Whether you are a native job seeker living in Malaysia or an overseas applicant looking for work in this beautiful country, it is always a good idea to have a clear understanding as to rules and regulations concerning your employment in South East Asia. Are you allowed sick pay? Can you take maternity leave? Are there restrictions on the number of hours you can work per day? Does this include overtime? If you are an employer in Malaysia, do you need to put specific structures in place?
When you understand the laws which facilitate the employer-employee contract you can really determine whether the benefits a post offers are acceptable in comparison to others on the market. You can also check whether your employer is offering all that they should in legal terms. From an employer’s point of view, this article acts as a brief summary and a checklist of the fundamental factors you need to have in place.
The current laws in Malaysia all derive from the Employment Act of 1955. This act covers workers earning less than RM2000.00 per month and working within a role such as artisan, apprentice, transport operator and supervisor. Subsequent acts as discussed below added further regulations.
The working day in Malaysia
In Malaysia you are not allowed to work more than 8 hours a day or 48 hours a week. An employer encouraging this behaviour could be severely penalised. Overtime is available depending on your role and contract, but any extra hours would have to come within the restrictions stated above.
Leave and maternity leave
Paid leave is recognised as in most western countries such as the UK. However, it could be said that it is not so generous. It is structured on a sliding scale as follows:
• Less than 2 years’ service: 8 days leave
• 2 or more years but less than 5 years’ service: 12 days leave
• More than 5 years’ service: 16 days leave
On top of this, there would be the 11 public holidays which are mandatory. They include National Day, Birthday of the Yang Dippertuan Agong, Federal Territory Day, Labour Day and Malaysia Day. These are the minimum number of days a business can offer its employees. Clearly when you factor in competition between organisations within the same industry – and the fact that larger companies will be able to attract quality applicants by offering a more robust leave package, this area within the employment contract is likely to be on the negotiating table.
Women are allowed 60 days paid maternity leave.
Sick leave is also calculated by taking into consideration the employees years of service. For instance:
• Less than 2 years of service: 14 days paid sick leave
• More than 2 years but less than 5 years’ service: 18 days paid sick leave
• More than 5 years’ service: 22 days paid sick leave
• Where hospitalisation is required: Up to 60 days paid leave
In 2012 the retirement age changed in Malaysia. The New minimum Retirement Age act rose from 55 to 60 for civil servants and private sector employees. This act of course does not prevent early retirement if the contract between employee and employer allows for it. However, if an employer was to require an employee to retire before the age of 60 this will result in a hefty financial penalty for the organisation.
Safety at work in Malaysia
How are you protected as far as health and safety is concerned? In 1994 an act was put in place to provide the legislative framework to secure the safety, health and welfare among the whole of the Malaysian workforce. This protects workers against risks to health and safety while carrying out activities at work. The employer has a responsibility to maintain plant systems and equipment so that they are safe and not a risk to health. The employer must also provide supervision and training as well as necessary safety equipment. As well as creating a health and safety policy the employer must revise it on a regular basis.
Under the Workman’s Compensation Act 1952 (i.e. if an employee were to have an accident in the workplace) the employer is legally required to inform the Department of Labour about any work-related accident or illness. Failure to do so could result in heavy fines. The worker must also report the accident within 7 days, but it should be noted that the 1952 act only covers foreign workers. In order to cover the possibility of accidents employer are encouraged to take out employer’s liability insurance.
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