Employment Act 1955 · Updated to 1 Aug 2023 · Part XII · Rest Days, Hours of Work, Holidays and Other Conditions of Service
Section 60h
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Interpretation 60i. (1) For the purposes of this Part and Part IX—
“ordinary rate of pay” means wages as defined in section 2, whether calculated by the month, the week, the day, the hour, or by piece rate, or otherwise, which an employee is entitled to receive under the terms of his contract of service for the normal hours of work for one day, but does not include any payment made under an approved incentive payment scheme or any payment for work done on a rest day or on any gazetted public holiday granted by the employer under the contract of service or any day substituted for the gazetted public holiday;
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;
and
“hourly rate of pay” means the ordinary rate of pay divided by the normal hours of work.
Where an employee is employed on a monthly rate of pay, the ordinary rate of pay shall be calculated according to the following formula:
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;
monthly rate of pay
.
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Where an employee is employed on a weekly rate of pay, the ordinary rate of pay shall be calculated according to the following formula:
weekly rate of pay
.
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Where an employee is employed on a daily or an hourly rate of pay or on piece rates, the ordinary rate of pay shall be calculated by dividing the total wages earned by the employee during the preceding wage period (excluding any payment made under an approved incentive payment scheme or for work done on any rest day, any gazetted public holiday granted by the employer under the contract of service or any day substituted for the gazetted public holiday) by the actual number of days the employee had worked during that wage period (excluding any rest day, any gazetted public holiday or any paid holiday substituted for the gazetted public holiday).
wage period
“wage period” means the period in respect of which wages earned by an employee are payable;
For the purposes of payment of sick leave under section 60f, the calculation of the ordinary rate of pay of an employee employed on a daily or an hourly rate of pay or on piece rates under subsection (1c) shall take account only of the basic pay the employee receives or the rate per piece he is paid for work done in a day under the contract of service.
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;
An employer may adopt any method or formula other than the method or formula in subsection (1a), (1b) or (1c) for calculating the ordinary rate of pay of an employee; but the adoption of any other method or formula shall not result in a rate which is less than any of the rates provided in the subsections.
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;
For the purpose of this section, the Director General may, on application made to him in writing by an employer, approve in writing any incentive payment scheme as an approved incentive payment scheme.
Director General
“Director General” means the Director General of Labour appointed under subsection 3(1);
Part XIIa
TERMINATION, LAY-OFF AND RETIREMENT BENEFITS
Termination, lay-off and retirement benefits 60j. (1) The Minister may, by regulations made under this Act, provide for the entitlement of employees to, and for the payment by employers of—
Minister
“Minister” means the Minister charged with the responsibility for human resources;
termination benefits;
lay-off benefits;
retirement benefits.
Without prejudice to the generality of subsection (1), regulations made by virtue of subsection (1) may provide—
for the definition of the expression “termination benefits”,
“lay-off benefits”, or “retirement benefits”, as the case may be, and for the circumstances in which the same shall be payable;
for the application thereof to employees who were in employment under a contract of service immediately before the commencement of such regulations and who continue in such employment after the commencement thereof;
for the application thereof to all employees generally or to any particular class, category or description of employees;
for the exclusion from the application thereof of any particular employee or employees, or any class, category or description of employees;
for the payment of different rates or amounts of termination benefits, lay-off benefits, or retirement benefits, as the case may be, to different classes, categories or descriptions of employees.
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Part XIIb
EMPLOYMENT OF FOREIGN EMPLOYEES
Employment of foreign employee 60k. (1) No employer shall employ a foreign employee unless prior approval has been obtained from the Director General.
An application for the approval under subsection (1) shall be made in the form and manner as may be determined by the
Director General.
Upon approval of the Director General under this section, an employer shall, within fourteen days from the date of the employment of a foreign employee, furnish the Director General with the particulars relating to the foreign employee in such manner as the Director General may direct.
The Director General may, subject to any written law, approve an application under this section if the employer complies with the following conditions:
the employer satisfies the Director General that on the date on which he makes the application—
he has no outstanding matter relating to any decision, order or directive issued under this
Act; or
he has no outstanding matter or case relating to any conviction for any offence under this
Act, the Employees’ Social Security Act 1969, the Employees’ Minimum Standards of Housing,
Accommodations and Amenities Act 1990
[Act 446] or the National Wages Consultative
Council Act 2011 [Act 732]; or
the employer has not been convicted of any offence under any written law in relation to anti-trafficking in persons and forced labour.
An employer who contravenes subsection (1) commits an offence and shall, on conviction, be liable to a fine not exceeding one hundred thousand ringgit or to imprisonment for a term not exceeding five years or to both.
Termination of employment of foreign employee, etc.
60ka. (1) If the service of a foreign employee is terminated—
by his employer;
by reason of the expiry of the employment pass issued by the Immigration Department of Malaysia to the foreign employee; or
by reason of the repatriation or deportation of the foreign employee, the employer shall, within thirty days of the termination of service, inform the Director General of the termination in the manner as may be determined by the Director General.
If a foreign employee terminates his service or absconds from his place of employment, the employer shall, within fourteen days of the termination of service or after the foreign employee’s absence, inform the Director General in the manner as may be determined by the Director General.
place of employment
“place of employment” means any place where work is carried on for an employer by an employee;