Analysis of HRM and ER in Malaysia

INTERNATIONAL AND
COMPARATIVE HRM AND ER

Introduction
The essay brings out a discussion on analysis of human resource management practises and
employee relations in Malaysia. This essay discusses about the benefits and negative impact
on the local employees (Gunsteren, 2018). This analysis will continue on policies of the
country especially the multinational enterprises (MNEs) by several practises. It is seen that
host employees often are employed indirectly or directly by multinational enterprises (MNEs)
but at the same time, MNEs have their subsidiary organisations in Malaysia (Gunsteren,
2018). The essay will reveal the difference in their treatment of the employees by the
subsidiaries and the work performed by the employees in their headquarters. There is a
significant impact of multi-national companies, employee relations, and human resource
management practises (Gunsteren, 2018).
Analyse contemporary ER and HRM practices in respect
of Malaysia
Employee relation signifies the efforts, which have led to manage the relationships between
the employees. Good employee relations is a competitive advantage for the organisation as it
provides reasonable and fair treatment to every employee. This positive environment leads to
commitment and loyalty towards work. With the changing framework due to increasing
liberalisation, competitiveness, and globalisation, human is no more workers rather they are
more on assets to an organisation (Sasse, Bröckelmann, Goergen, Plütschow, Müller, Kreissl,
& Diehl, 2017). In today`s era, it is seen that Human resource management procedures
include workforce planning, commitment, placement, loyalty, employee engagement,
performance management, motivation, leadership, benefits, compensation, change strategy,
work time control, diversity, flexibility, talent management, rewards, labour relations,
communication and so on. This signifies that some of the elements are closely related to
employee relations. This report brings out several findings, which includes need for the

development in order to reduce the employment of the foreign employees and finally refine
them in such a way to target vulnerable local as well as foreign workers with the required
labour legislations. The main aim of essay is to find the effect of the recent exploitation of the
foreign employees as well as the local employees in the Malaysia (Epstein, Zelefsky, Sjoberg,
Nelson, Egevad, Galluzzi, & Eastham, 2016).
In Malaysia, Employment Act, 1955 and industrial relations Act, 1967 are regulating the
relation between employee and employer relationship in Malaysia. Currently, the country has
the unemployment rate of 3.6 percent as per the economic models. Employee relations in this
country is Multilateral as trade unions plays an important role in the tripartite cycle (Epstein,
Zelefsky, Sjoberg, Nelson, Egevad, Galluzzi, & Eastham, 2016). With the increased
globalisation, organisations always tend to remain advantageous and competitive. Further,
various aspects affect and increase in organisational profits such as positive employee
relations, which contribute to the sustainable growth in the organisation. It is seen that
employee relation is often criticised by various literatures in relation to union activities,
workplace regulations, and support from labour legislatives (Gunsteren, 2018). Therefore, the
issue of the foreign worker has become an issue as they have grabbed huge attention. It have
been seen that these have ended with crucial changes in recruitment process and it has ended
painfully with a traumatic environment that is not even being acceptable by the workforce of
Malaysia (Epstein, Zelefsky, Sjoberg, Nelson, Egevad, Galluzzi, & Eastham, 2016). It is seen
that there is no such intermediary named agent who can assist while hiring the foreign
employees in Malaysia. Although, due to suffering of foreign workers, the authority have
considered a joint authority between the human resources and home ministry while managing
the foreign employees. It becomes difficult while outsourcing the foreign workers especially
their safety and the procedure of recruiting all alone. Nearly hundred organisation is handling
more than 26000 workers from foreign through outsourcing system (The daily star, 2018).

Furthermore, HUM deal with existing agents with more time so finally they can relocate the
employees for the selected employers (Epstein, Zelefsky, Sjoberg, Nelson, Egevad, Galluzzi,
& Eastham, 2016). It is aimed to ignore unfair treatment with the employees and other more
issues, which are related to the workers. As per the ministry of human resources, foreigner
are more devoted to their work especially when they are given more work to do as their
request for the job. In addition, the wages is just as opposite to the local workers as foreign
workers have more responsibility for their family as well as they need more money to survive
if the currency is stronger (Gunsteren, 2018). Whereas, local employees deny for extra
working hour which encourages employment of foreign workers. Therefore, finally they (the
companies) moved out to foreign countries to reduce the future cost of the foreign employees.
However, the company is influenced by the initial low cost of hiring the labour at very less
cost. At last, the degree of labour turnover has been increasing as far as the local employees
are concerned. This situation maximises the degree of unemployment for the local
employee’s increases. Local managers and people at high positions in the hierarchy feel more
delighted to have foreign employees rather than choosing local workers (Epstein, Zelefsky,
Sjoberg, Nelson, Egevad, Galluzzi, & Eastham, 2016). This led to increase in foreign
employees, which further strengthen the competition for the jobs threatening the jobs of the
local workers. These lead to circumstances where there was high rate of unemployment, low
purchasing power, and negative GDP of the Malaysia, which further prevents the growth of
the economy (The star online, 2018). Other problem can be that local employees are short of
and discriminated while rewarding them. Local employees are threatened with the existence
of the foreign workers and this is because of the lower requirement of compensation, fringe
benefits, and quality of the work. Foreign workers who can afford to get lower wages and
wants employment replaces the local employees who are at the high costs (Gunsteren, 2018).
To stand in the competition, both local as well as the foreign employees are being exploited.