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Q&A on Employment Law in Malaysia

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Q: Who falls under the coverage of the Employment Act 1955?
A: The Employment Act 1955 covers all employees in Peninsular Malaysia and Labuan irrespective of their wages. However, employees earning monthly salary of more than RM4,000 are exempted from certain provisions such as those related to overtime, allowance for shift-based work, termination and retirement benefits.

Q: What are the standard working hours according to the Employment Act 1955?
A: According to the Employment Act 1955, the maximum working hours are 8 hours a day and 45 hours a week. Employees are entitled to a rest day after every 6 consecutive working days, and if they work on a rest day, they are entitled to overtime pay.

Q: What are an employee's leave entitlements under the Employment Act 1955?
A: Employees covered by the Employment Act 1955 are entitled to various types of leave, which include:
1. Annual leave:

(1) 8 days for employees with less than 2 years of service.

(2) 12 days for employees with 2 to 5 years of service.

(3) 16 days for employees with more than 5 years of service.
2. Sick leave:

(1)
14 days per year for employees who have been employed for less than 2 years.

(2)
18 days for employees with 2 to 5 years of service.

(3)
22 days for employees with more than 5 years of service.
3. Maternity leave:

Female employees are entitled to 98 days of continuous paid maternity leave for each confinement.
4. Paternity leave:

Male employees are entitled to 7 consecutive days of paid maternity leave in respect of each confinement.
5. Public holiday:

Employees are entitled to 11 paid public holidays within a calendar year, with 5 of these holidays being specified as follows:

(1) National Day;

(2) Malaysia Day;

(3) Birthday of the Yang di-Pertuan Agong;

(4) Birthday of the Ruler or the Yang di-Pertua Negeri of the state (Head of State) where the employee works, or Federal Territory Day if the employee works in the Federal Territory; and

(5) Worker’s Day.

Q: What are the valid grounds for termination of employment?
A: Under the Employment Act 1955 in Malaysia, there are several valid grounds for the termination of employment. These can be broadly classified into dismissal for misconduct, dismissal for poor performance, retrenchment, and other lawful reasons.

For a dismissal to be lawful, there must be clear and significant grounds for the decision, coupled with the observance of a fair procedure. A critical step in justifying a dismissal for misconduct is conducting a "due inquiry" or "domestic inquiry," which ensures that the employee has the opportunity to present their side of the matter.

Q: Is flexible working arrangement permissible under the Employment Act 1955?
A: Yes, employees have the right to submit a written request to their employer for flexible working arrangements, which may include changes to working hours, days, or location. Employers are required to reply in writing within 60 days of receiving the request. In the event of a denial, the employer is required to give the employee a thorough explanation.

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