Employment Act – Key Amendments

Employment Act – Key Amendments

Changes to Employment Act

Does EA apply to me?

In the past, the Employment Act was only applicable to employees earning a maximum of RM2,000 per month. However, the updated Act now covers all employees, regardless of their wages with the exception that certain specific sections will not be applicable to employees earning more than RM4,000 per month.

What are the key changes I need to know?

1. Flexi Working Hours

To accommodate post-pandemic work trends, the Act has been amended to include provisions for flexible working arrangements. Employees can now apply in writing for flexible work arrangements, and employers must respond within 60 days, providing reasons for rejection if applicable.

2. Reduction in Maximum Working Hours

In line with the International Labour Organisation (ILO) Convention, the maximum weekly working hours have been reduced from 48 hours to 45 hours, excluding meal breaks. This change aims to prioritize the welfare of workers in Malaysia.

3. Extended paid maternity leave

The amended Act increases the paid maternity leave for working mothers from 60 days to 98 days, providing additional time for post-delivery recovery.

4. Introduction of paid paternity leave

For the first time in Malaysian employment law, the 2022 amendment introduces paid paternity leave. Working fathers are now entitled to seven consecutive days of paid leave under Subsection 60FA. Certain conditions apply, including marriage to the child’s mother, continuous employment for at least 12 months, and notifying the employer 30 days before the expected confinement.

5. Enhanced protection for pregnant employees

Starting from January 1, 2023, the amended Act offers increased protection for pregnant employees and those suffering from pregnancy-related illnesses. Employers are now prohibited from terminating or issuing termination notices to these employees, except in cases of contract breach, misconduct, or business closure.

6. Promoting awareness of sexual harassment

Section 81H of the amended Act requires employers to display a notice on workplace sexual harassment awareness in a conspicuous location, aiming to promote a safe work environment.

7. Inclusion of gig workers

The updated Act includes a new section on the presumption of employment, even without a written contract. This change offers protection to gig workers, such as delivery partners and on-demand drivers, who now fall under the Employment Act 1955.

8. Calculating wages for incomplete month’s work

The amendments add a new Section 18A, which introduces a formula for calculating wages when an employee has not worked a full month. This clarification resolves a common administrative issue for HR and payroll departments.

9. Addressing employment discrimination disputes

The new Section 69F grants the Director General the authority to inquire into and decide on disputes between employees and employers regarding employment discrimination. Non-compliance with the Director General’s orders constitutes an offense. However, the provisions lack clarity on the types of discrimination covered and the potential orders the Director General may issue.

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