained that the MoA had not been submitted to the court for formal registration, as required by the Industrial Relations Act of 1967. As a result of the court’s decision, Paramalingam confirmed that banks are not obligated to provide festival aid beyond 2023.
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