In the context of the Maritime Labour Convention (MLC), the International Labour Organization (ILO) helps governments and employers’ and workers’ organizations to establish a sound labour relations, adapt labour laws to changing economic and social circumstances and improve labour administration. The ILO encourages `tripartism’ within Member States as this will promote a more strong employers-employees or the social partners relationship. Effectively social dialogue should works best with organizations that are embracing the different elements and approaches of consultation and negotiation on a continuous process   rather than ad hoc or during crisis only. Respect for the fundamental rights of freedom of association is another. Strong, independent workers’ and employers’   organizations   with   the   technical capacity and knowledge required to participate in social dialogue. Will social dialogue be a culture in shipping lines after full implementation of MLC? Will it exists? How much involvement of Seafarers Union can be in the running of shipping companies on crew matters is rather unknown at least for now.

It helps build trust between employer and employees which sometimes may overcome some of the companies’ business issues with the solid cooperation and support from the workforce. Under this trusted cooperative environment it develops a consultative cultures of an organization that has a strong trade unions representing the various levels of employees in the organization. Ultimately, after the information exchange between the social partners, consultation and negotiations, an amicably to reach for a ‘win- win’ situations. Firstly, a better recognition by the employers onto workers representatives   has become a prerequisite needs for future structural changes in the service industry. By improving the working conditions of ships’ crew or ports’ workforce helps to improve the operational effectiveness and efficiencies to a greater heights thus will enhance the industry’s social economic development.



Social dialogue, social partners, unions, consultation, negotiation and informative exchange.



In the era of an increasingly competitive and interdependent world economy, employers begin to recognize the importance of social dialogue and understand the benefits it can contribute both

economically and the socio economically to the organization. The term social dialogue describes

a cooperative approach to labour relations. Indeed “the main goal of social dialogue itself is to promote consensus building and democratic involvement among the stakeholders in the world of work” (Economic Planning Unit, n.d.)

The word “dialogue” comes from the Greek dia (meaning “through” or “with each other”) and logos (meaning `word’). In everyday language, it is understood to mean “exchange of words between two people”, but it also conveys a sense of “meaning flowing through” . (UNCTAD, 2001)

image-social-dialogue-2The most basic form of social dialogue is the information exchange. This does not involve real discussion but the information sharing form the basis of some decisions made. Understanding the issues through sharing of information sometimes build the relationships between employer and employees even stronger. The other forms of social dialogue are consultation and negotiation respectively.   Consultation between the social partners normally generated from the information sharing which at times would require some clarifications on the issues raised. Negotiations are normally involve during collective bargaining process between employer’s representatives and workers representatives. The results will be in the form of Collective Agreement between the two parties. The goal is to promote consensus building and democratic involvement among the social partners.


The basic enabling conditions for the effective representation of the social partners are:

o   Freedom of association

o   Democratic foundations (of society in general and the representative organizations of the social partners in particular)

o   Legitimacy (through representative, transparent, accountable and cohesive employer and employee organizations)

o   Political will and commitment to engage in social dialogue

o   Social acceptance of the role/activities of the social partners

o   Technical competence of the social actors to engage in social dialogue

o   Capacity to deliver (Ishikawa, 2003)


Social dialogue and the practice of tripartism between governments  and the  representative organizations of workers and employers within and across borders are now more relevant to achieving solutions and to building up social cohesion and the rule of law through, and other means, international labour standards.

ILO Declaration on Social Justice or a Fair Globalization


Role of Social Dialogue

Social dialogue plays a very important role for the ILO’s to achieve its objective for employees to obtain decent and productive work in conditions of freedom, equality, security and human dignity. Social dialogue includes all types of negotiation, consultation and exchange of information between or   among, representatives of governments, employers and workers on issues of common interest. It can exist as a tripartite process, with the government as an official party to the dialogue or it may consist of bipartite relations between labour and management, with or without indirect government involvement. It can be informal or institutionalised, and often is a combination of the two. It can take place at the national, regional or at enterprise level.


Case Study: The context of social dialogue in the privatised port environment at Port Kiang, Malaysia Experience. (Employer and Union Relationship)


In 1983, the Malaysian Government first announced the Privatisation Policy that represents a new approach in the national development policy and complements other national policies such as the Malaysia Incorporated policy, developed to underscore the increased role of the private sector in the development of the Malaysian economy. This approach is to facilitate the country’s economic growth, reduce the financial and administration burden of the Government, reduce the Government’s presence in the economy, lower the level and scope of public spending and allow market forces to govern economic activities and improve efficiency and productivity in line with the National Development Policy.

image-social-dialogue-3In respect of ownership of wealth, the privatisation policy forms an integral part of the Government’s strategy in realizing active participation by Bumiputera in corporate sector to correct the imbalances in the corporate sector participation. In implementing the policy, the Government published statements from time to time to explain to the public the objective and content of the policy as well as to keep the general public informed. The Government published the Malaysian Privatisation Master Plan (PMP) in 1991 after publishing the “Guidelines on Privatisation” in 1985. This is to ensure that the privatisation effort is channelled to appropriate areas to optimize the impact of the policy implementation in terms of the achievement of the policy objectives. The Master Plan explained the implementation of the policy as well as the progress achieved and addressed the future direction of the programme.


Three Pillars of Social Dialogue

  1. Information Exchange
  2. Consultation
  3. Negotiations –

     (Turnbull, 2006)


The Guidelines on Privatisation detailed among others, the objectives of the policy, the methods applicable and the implementation machinery. Several developments have taken place since the policy was first announced. The significant changes which have been introduced by the Government include  the  amendments  of  the  various  laws to  allow  privatization  to  take  place and  the commissioning of a study to help in the drawing up of a privatisation Master Plan. The privatised entity should allocate 30% of its equity to Bumiputera. Foreign participation in a privatized entity is limited to a maximum of 25 % of its share capital. (Malaysian Privatisation Master Plan, 1991)

Port Klang’s container terminal was the first of the government agencies chosen for commercialization. At that time, the port performance was poor with very low productivity aging infrastructure and lack of modern cargo handling equipment. Port workers were members of several trade unions representing different group of employees. Port Staff Union (PASU), Harbour Workers Union (HWU), Ancillary Services Association and a Senior Officers Association (SOA) also registered as a trade unions to name a few. These social partner members were of from different level of the work force representing a different work cultures and behaviours. They went into several pickets and strikes when issues were not resolved.


When the port went into a privatization exercise in 1985, the employees were very fearful of losing jobs due to the change of ownership and very much fearful of the work demand in a commercial corporate cultures. There had never been any retrenchment under government ownership. However the principle of privatisation based on the Economic Planning Unit (EPU) guidelines state clearly that privatisation shall not lead to any displacement of workers and they are to be employed in the privatised environment under conditions not less favourable than those that they may had enjoyed before when they were under the Government. Even that some of the union leaders were creating fears of uncertainty among the members. Negotiations with the union leaders were quite a tough one. Only the intervention by the Prime Minister, Tun Dr. Mahathir Mohammed who met with the union leaders cleared some of the fears they had.

It is the Government’s hope that more people will be able to share the wealth of the nation this way. After several negotiations meeting between the Port Authority, Unions and the Management of the new company called Kelang Container Terminal (KCT) a joint venture between Kontena Nasional (KN) and P&O Ports Australia Ltd. During the exercise, employees were offered three options: redundancy or remaining employed by Klang Port Authority (KPA) or to resign from KPA to join KCT. About 800 workers crossed over to join KCT where each were guaranteed of employment for five years. Incentive base salary compensation was one of the key elements of KCT human resource management strategy. In recognition to the workforce due to a significant improvement in performance they were given a token amount of bonus at the end of the first operating year.

In view of the commercial approach port management administrations and operations, the working conditions were improved considerably, better incentives and better employees’ participation in the company’s development. Employees enjoyed working in this new environment resulting in more understanding, cooperative relationship between the social partners. After the privatisation exercise, KCT employees were only members of an in house union. Issues were mostly resolved through social dialogue in the forms of information exchange, consultation and negotiation.  In recent years globalization has driven a strong impact in the port industry demanding improvement in port efficiency and reduce vessels port stay time. This has created a new agenda for social dialogue in a commercial port environment. A wellbeing of an employee will also reflects the wellbeing of an organization.

In view of the frequent change in the port management leadership as well as the unions’ leadership, it was observed that the relationship between unions and employers has been very much more cordial now, including the environment during the collective bargaining exercise. This helps to a better negotiations results. Successful social dialogue structures and processes have the potential to resolve important economic and social issues, encourage good governance, advance social and industrial peace and stability and boost economic progress. Although, the performance of the privatised ports in Malaysia has been declining as compared to new private terminals, the social dialogue in the privatised ports are still very much alive not at the new terminals where social dialogue is hardly in existence or only at a minimal level practice. There is no negotiations nor consultation in the organization but just simply an information exchange between management and its employees.


(Note: The writer was one of the Senior Officers Association (SOA) Council Member during the 2nd Port Klang Privatisation exercise in 1992).


Social Dialogue in Maritime Labour Convention (MLC)

MLC covers the followings:

  • An employment agreement, guaranteeing decent on-board working and living conditions, to be signed by both the seafarer and the Shipowner, or a representative of the Shipowner. Monthly pay, in full and in accordance with the employment agreement and any applicable collective agreement.
  • 14-hour work limit in any 24-hour period, 72 hours in any seven-day period
  • The Shipowner must pay to repatriate a seafarer in case of illness, injury, shipwreck, insolvency, sale of ship and so on.
  • Specific requirements for living accommodation and recreational facilities — including minimum room sizes, and satisfactory heating, ventilation, sanitary  facilities,  lighting  and hospital accommodation.
  • Access to prompt medical care when on board and in port



When a Collective Bargaining Agreement is signed by both the seafarer and the Shipowner, or a representative of the Shipowner, the managers in the office have to ensure that the crew are well taken care off. Providing a comfortable and safe workplace on board is undoubtedly at the top of master’s responsibilities.  Adopted in February 2006, the ILO’s Maritime Labour Convention sets the minimum standards to ensure satisfactory conditions of employment for the world’s seafarers. It brings together and updates over 65 other ILO maritime labour instruments, while introducing a system of certification and inspection to enforce it.  Shipping lines shall be complied with the Convention by obtaining holding a Maritime Labour Certificate and Declaration of Maritime Labour Compliance issued by the flag state, which must be available on board for any port state inspection. These information shall be shared with the Seafarers Representatives. When the above are being complied with, will social dialogue be still relevant?



ADB. (2000). Developing Best Practices for Promoting Private Sector Investment in Infrastructure — Ports (Manila)

Ali H. (1994). Impact of Port Privatisation in Malaysia with a Case Study of Port Klang, unpub. MSC Dissertation, Cardiff University.

Malaysia Economic Planning Unit. (1994). Privatization Master Plan. Kuala Lumpur. Percetakan Nasional Malaysia Berhad.

International Labour Organization. (1995). Social and Labour Effects of Structural Adjustment in the Port Industry of Selected Asian and Pacific Countries, Report of the ILO Regional Seminar, Pattaya, Thailand, 15-21 March (Geneva)

Ishikawa, J. (2003). Key Features of National Social Dialogue: A social dialogue Resource Book (Geneva, International Labour Organization)

Turnbull, P. (1996) Port Workers and Privatization, unpub. Paper. University of Leeds