UNDERSTANDING

EMPLOYMENT ACT 1955 & REGULATIONS

BY
Shafwan Datuk Hj. Shamsuddin
Senior Industrial Relations Adviser
 EMPLOYMENT ACT 1955

•An Act relating to EMPLOYMENT

•Provide minimum standards of
employment for certain categories
of employees

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 ARRANGEMENT OF SECTIONS
• Part 1 : Preliminary
• Part 2 : Contracts of Service
• Part 3 : Payment of Wages
• Part 4 : Deductions From Wages
• Part 5 : System of Payment of Wages
• Part 6 : Priority of Wages
• Part 7 : Contractors, Principals and
Contractors for Labour
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Part 8 : Employment Of Women
Part 9 : Maternity Protection
Part 10 : Employment of Children and Young
Persons (Repealed)
Part 11 : Domestic Servants
Part 12 : Rest Days, Hours of Work, Holidays
And Other
Conditions Of Service
Part 12A : Termination, Lay-Off and Retirement
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Benefits
• Part 12B : Employment of Foreign Employees
• Part 13 : Registers, Returns And
Notice Boards
• Part 14 : Inspection
• Part 15 : Complaints And Inquiries
• Part 15A : Sexual Harassment
• Part 16 : Procedure
• Part 17 : Offences And Penalties
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• Part 18 : Regulations
• Part 19 : Repeal And Saving

FIRST SECOND
SCHEDULE SCHEDULE

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 REGULATIONS
1. Employment Regulations 1957

2. Employment (Employment of Women) (Female Conductors)

Regulations 1958

3. Employment (Employment of Women) (Shift Workers)

Regulations 1970

4. Employment (Minimum Rate of Maternity Allowance)

Regulations 1976

5. Employment (Termination and Lay-off Benefits) Regulations 1980

6. Employment (Limitation of Overtime Work) Regulations 1980

7. Employment (Part-Time Employees) Regulations 2010

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 PART I
INTERPRETATION

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 First
“EMPLOYEE” Schedul
e
1. Wages not exceeding RM2,000 per month (does not include
commission, subsistence allowance and overtime)

2. Manual Labour irrespective of wages earned

3. Operating Mechanically Propelled Vehicles

4. Supervising Manual Labour in and throughout the performance

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Casual Employees

“A worker who is engaged on a day to day basis, whenever there is a need

for his services is a casual worker in the proper use of the term. Such worker

has no implied or expressed continuity of employment beyond the day on

which he is engaged. He may turn up for work hoping to get work everyday

but has no guarantee that he will be offered work continuously. If the supply

of such labour is plentiful, it is quit likely that he may be denied work for a

number of days. On the other hand if the supply is small, or he is a

particularly suitable worker he may work continuously on a day to day basis

for a period of 6 or 7 weeks or in extreme cases even longer.”

WAGES DEFINITION UNDER THE ACT?

BASIC PAYMENT FOR

PLUS
WAGES WORK DONE

EXCLUDING
1. Value – house accommodation, food,
water, fuel, medical etc
2. Any Contribution Paid by Employer
3. Travelling Allowance
4. Payment to defray Special Expenses
5. Gratuity
6. Annual Bonus 11
WEEK = Continuous period of SEVEN days

DAY
Continuous 24 hours Continuous 24 hours
beginning at midnight beginning at any point
in time (shift workers)

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PART II
CONTRACTS OF
SERVICE

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Contract OF Service
Any agreement whether oral
or in writing and whether
express and implied,
whereby one person agreed
to employ another as an
employee and that other
agrees to serve his employer
as an employee and includes
an apprenticeship contract.
vs. Contract FOR Service
A contract between
principal and contractor
to carry out the whole or
any part of any work
undertaken by the
principal in the course of
or for the purposes of
the principal’s trade or
business.
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 Contract for Service

“A contractual arrangement by which one person agrees to

provide workplace services to another.”
Dr. Peter E. Nygh and Peter Butt ,
Butterworths Concise Legal Dictionary

“A Contract for Service is an agreement whereby a person is engaged as an

independent contractor, such as a self-employed person, vendor or
freelancer carrying out an assignment or a project for his establishment. For
example, a house owner engages services of a painter, a plumber or a grass-
cutter for his residence.”
www.minimumwages.mohr.gov.my
INTERN?
 SECTION 7

TERMS AND CONDITIONS =

Less favourable Void and

terms no effect

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 SECTION 8

Contract of Service CANNOT:

* Restrict employees from joining Union
* Restrict employees from participating in
Union Activities
* Restrict employees from organizing
Union

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SECTION 10
CONTRACT OF
SERVICE MUST Be in
writing
Include provision for
termination
SECTION 12
TERMINATION OF CONTRACT OF SERVICE
4 Weeks = < 2 Years
6 Weeks = > 2 Years < 5 Years
8 Weeks = > 5 Years & Above
**NOTICE MUST BE IN WRITING**
SECTION 11
FIXED TERM CONTRACT =
Terminates when period of time
has expired, or
Work specified has been
completed.
Termination of Service of
Employee for reasons:
1. Employer has ceased business
2. Employer has ceased business at a
Contracted Workplace
3. Requirement for work has ceased
(Redundancy)
4. Redundancy at a Contracted Workplace
5. Refusal of Transfer by employee (unless
there is transfer clause)
6. Change In Ownership of Business
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SECTION 13

Termination without SECTION 14

notice:
Misconduct
▪ Indemnity in lieu of
notice
Due Inquiry
▪ Wilful breach by other
party

Punishment

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