2/19/2020 5 Things You Should Know About Probationers in Malaysia | Donovan & Ho

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5 Things You Should Know About Probationers

in Malaysia
by Donovan & Ho | Aug 12, 2015 | Employment Law

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When hiring new employees, employers will usually put them on a “probation”. The purpose of the
probationary period is to allow employers to assess whether the new employee is suitable for the role
and whether they will be a good t for the company. The probationary period is meant to provide
employers with su cient time to evaluate and review their new employees’ performance before
con rming them as permanent staff. Although going through a probationary period is fairly common,
there are many things about probationers which are frequently misunderstood by employees and
employers alike. Here are 5 important things you should know about probationers in Malaysia.

#1 : The term ‘probationer’ is not de ned in the Employment Act 1955 or in the
Industrial Relations Act 1967.

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There is no statutory de nition of what is a “probationer”. However, case law does distinguish between
a con rmed employee and a probationer. Broadly speaking, a probationer is a new employee who is
going through a ‘trial’ period in an employment to prove his/her tness for the position which was
offered by the employer.

There is no legal requirement to put an employee on probation before they are hired, although this is
recommended as a best practice. There is also no legal “minimum” or “maximum” probationary period
that needs to be imposed although a probationary period in the range of 3 – 6 months is common.

#2: A probationer enjoys the same rights as a con rmed employee. Therefore,
a probationer’s service must not be terminated without just cause or excuse.
Like a con rmed employee, a probationer has a right to make a representation to the Director-General
for Industrial Relations under Section 20 of the Industrial Relations Act 1967 for unfair dismissal if they
feel they have been unfairly dismissed. The difference between a probationer and a permanent staff is
in the remedy.   If the Court nds that his/her service is terminated without just and cause, the
probationer is entitled to compensation in lieu of reinstatement of a maximum of 12 months’
backwages based on the last drawn salary. (Con rmed staff are entitled to a maximum of 24 months’
backwages).

While termination of a probationer must be with “just cause or excuse”, the law recognises that the
standard of proof required of the employer is lower when it comes to probationers. This is because
employers have a general  prerogative to choose and organise their workforce however they see t,
subject to compliance with labour laws of course.

#3: A probationer continues to be a probationer even at the expiration of the

probationary period, if at the end of the period, his/her services had either not
been terminated or con rmed.
A surprising number of people actually spend years working for the same company without ever
receiving a con rmation letter. These employees assume they have been “automatically” con rmed
since their probation period was completed without any comments from the employer. This is actually a
misconception as the law provides that a probationer remains on probation until he receives notice that
he has been terminated or con rmed.   However, con rmation can be implied by conduct,   if the
employer treats the probationer as a permanent staff (For example, giving him the same bene ts that
would be received by a permanent staff).  The importance of a con rmation letter should therefore not
be underestimated.

It is good practice for employers to monitor their employees’ probationary periods. At the end of the
probationary period, employers should notify the employee whether they have been con rmed,
terminated, or if their probationary period is being extended.

#4: The employer has full rights to assess a probationer’s character, suitability
and capacity as an employee during the probationary period. If the probationer
is found to be unsuitable, the employer can terminate his/her probation in
accordance with the terms of the employment contract.
Suitability of a probationer is not just based on work performance but also his/her conduct, behaviour
and attitudes in relation to the position he/her is employed. With regard to work performance, the
probationer is assessed in 3 broad aspects: – (1) Ine ciency; (2) Incompetence and (3) Ineptitude.
(Samsuddin Mat Amin v. Austral Enterprises Berhad [Award No. 47 of 1974])

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In a nutshell, the test is  “whether the probationer possesses the right skill, competence, temperament,
aptitude, attitude and suitability which will entitle him to transcend from being a probationer to that of a
con rmed permanent employee.” (Indra Devi Rajoo v. Everhome Furniture MFR (M) Sdn Bhd [2015] 2 LNS
0093)

#5: Generally, in order to terminate a probationer’s employment based on poor

performance, it is good practice that the employer follows the following steps:-
Warn the probationer about his poor performance in a form of a proper evaluation/appraisal.
Evaluations and appraisals should be documented and signed off by the probationer.
Give su cient opportunity to the probationer to improve on his/her work performance such as
communicating speci c goals and tasks to be achieved by the probationer in a reasonable
timeframe, setting out areas of improvement, etc.
Provide su cient guidance and advice during probation period.
Consider extending the probationary period as an alternative to termination, if you believe that there
is still potential for the employee to improve.

If the probationer still fails to improve his/her performance after such steps have been taken by the
employer, the Court would more likely to determine that the termination was with just cause and excuse.

***

About the author: Joanne Ong is an associate in the dispute resolution practice group of  Donovan & Ho.
 She graduated with a LLB (Hons) from the University of Manchester and is an advocate and solicitor of
the High Court of Malaya. She has worked worked on a wide range of dispute matters involving unfair
dismissal claims, debt recovery, conspiracy, fraud, land, bankruptcy, insolvency and defamation. Have a
question? Contact us.

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