Government Backs Trade Unions for the AI Shift: Is HR Ready?

At the National Trade Union Convention on 10 September 2026, the Human Resources Minister said RM3.5 million under the 2026 Trade Union Affairs Programme grant had been distributed to strengthen unions as AI, automation and digitalisation reshape work, and called for stronger tripartite cooperation. This news adds no new consultation duty; it does signal the questions employers should be ready to answer. Read the news report.

A new system may be a productivity project to management, but employees ask whether duties, skills, pay, shifts or jobs will change. HR should enter the project before the technology and headcount decisions are locked, so it can shape the response rather than simply deliver it.

Know where the legal duty ends and the IR work begins

Sections 4 and 5 of the Industrial Relations Act (IRA) 1967 protect union rights and prohibit specified employer interference, with section 8 providing a route for complaints. Where a recognised union and collective agreement apply, check the agreement before changing negotiated terms or using a process it prescribes. A union has no automatic veto over every operational decision; the obligation depends on the proposed change and applicable terms. Early engagement still gives management room to explain the business case and hear concerns before positions harden.

Consider a warehouse introducing automated picking. Operators may move into monitoring, new technical tasks may appear, and some employees may need retraining. A blanket assurance that no one should worry will not answer who qualifies for training, whether grades will change or how staff would be selected if fewer roles remain. HR should separate confirmed decisions from open questions and give employees a date for the next update.

What we recommend HR to look into 

1. Compare the old and new jobs. Record current and proposed duties, grade, pay, shifts, location, reporting line and KPIs; identify losses of status, added responsibilities and roles at risk.
   

2. Test whether changes are material. A new tool may change tasks, but a loss of status, major change in duties or reduction in pay needs closer review. Check the contract and collective agreement, consult the employee and seek agreement before implementing a fundamental variation that could invite a constructive dismissal claim.
   

3. Engage the union on the job map. Share affected roles, selection criteria and realistic training or redeployment options early, follow any collective agreement procedure, and record the alternatives raised before final individual outcomes.
   

4. Treat disappearing roles as potential redundancy. Assess retraining and redeployment, document the business rationale and fair selection, and meet applicable notification, benefits and consultation duties. Do not disguise a redundancy as poor performance.
   

AI may change tasks faster than a company updates its employment terms. Bring HR into the project early, engage the union where appropriate and record the basis for individual decisions.