Employment Act 1955 · Updated to 1 Aug 2023 · Part V · System of Payment of Wages
25. Wages to be paid through financial institution
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All wages earned by an employee, less lawful deductions, must be paid into an account at a financial institution. The account must be in the employee's name, or held jointly with other people as the employee chooses.
Summary · Drafted with AI, checked against the official text on 30 Sep 2026.
The entire amount of wages earned by, or payable to, any employee in respect of any work done by him less any lawful deductions, shall be actually paid to him through payment into an account opened by a financial institution, being an account in the name of the employee or an account in the name of the employee jointly with one or more other persons as stipulated by the employee.
wages
“wages” means basic wages and all other payments in cash payable to an employee for work done in respect of his contract of service but does not include— (a) the value of any house accommodation or the supply of any food, fuel, light or water or medical attendance, or of any approved amenity or approved service; (b) any contribution paid by the employer on his own account to any pension fund, provident fund, superannuation scheme, retrenchment, termination, lay-off or retirement scheme, thrift scheme or any other fund or scheme established for the benefit or welfare of the employee; (c) any travelling allowance or the value of any traveling concession; (d) any sum payable to the employee to defray special expenses entailed on him by the nature of his employment; (e) any gratuity payable on discharge or retirement; or (f) any annual bonus or any part of any annual bonus;
Every employee shall be entitled to recover in the courts so much of his wages, exclusive of sums lawfully deducted under
employee
“employee” means any person or class of persons— (a) included in any category in the First Schedule to the extent specified therein; or (b) in respect of whom the Minister makes an order under subsection (3) or section 2a;
Part IV, as shall not have been actually paid to him in accordance with subsection (1).
For the purposes of this Part, “financial institution includes—
a licensed bank and an approved issuer of a designated payment instrument under the Financial Services
Act 2013 [Act 758];
a licensed Islamic bank and an approved issuer of a designated Islamic payment instrument under the Islamic
Financial Services Act 2013 [Act 759]; and
a prescribed institution under the Development Financial
Institutions Act 2002 [Act 618].
Employment 35
The Minister may, by order, specify any approved issuer of a designated payment instrument or any approved issuer of a designated Islamic payment instrument under paragraphs 3(a) and
Minister
“Minister” means the Minister charged with the responsibility for human resources;
to be a recognized approved issuer of a designated payment instrument or approved issuer of a designated Islamic payment instrument for the purpose of payment of wages under this Part.
Payment of wages other than through financial institution 25a. (1) Notwithstanding subsection 25(1), an employer may, upon a written request of the employee, and subject to subsection (2), make payment of his employee’s wages—
in legal tender; or
by cheque made payable to or to the order of the employee.
The employer shall, upon the written request of his employee under subsection (1), obtain approval from the Director General for the payment of wages to be paid in legal tender or by cheque.
employer
“employer” means any person who has entered into a contract of service to employ any other person as an employee and includes the agent, manager or factor of such first mentioned person, and the word “employ”, with its grammatical variations and cognate expressions, shall be construed accordingly;
The Director General may impose any condition as he may deem fit on the approval granted under subsection (2).
Director General
“Director General” means the Director General of Labour appointed under subsection 3(1);
The request by the employee under subsection (1) may be withdrawn by the employee at any time, by notice in writing, to the employer.
The notice referred to in subsection (3) shall take effect at, but not before, the end of the period of four weeks beginning with the day on which the notice is given.
day
“day” means— (a) a continuous period of twenty-four hours beginning at midnight; or (b) for the purposes of Part XII in respect of an employee engaged in shift work or in work where the normal hours of work extend beyond midnight, a continuous period of twenty-four hours beginning at any point of time;
The request of the employee to the mode of payment of wages under subsection (1) shall not be unreasonably withheld by the employer upon obtaining the approval under subsection (2).
Any dispute arising out of the request by the employee under subsection (1) shall be referred to the Director General whose decision on the matter shall be final.
Section 69 shall not apply in respect of any dispute under subsection (6).