The Employment Act 1955 has been subjected to amendments that will introduce major changes to the operations of the workforce in the country through the Employment (Amendment) Act 2022 that was gazetted on 10.5.2022.
Amongst the key changes
Maternity leave – increased to 98 days from 60 days. A pregnant employee may not be terminated except on grounds of wilful breach of the conditions of service, misconduct or if the employer is no longer in business.
Paternity leave – husbands will be entitled to 7 days of paid leave for every birth beginning from the day of the birth, regardless of the number of spouses and up to 5 births.
Sexual harassment notice – employers to display a prominent notice at workplace to educate employees about sexual harassment at workplace.
Reduced maximum weekly working hours – the maximum working hours in a week is reduced to 45 hours from 48. Working hours in excess of the 45 hours will be subject to overtime rates.
Sick leave and hospitalization leave – the total sick leaves available to an employee is now treated as distinct and separate from the 60 days hospitalization leave.
Flexible working arrangement – employees may apply for flexible work arrangements that may include change in the work schedule, working days or work location. Employers may approve or reject the application and if rejected, written reasons must be given.
Apprenticeship contract – the duration of such contract is limited to 24 months with minimum duration of 6 months. Currently, such contract is defined for a period not less than 2 years.
Enforcement of the amendments
By way of gazette notification, the Minister of Human Resources has appointed 1.9.2022 as the date on which the amendments to the Act will take effect. On 15.8.2022, the Employment (Amendment of First Schedule) Order 2022 that sets out the scope of application of the changes to the Employment Act 1955 was gazetted with the changes set to come into force also on 1.9.2022.
Currently, the provisions of the Employment Act 1955 applies only to employees with monthly earnings of RM2,000 and below unless otherwise stated in the Act and to certain classes of employees as listed in paragraph 2 of the 1st Schedule to the Act regardless of their monthly earnings. For employees outside the scope of the Act, they will be bound by the terms as agreed in their contract of employment with the employer.
Following the Order that was gazetted on 15.8.2022, the Act now applies to all employees. This because the definition of “employee” has been amended to any person who has entered into a contract of service. There is no longer any limit to the application of the Act. The minimum standard of employment guaranteed under the Act will apply to all employees, as opposed to only those earning less than RM2,000 currently.
The Order however has set out some limit on application of the benefits under the amended Act. Employees earning more than RM4,000 a month are excluded from the statutory benefits under sec. 60(3), 60A(3), 60C(2A), 60D(3), 60D(4) and 60J that covers overtime payment for extra hours or for working on rest days or public holidays or to the termination, lay-off and retirement benefits. In general, those earning more than RM4,000 a month will not be entitled to these benefits.
Messrs R. Jayabalan
