Malaysia

Updated:

Employment

A contract of service is typically the employment contract.

Payroll

Salaries are paid monthly for work between the first and last day of the month. Paydays are decided between the employee and employer, but are typically at the end of the month.

HR & Labor

Working Hours: Full time employment is considered 48 hours a week. Overtime is paid at 150% of regular wages on a normal working day. Employees receive 200% of regular wages on a rest day and 300% on public holidays.
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Minimum Working Age: Children under 14 are only allowed to work at a family business. From the ages of 14-16, workers are allowed to do light work that doesn’t involve heavy machinery. They can work a maximum of 7 hours from 8am-6pm.

Immigration

There are 3 types of work permits in Malaysia. Professional Visit Pass, Employment Pass and Temporary Employment. These passes are usually from 6 months to 5 years. Employees must receive their work permit prior to entering the country.

Minimum Wage

The minimum wage is RM900.

Public Holidays

August 7: Raksha Bandhan (Hindu Holiday)
August 14: Janmashtami (Hindu Holiday)
August 25: Ganesh Chaturthi (Hindu Holiday)
August 31: Malaysia's National Day
September 1: Hari Raya Haji
September 9: Agong's (Malaysian King) Birthday
September 11: Replacement of Agong's Birthday
September 16: Malaysia Day
September 18: Replacement of Malasia Day
September 21: Navaratri (Hindu Holiday)
September 22: Muharram/New Year
September 30: Dussehra (Hindu Holiday)
October 18: Diwali/Deepavali
December 1: The Prophet Muhammad's Birthday
December 11: Sulatan of Selangor's Birthday
December 25: Christmas Day

January 1: New Years Day (Bank Holiday)
January 31: Thaipusam (Bank Holiday)
February 1: Federal Territory Day (Bank Holiday)
February 14: Maha Shivaratri (Hindu Holiday)
February 16-17: Chinese New Year
March 2: Holi (Hindu Holiday)
March 30: Good Friday
April 1: Easter Sunday
April 13: Isra and Mi'raj
May 1: Labor Day
May 16: Ramadan Begins
May 30-31: Harvest Festival
June 15-16: Hari Raya Puasa
July 28: The Yang di-Pertuan Agong's Birthday
August 22: Hari Raya Haji
August 26: Raksha Bandhan (Hindu Holiday)
August 31: Malaysia's National Day
September 2: Janmashtami (Hindu Holiday)
September 12: Muharram/New Year
September 13: Ganesh Chaturthi (Hindu Holiday)
September 16: Malaysia Day
October 10: Navaratri (Hindu Holiday)
October 19: Dussehra (Hindu Holiday)
November 7: Diwali/Deepavali
November 21: The Prophet Muhammad's Birthday
December 25: Christmas Day

Pension Fund

Employers contribute 12% of employees wages.

Employee contribute 11% of their wages.

Severance Payments

* 1-2 years of employment receives 10 days wage for every year of employment.
* 2-5 years of employment receives 15 days wages for every year of employment.
* 5+ years of employment receives 20 days wage for every year of employment.

Advance Notice

Advance notice is one month.

Termination Procedure

Employers must provide:
* Four weeks notice for employees of up to two years.
* Six weeks notice for employees of two to five years.
* Eight weeks notices for employees of five or more years.

Sick Days

* 0-2 years of employment entitles employees to 14 days of sick leave.
* 2-5 years of employment entitles employees to 18 days of sick leave.
* 5+years of employment entitles employees to 22 days of sick leave.

Employees who have been hospitalized are entitled to 60 days of sick leave.

Vacation Days

If the employee has been with the company less than 2 years, they get 8 vacation days. If they have been in the company over two year but less than five years, they get 12 days and 16 days for over five years in the company.

Expat Benefits

Malaysian companies often offer expat benefits such as relocation costs, housing assistance, mobility cost assistance and education fees. The packages vary from company to company.

Additional Employee Withholdings

1) Disability Benefits

1) Employer contributes 1.75%.

1) Employees contribute 0.5%.

VAT

The VAT is 6% standard rate.