Understanding Malaysian Labour Law

If you have staff or employees, this is a good resource. It gives you all you want to know about employment issues, leave entitlement – everything you need to know as an employer and business owner about hiring and firing employees.


UPDATE: As we at WomenBizSENSE have received a lot of comments asking for help particularly from employees, please contact Jabatan Tenaga Kerja Semenanjung Malaysia (under Kementerian Sumber Manusia) at: http://jtksm.mohr.gov.my

For Penang, you can contact:

JTK Negeri Pulau Pinang
Tingkat 2, Bangunan Tuanku Syed Putra,
10300 Pulau Pinang
Telefon: 04-2613123 / 2625536
Telekerja: 04-2639111
Faksimili: 04-2638605
E-Mel: jtknppinang@mohr.gov.my

15 replies
  1. neela
    neela says:

    can u let me know what is the labour law code – ( seksyen )
    1- if make transfer employee to another department in same company
    2 – transfer employee to another branch / company
    3- untuk tahun 2011 cuti tahunan berapa hari, dan pekerja yang kerja lebih 5 tahun ada cuti tambahan atau masih kekal 16hari ?

    terima kasih

    • krista
      krista says:

      Hi Neela – Below are the answers from our HR expert, Muzlifah who used to work with MNCs in the Bayan Lepas area.

      Question 1- if make transfer employee to another department in same company

      Answer: yes, the company can transfer the employee to another dept as long as it is to another reasonable job, and at the same pay and benefits that she is currently enjoying. If there is no similar position, at least to one that is almost equivalent. The reasons for transfer must be satisfactory eg the current position is redundant, or the company is downsizing etc. And not due to personal reasons like the manager not liking the employee.

      Question 2 – transfer employee to another branch / company:

      Ans: This is also possible if due to business reasons, eg reduction in business, or expansion and the current position is not needed, or abolished. The company cannot transfer the employee and subsequently hire another employee to her former position.

      Question 3- untuk tahun 2011 cuti tahunan berapa hari, dan pekerja yang kerja lebih 5 tahun ada cuti tambahan atau masih kekal 16hari ?

      Ans: the number of days annual leave provided by the company should not be less than that provided as minimum requirement by the Labor Law which is :

      Less than 2 years’ service : 8 days
      More than 2 years but less than 5 years : 12 days
      5 years or more service : 16 days.

      It does not depend on the calendar year eg 2011 or 2012. It is per the offer Letter for as long as the company does not decide to increase the benefits given.

      Some companies provide more than the minimum above, and in such situations, it is because the company wants to be more competitive than the other companies in the market. So, there is no “cuti tambahan” unless the company makes a policy decision to increase the number of days given to employees whose service is 5 years or more.

      • Choo Yuet May
        Choo Yuet May says:

        If let say transfer from Production to Quality Assurance department?
        As far as I am concern this 2 department are not similar at all.

        Please advise.


  2. carrie
    carrie says:

    my fiancee is an expactriate and we work in an international school. He was issued a letter today stating that his visa will not be continued and that he was given early dismissal, This is his first time for renewal. Before he got the visa he was working with the school for six months with no visa but being paid cash. The principal of the school did not want to give any explanation for the dismissal. Can this be done? Do we have any rights?

  3. klchen
    klchen says:

    a unconfirmed employee goes for 2 days leave with a medical certificate from a registered MD……can the employer deduct his pay?

    • krista
      krista says:

      Hi klchen: We are sorry that we cannot answer your question as we are NOT a HR company nor do we have full-time HR experts in our group. We are just providing a link to the article on Malaysian Labour Law. Please refer to the necessary authorities or HR experts. Thanks!

  4. Fo Shan Shan
    Fo Shan Shan says:

    I have been the MD and 30% shareholder of my company for the past 15 years and continued to work without any stoppage past my retirement age and am still working now. My monthly remuneration is based on 10% of the collections of the company and because billings have been increasing over the years my income is substantial.

    The 70% shareholder (chairman) enjoys exactly the same benefit in addition to dividends based on his 70% shareholding eventhough he does not work in the company.

    My appointment letter did not mention anything about mandatory retirement age. It only mentioned that I should be actively working in the company and should I wanted to sell my shares the first right of refusal must be given to the chairman and the value of the shares shall be determined by a firm of Chartered Accountants. (Btw the chairman is past 70 years old and is still receiving his monthly income from the company as if he is working there)

    Recently the chairman suggested that I retire. I would like to pose the following questions:-

    1. Since there was no mention of of retirement age in my appointment letter and I have been working continuously past my legal retirement age of 55, is my case equivalent to termination or retrenchment meaning that I shall be entitled to the usual compensation?

    2. Since I do not want to retire, meaning that I am still actively working, will my forced retirement trigger the sale of my shares to the Chairman based on first right of refusal and valuation by accountants as stated in the appointment letter or in my particular case can I take the position that the suggested mode of valuing my share need not apply and that the final sale consideration shall be based on a willing seller willing buyer basis.

    Hence will I be correct to assume that I may be compensated in 2 ways:-
    1) for forced retirement;
    2) proceeds from sale of my shares on a willing buyer willing seller basis and if price is not agreeable I need not sell?

    Your opinion will be much appreciated.

    Shan Shan

    • krista
      krista says:

      Hi Shan Shan: We are sorry that we cannot answer your question as we are NOT a HR company nor do we have full-time HR experts in our group. We are just providing a link to the article on Malaysian Labour Law. Please refer to the necessary authorities or HR experts. Thank you.

  5. Jeyanthi Sandragason
    Jeyanthi Sandragason says:

    Hi, I have been with this firm in Penang for 1 1/2 yrs and they want to transfer only me to our BM branch which rejected. Can they terminate my service? I dont think this is reasonable at all…

    • krista
      krista says:

      Hi Jeyanthi,

      We would like to help you but it is best you refer to the Labour Dept for your matter. We are not HR experts and do not wish to give you a wrong perspective on this matter. Please go to the Malaysian Labour Dept and ask them. Here is their website: http://jtksm.mohr.gov.my/

  6. Elaine
    Elaine says:

    Good evening,

    l have an question, l had get a job from a chinese base factory & sign for the offer letter ,and the commencement date is on 2/9/2014, but now l wish to reject the offer after l go to servay the distance from my home to factory, and find that is in a very serious traffic jam situation,if l dediced to work l need to go out very early to avoid traffic jam every day.

    Long-term effect,l’m affraid my physical and mental unsupported, and will give up at the end, so before turn to work, l decided to reject the offer that they give to me, l did call the factory, and told them the reason, they ask me tried to consider, l said, if l insist to reject,they said, they also can’t do anything, but l ask, would they sue me if l didn’t turn up on 2/9/2014, the answer they give me is “we also hope do not come to this way,” what they means, can they ready sue me if l insist not turn up, and l also get a job just near my house, but l’m so worry if they take legal action on me, than how. please help me ,is urgent. thank you very much.

    • krista
      krista says:

      Hi Elaine, thanks for your comment. We are unable to help you answer your question as we are not HR experts. We’ve emailed you privately some suggestions and ideas. Please check your email.

  7. Samantha Loh
    Samantha Loh says:

    Hi Ms Krista,

    I’m a employer of the company. I had 1 staff who only work for 1.5 months took 2 days emergency leave when he started work for his 1 week of duty after that from Jan 2016 until now he already took 5 days MC but 1 of the MC slip he told me lost. I went to clinic kesihatan Tg Bungah to check unfortunately the Pengawai told he he don’t have any MC on the particular date and he also never consult Dr. on the same. He still under probation, can I terminate him 48hr?

    Tks in advance and hope to hear your advice very soon.

    Best regards,

  8. Quynh Nhu
    Quynh Nhu says:

    Hi, Ms Krista
    I have a question. I’m a foreigner and I want to work in Malaysia so what I have to do. Do I need a work permit? how to get it? and which conditions I have?

    Thanks in advance and hope to hear your advice very soon
    Best regards,


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