TOPIC 8

PERSONNEL SYSTEMS
IN LOCAL AUTHORITIES IN
MALAYSIA

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 LEARNING OUTCOMES

At the end of this lecture, student should be able to:

1. Understand the Closed/Separated system in local government

2. Explain the Fusion personnel system

3. Identify the Integrated system

4. Evaluate the personnel system practiced in Malaysia

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 INTRODUCTION
o Local government’s personnel systems are the
foundation upon which an organization’s work is
performed
o Local governments depend more on their
manpower in comparison with the national
government which makes it more important for
them to hire capable person and develop the
capabilities of these employees to the greatest
degree possible
o Local government have various types of personnel
systems.
i. Separated personnel system
ii. Integrated personnel system
iii. Fusion personnel system
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 1) CLOSED/SEPARATED SYSTEM

 In this system, the local councils behave more like a private

organisation and have full administrative autonomy over
hiring and firing of their staff.
 They have full autonomy over hiring and firing their staffs
 They can also determine the terms and conditions of
service for their staff for example salary and hours of work.
 There is no transfer of staff to other organizations except if
they resign.

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 CONT. (SEPARATED PERSONNEL SYSTEM)
ADVANTAGES
It enables local councils to practice full decentralization and
act as a body corporate
It creates greater loyalty to the organization since the staff
cannot be transferred.
It can decide on salary and other terms of service for staff
such as bonus, annual leave, medical benefits.
Local councils can take into consideration local factors
such as lower salary if their staff are from smaller and rural
areas.
DISADVANTAGES
The staff cannot transfer and it can lead to lower morale of
staff
Less promotion prospects for staff since there will be stiff
competition for promotions
There might be lack of training for staff since the councils
have to provide their own training or send them to other
institutions for training
A high turnover of staff especially if prospects for promotion
and transfers not available
There will be a staff shortage in smaller councils
There will be a lack of professional staff such as engineers
especially in smaller councils that cannot afford to pay
them lucratively
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II. INTEGRATED PERSONNEL SYSTEM

 All council staffs are under one central body or commission that is the
Local Government Commission in the same way as we have the
Public Service Commission (JPA) for federal civil servants.

 The local Government Commission decides on terms, salary and

conditions of service for local council staff. It is also responsible for
hiring, firing and discipline of staff.

 It also supervises movement of staff from one council to another.

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 CONT. (INTEGRATED PERSONNEL SYSTEM)
ADVANTAGES
Promotion is more mobile because staff can be promoted
to other councils if there is a vacancy for promotion.
It can produce better conditions of service for staff such as
better salary, allowances and hence encourage more
people to work for a council whether it is a small or big
council.
It can help to provide centralised training for staff such as
INTAN provides training for all government servants
It can help pool talent, expertise and experience of the
staff. Hence those councils that lack professional and
talented staff can be provided with better qualified staff or
the necessary skills.
It can help solve the problem of high turnover of staff
especially in smaller councils
DISADVANTAGES
Staff might form their own trade unions and demand better
pay and prospects from the centralised body.
The centralised body has to subsidize the smaller councils
who might not have the finances to pay higher salaries for
staff.
There might be a problem of maintaining uniformity in
standards among the councils especially in terms of quality
and efficiency of staff.
Local conditions and factors will not be taken into account
especially in hiring of staff.
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 III. FUSION PERSONNEL SYSTEM

 This personnel system has elements of both the integrated and

separated personnel systems.

 Hence local councils can still hire and fire their own staff but for group A
staff, firing of the staff needs approval of the state government.

 Local council staff cannot transfer to other councils. Wages and terms of
conditions of service will be decided by the Federal Service Commission
(JPA)

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 CONT. (FUSION PERSONNEL SYSTEM)
ADVANTAGES DISADVANTAGES
Federal government can help to fill vacancies It reduces full administrative autonomy of councils
especially if councils lack professional staff

Since terms and conditions of service are It does not benefit the bigger councils who have the
standardised, it will benefit smaller councils which financial resources to pay higher wages for their staff
might be able to pay higher wages

It can help to provide adequate training for staff Local councils will be under the control and influence
of federal government

At the same time, councils still maintain their Lack of motivation for staff since they cannot be
administrative autonomy by being able to hire their transferred
own staff 

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 WHAT IS THE
PERSONAL SYSTEM
PRACTICED BY
MALAYSIAN LOCAL
GOVERNMENT?

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 EVALUATE THE PERSONNEL SYSTEM PRACTICED BY
LOCAL GOVERNMENT IN MALAYSIA:

Malaysian LG practiced Fusion system

 Administration autonomy
 Does not allow staff to transfer
 Sense of loyalty

Advantages:
 Allow admin decentralization and enjoy admin autonomy (hiring and firing staff
 Staff enjoying centralized training from INTAN

Disadvantages:
 LG staff treated like the government officer which would not benefit bigger
council but benefits small council
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 METHODS TO IMPROVE LOCAL GOVERNMENT
PERSONNEL SYSTEMS

1. Well planned horizontal integration system

 It is the same as having an integrated local government service or commission
 As in Ireland and Sri Lanka.

 An integrated local government service commission can help by:

a. having common standards of appointment
b. allowing promotions among councils
c. standardising terms and conditions of service
d. setting common standards of performance

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 2.The Vertical Integration system

 This is where central government helps out local councils in areas such as accounting, tax assessment by sending or
seconding their federal staff to councils.

 It can help solve shortage of professional staff in councils. It Increases local competence.

 It promotes more uniform treatment of technical services.

 Saves smaller councils money and manpower that they do not have and it widens career opportunities for such staff

3. Compensation and incentives

 The federal government should give more benefits and allowances and privileges to local council staff than to higher
government staff, for example, local council staff can be given loan preferences, free public transport and
scholarships for their children.

 More training should be provided for council staff in areas such as budgeting, accounting and IT.

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 DIFFERENTIATE BETWEEN THREE (3) PERSONNEL SYSTEMS
THAT HAVE YOU LEARNED

Elements Personnel Systems

Closed/Seperated Integrated Fusion

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END OF CHAPTER 8

THANK YOU

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