Assigment – Employment Act 1955.

In Malaysia, the relationship between employers and employees governed by labour laws. Development of labour laws in Malaysia began when many Chinese and Indian labourers brought in to Malaya to work in tin mines and rubber plantations. Growth and rapid development of mines and rubber plantations in Malaya increased from time to time, and the amount of labour has also increased. Chinese and Indian labourers brought in by the English which is the mining operators and rubber plantations through agents.

At the beginning is, Chinese labour contracts to work in the mines for a certain period, and after that, they were released to find another job. Part of their wages deducted to repay the expenses to bring them into Malaya. Working conditions at the time it was very bad and they have been oppressed.

Similarly, the Indian labourers brought into Malaya. Most of them are from South India and they work in Malaya in the sugar cane plantations of coffee and rubber plantations. They are also bound under a contract system to work on these farms for a period of two or three years. Some of them continue to work on these estates and others working in various sectors, especially with the government. There is no one specific law to protect the labourers. The method used by the English merchants were to appoint a chief of his own people to manage their affairs. For example, in 1877, a Chinese Protector was appointed in the Straits Settlements to take care of public affairs and the Chinese workers to avoid persecution.

In general, the law (Ordinance) enacted labour in the nineteenth and early twentieth century was largely touched on immigration, working conditions for the admission of forced labour, housing, health conditions and so forth. In 1912, the Labour Department was established in the Straits Settlements and Federated Malay States. The Labour Code was enacted for the State of the Federated Malay States in 1912 and the Straits Settlements in 1920.


Covering the principles of relations between employers and workers in Malaysia were derived from three main sources: –

a. Common Law

b. Written law in Malaysia;

c. The decisions of the Industrial Court and Civil Court.

Common Law in Malaysia influence so broad. Unless the law involving religious affairs and family, many aspects of law in Malaysia is influenced by the Common Law. Occupation which is the reason. Common Law coming into this country through two channels, namely through the legislative and judicial.

Statute (written law) labour in Malaysia, many copied from the English labour statutes and India. Nevertheless, the statute labour in Malaysia is not entirely similar with the labour laws in both countries. To examine the provisions of the statute labour in Malaysia, there are certain provisions that are specific to Malaysia.

Statutes of labourers in Malaysia are the Employment Act, Industrial Relations, Trade Unions Act, the Social Security Act, Workmen's Compensation Act and others. This is the law on labour in Malaysia. Pursuant to section 3 and 5, the Civil Law Act, if there is a written law in Malaysia, Common Law does not apply. However, if there is a lacuna in the law, the principle of Common Law continues to apply to fill the lacuna.

Courts in Malaysia are mainly based on common law cases to clarify aspects of the labour laws in Malaysia, such as tests determine the existence or otherwise of "service contract" implied duty of an employer-employee and others. As far as can be seen, the courts in Malaysia do not discuss the matter when the court decides cases on labour.

Statutes of labourers in Malaysia are as follows:

a. Employment Act, 1955 (Revised 1981). (Amended 1989)

b. Trade Unions Act, 1959 (revised 1981), (Amendment 1989)

c. Industrial Relations Act 1957 (amended 1980, 1989)

d. Social Security Act, 1969

e. Factories and Machinery Act, 1967

f. Act (employment) Children and Young Persons Act, 1966

(Kamal Halili Hassan, 1990)

MALAYSIAN TRADES UNION CONGRESS (MTUC) It was in March 1978 that the General Council of the Malaysian Trades Union Congress adopted the Cameron Highlands Declaration. Ten years later, following a 2-day Symposium on 17-18 May 1989 at Genting Highlands, the Council revised and renamed the Camerons Highlands Declaration to "Labour’s Struggle Towards The Year 2000". One hundred and fifty trade union leaders representing affiliated unions and MTUC divisions participated in a three-day national symposium in Langkawi, Kedah from the 14th to 16th April 1997.

The symposium was held to review the MTUC 1989 document entitled "Labour’s Struggle Towards The Year 2000" with the objective of identifying MTUC’s and The Labour Movement’s role in the 21st century. Arising from the review, the symposium concluded that the "Labour’s Struggle Towards The Year 2000", while requiring an update, presents clearly the aspirations of the Labour Movement.

The symposium also noted that the implementation of the declaration was still far from satisfactory. The primary factors that contributed to this situation can be traced to: (a) lack of funds; and (b) the anti-labour and pro-capital attitude of the Government. While in certain fields of activities such as organising, there have been improvements in  other areas, labour laws, solidarity of the movement, commitment and dedication by leadership, income distribution, problems of poverty, trade union and human rights, racial polarisation, finance and administration, the situation has changed for the worse.

The MTUC, being the national labour centre for all workers in Malaysia, is without doubt a reflection of the composition of the various racial, religious and cultural communities living and working in the country. While that is its social fabric, the MTUC is well aware that its goals and struggle for the interests of the working population can only be pursued in the spirit of worker unity and solidarity where polarisation of any nature has no place. In identifying the role of the MTUC and the Labour Movement in the 21st century, the symposium concluded that The Document is still very appropriate and relevant and every effort should be made to achieve the goals and aspirations contained therein.

Both MTUC and trade unions need to take actions, individually and collectively towards this end. Having identified the areas of achievements and failures, the Symposium felt that it should be the solemn resolve of the MTUC that the last two years of the twentieth century should be treated as an aggressive period to full fill the aims and aspirations of the trade union movement. The coming millennium should witness a new labour reform, a new dynamic unionism and a new force in politics, capable of facing the challenges that lie ahead and of struggling for the aspirations of the working people. The labour movement must strengthen itself so that it will be recognised as a force to be reckoned with.

Towards this end it is vital to have a dynamic, dedicated, committed, progressive and knowledgeable leadership and a united and loyal membership. MTUC is opposed to profiteering because the system over-emphasizes materialism, which in turn generates greed which in turn negates human values. The MTUC’s struggle should therefore be geared towards the attainment of an egalitarian society, where there is freedom and equality; where there is no poverty; where ethics and human values are core of the people and where indulgence in bribery and corruption, misappropriation and non-accountability will be severely punished.

In fact all the programmes of the National Centre should continue to be geared towards ultimately attaining an egalitarian society. Having set its theme, the Symposium deliberated issues pertaining to economy, social services, politics, laws and trade union rights, information and communication, organisation and administration, and arrived at the following conclusions. AMENDMENT OF EXISTING PROVISIONS – EMPLOYMENT ACT 1955

|Section 2 (1) |: |Expansion of the definition of "delivery" is amended from 28 weeks to 22 weeks. | |Section 19 |: |Amended to give respite to the employers to pay overtime at least a day before the date of | | | |payment of wages the following month. | |Section 22 |: |Enable workers to apply for an advance payment for the purchase of computers, medical expenses | | | |and education (self and immediate family members), and daily expenses while waiting for | | | |compensation for temporary disability under SOCSO Act 1969. | |Section 25, 25A (1) and 25A (2) |: |

Payment of salaries / domestic servant legally amended from payment of tender on payment | | | |through bank account. | | | | | | | |Exception: Employers with written consent of the employee / domestic servants can pay in legal | | | |tender or pay checks. | |Section 37 (4) |: |Women workers cannot be terminated by the employer during the period of maternity leave. | |Section 60D |: |Entering Malaysia Day on 16 September each year as a mandatory public holiday. | |

Section 60K (3) |: |Require employers to inform the Department of Labour (Labour) within 30 days from the date of | | | |termination of contract by the employer / employee (including escape) / date of expiry of work | | | |permits / delivery of workers to their home countries. | |Section 69B |: |Expanding the scope of the investigation the Director General of Labour (KPTK) on complaints by| | | |employees of RM1, 500 to RM2, 000. | |Section 82 |: |Submission of parts by KPTK summons may be served not only to adult male family members but | | | |also to any adult family members, including women (excluding maids) who lived in the house. | |

Section 101A |: |Compound delegated to certain officers appointed by KPTK. | |Section 102 |: |Empowers the Minister on the formulation of regulations regarding the employment of foreign | | | |workers, particularly under section 60K, the procedure for handling sexual harassment | | | |complaints and investigations and prescribing the terms and conditions of employment of | | | |domestic servants. |


|Section 2 (1) |: |New definition of "labour contractors" (Export for labour) | | | | | | | |New definition of "sexual harassment" | | | | | | | |New definition of "foreign domestic servants" | |Section 33A |: |Compulsory labour contractors to register with KPTK if the intention / undertakes to supply | | | |workers and keep and maintain such information. | |Section 44A |: |Outlines that the provision of maternity leave in Part IX of the Act applies to all female | | | |employees regardless of their salary limit. | |Section 57A |:|Require employers to inform Labour Department within 30 days from the date of the employment of| | | |foreign domestic servants who work with them. | |

Section 57B |: |Require employers to inform Labour Department within 30 days if foreign domestic servants of | | | |the service contract is terminated by the employer (including escape) / date of expiry of work | | | |permits / transmission back to the country of origin. | | | | | |New Part XVA | |Section 81A |: |Explaining the meaning of the term "sexual harassment complaint." | |Section 81B |: |Duty on employers to investigate complaints of sexual harassment in the prescribed manner. | | | | | | | |

Employees who are not satisfied with the decision of the employer may refer to KPTK. | |Section 81C |: |To authorize the employer to take action without notice dismiss, demote or other actions if | | | |there is a conviction of the perpetrator after the investigation was conducted. | |Section 81D |: |If the complaint made directly to KPTK, KPTK may direct the employer to investigate the | | | |complaint. | | | | | | | |If a complaint is made against a sole proprietorship, the investigation will be conducted by | | | |the KPTK. | |Section 81E |: |If after an investigation found there was sexual harassment, the victim may terminate the | | | |service without notice. | | | || | | |

Provides benefits and damages that may be claimed by the victim. | |Section 81F |: |Provides for a fine not exceeding RM10, 000 if the employer fails to carry out investigations | | | |into complaints of sexual harassment. | |Section 81G |: |The provisions on sexual harassment covers all employees regardless of salary limits. | |Section 90A |: |Protecting Labour officers from any legal action by any party. | |Section 101B |:

|Allow of any offense by the organization, corporation, partnership, or a trade union, then any | | | |person who is a director, manager or similar officer, or all the partners and the office at the| | | |time of the offense may be prosecuted separately or together and deemed to have committing the | | | |offense. | |Section 2 (1) |: |Definition of "sub-contractor for labour" repealed and replaced with new definitions namely | | | |“contractor for labour”. | |Section 40 |: |"Lost of maternity allowance for failure to notify employer" abolished as intent is covered | | | |under Section 37 (4) which provides that service a female employee cannot be terminated by the | | | |employer during maternity leave. |


Duties of Employers

Duty of Providing Work

Once the employer agrees to take someone's employment and agreed to pay wages to workers and are willing to work for the employer, whether there is an obligation on employers to provide work for employees? This question is though somewhat odd, but it has been raised in several cases of Common Law.

Prohibition against work on the wrong side of the Law

Employer's responsibility does not put workers in employment or conditions that are illegal by law. It is a condition implied in the contract between employer and employee that the employer must comply with the law specified in the statute or common law.

Implications of employment law in violation of not only the participation of employers but also employees. Sometimes the workers also suffered losses. He may not be protected or the right of the statute if it can be proved to work is wrong in law. Employees may also be in a quandary or cannot do anything because the person committing the offense is an employer. In conclusion, it is an implied condition in the contract so that employers do not place workers in jobs or activities that are illegal act of law, and it is an implied term that employers comply with the provisions of any statute.

Prohibition of Hazardous Work

Become an implied term in a contract of service that the employer cannot require employees to work from harmful or ask employees to work in a dangerous place for employees.

Obligation to provide safe systems of work

Most modern industry uses a variety of machines, thus exposing workers to a variety of hazards. So the law implies that employers provide a safe system of work in place of employees at work. Employers are required to provide work equipment that is safe for use by employees. Obligation to provide safe systems of work are the responsibility of the employer and cannot be transferred to another person.

Staff Duties


It is an implied term in a contract of service that the employee must have and demonstrate competence in his work. If the employee to the employer stating competence, efficiency becomes important in service contracts. But it is said, if an employee merely stating competency in one area only, duty show that efficiency is limited to only that area. If an employer takes an employee who is known to not know how to do anything, then the employer will bear his own risk if the work done by that person leads to a loss ".

But in this modern age, this question is not how often arise because workers are trained before or during the occupation. Training may be formal or informal. If the employer has confirmed the position of workers, this means that the employer has received the efficiency of workers and employees already know what level of competence required by his employer. Serve the employer with the trust and good faith

Honestly and Sincerely

Employees must be honest and sincere to his employer. He must not do anything that may deliberately harm his employer.

Profit Confidential

Employees are responsible to the employer associated with money and property received during the period of service. He cannot make a secret profit from business or employer.

Working With Other Employers and Confidential Information

Although the common law, does not prohibit employees working in spare time to earn more, but the work must not interfere with his career with a regular employer. If an employee with a confidential basis to do work in other places that ruined his employer, the employer is entitled to an injunction to restrain the employee is working elsewhere in his spare time.

Duty of Care Much

Employees have the duty of care to the employer, and the breakdown of duty would bring a claim for damages for breaking the contract of service. A negligent behavior can result in a claim either under tort or express or implied term of contract


Wages are an important element in a contract of service. Payment of wages is the result of a contractual relationship between employer and employees. Wages paid by employers to employees because of the contractual relationship. Both employers and employees free to set the amount of wages to be paid by the employer and the wage payment is made. If there is a union collective agreement between employers or employers to trade unions in relation to any matter relating to wages, then there is the employer and employee will adhere to the agreement.

Employment Act does not prescribe a minimum wage. It only provides definitions, method of payment, discounts, and priority truck system of wages only. Employment Act only set minimum requirements to be complied with by the employer. This means that employers are free to set other conditions of service contracts. As long as those conditions do not violate the provisions of the Act, and employee benefits.

Wages may be paid by the employer to the employee, based on hours, days, weekly or monthly. It is up to the agreement between employer and employees. In addition, wages are also paid according to the amount of work done per item rate (piece-rate work). Wages paid to employees because of the employer of contractual relations. This means that if employers are unable to provide any work or tasks performed by workers, employers remain liable to pay wages to its employees. All conditions set forth in this act shall only apply to employees covered by this act (i.e. as applicable). For employees not covered by this act, provided that in relation to wages depends on the terms of the agreement entered into by the employer.

Workers' rights

Part XII of the Employment Act provides for the rights of workers. These rights are rest days, the period of work, holidays and others. Workers' rights are set to protect the interests of the workers. This section does not prohibit employers and employees, rather than specifying any conditions or terms that are quite different as long as it does not disadvantage the employee or inconsistent with the provisions of the Employment Act.

All the provisions of Part XII, of this act shall only apply to employees covered by this act (i.e. as mentioned in the first table or section 2 (3) or 2A of the Act). For employees not covered by this act, the conditions stated below are subject to the terms of the agreement entered into by the employer.

Day Break

Labor laws require employers to allow employees to rest after tired work. According to the Employment Act, each employee shall, in each week, allowed a full rest day. If the employee is allowed a rest day for more than one day in the week, the second rest day shall be considered as a rest day under the meaning of the Employment Act, 1955, section 59 (1).

For example, if a work from Monday to Friday, day of rest for the purposes of this section is a Sunday. Rest days does not apply to employees during maternity leave, sick leave and temporary disability under the Workmen's Compensation Act or the Social Security Act.

The employer shall prepare a list for the employee in case of selected days as rest days. In the event the same day each week was selected as a rest day for all employees in the workplace, the list may be substituted with a display notice at the workplace. Notice must be displayed in places that are hidden, told employees about the days of rest has been selected.

For any work performed in excess of working hours on a rest day, the charge is not less than double the rate of workers by the hour. For employees paid according to the amount of work done (the details follow), the amount paid is doubled for each of the work done on rest days either during or beyond normal working hours.

Work Period

The Employment Act sets the maximum for an employee to work. This does not mean the act prohibits an employer and employee from agreeing to a number of working hours as long as does not exceed the maximum hours prescribed by the Act for allegedly working as ordinary people certainly cannot afford to work without restrictions. Employees may not work:-

• more than 5 hours continuously without a break of not less than 30 minutes. (For those who work for 8 hours, while the rest period is not less than 45 minutes) • more than 8 hours a day

• more than 10 hours a day for a period of intermittent • more than 48 hours per week (The employer may increase the number of working hours to 12 hours but cannot exceed 48 hours per week) Total normal working hours or during working hours means the amount agreed upon by employers and employees in service contracts.


Employers are prohibited from allowing or requiring an employee to work overtime exceeding 64 hours in a month. Rates of payment for overtime for work performed on ordinary days worked is not less than one-half times the rate per hour. However, the rate of payment for "overtime" on a normal day at work, rest days and public holidays are different.

Public Holidays

Employment Act Section 60 (D) set 10 paid public holidays where four public holidays prescribed by the act and the rest appointed by the employer. Four public holidays are holidays for:-

• National Day • The Birthday of the King • Birthday of Sultan / King or the Governor of the state in place of employees working wholly or mainly in the state, Federal Territory Day for wholly or mainly of workers in the Federal Territory, and Labor Day

If any of the 10-day public holiday falls on a rest day, next day a public holiday shall be paid. If public holidays fall on the days specified below, the employer shall provide the other day as a day off with pay replacement described as sick leave, annual leave, temporary disability under the Workmen's Compensation Act or the Social Security Act.

Annual leave

Each employee is entitled to annual leave. Even so, the period of annual leave is not fixed: it varies according to length of service of an employee's service with the employer.

According to section 60 (E), the employee shall be entitled to paid annual leave for each twelve months continuous service under the same employer:- a. 8-day period of service if less than 2 years

b. 12 days if the service period is between 2 to 5 years c. 16 days if the service period of more than 5 years

Annual leave shall be granted by the employer and the employee within twelve months after the expiration of twelve months continuous service. Employees who fail to take annual leave within the prescribed period will lose the holidays. However, the amendments made in 1989; employee is entitled to payment in lieu of annual leave, if the request of his employer, he agrees in writing not to take annual leave.

Sick leave

Employees who are sick are not required to work. The Employment Act provides for the rights of sick leave to the employee but the employee must certify that he is sick.

Under section 60 F (1), an employee is entitled to sick leave after being reviewed:-

a. by the dentist as defined in the Dental Act 1971 b. by a registered medical practitioner appointed by the employer c. if no medical practitioner is appointed, or in some cases, the appointed medical practitioner is not available within a reasonable time and distance, the employee may be treated by any medical practitioner or medical officers.

Care expenses or medical examination shall be borne by the employer. In a year, employees are entitled to twelve till twenty days of paid sick leave depending on length of service.

Standard Rate Payments

The word 'normal rate of payment "mentioned in many of the Employment Act. 'Ordinary rate of payment "is to calculate the payment.

a. Overtime

b. public holiday c. sick leave d. maternity leave e. annual leave f. work on rest days g. work on public holidays

Ordinary rate of wages means payments must be paid to employees under the contract for the amount used to work for a day but does not include payment for work done on rest days or public holidays. Ordinary rate of payment calculated on a daily rate even if wages are paid on a monthly basis, weekly, hour or so. It also includes bonuses and allowances as agreed between employer and employees under contract of service. Payment rate by the hour is the normal payment rate means divided by the total hours worked.


a. This act should be amended to ensure that the minimum wage for workers of all sectors of rm1, 500.00. In order to ease the financial burden incurred by the employee. Moreover, the higher cost of living at this time. It is also a timely effort in bringing the country to achieve Vision 2020 and to eliminate the overall poverty rate in the country by the year 2020.

b. Other than the government sector, private sector also need to provide paid leave to encourage workers in acquiring knowledge. Indirectly it will also produce skilled workers in the organization. The organization may also bear the cost of such studies with certain conditions. With this we can reduce the suspension of foreign skilled Employment.

c. In this act to ensure that its employees are given bonuses or additional incentives such as sending workers to travel within or outside the country. It because it is able to edit the spirit of workers to produce higher quality work. In addition it will provide to the employee break room in the holiday period, and indirectly they will cherish and work hard for the employer.

d. Employer must also provide to each employee's medical card or a need to provide a panel clinic or hospital. It to ensure the welfare of workers. This will also secure the health and safety of workers during or after.

C Employment at Will …Employment at Will When we are dealing with the employment relationship between employers and employees, ethical issues are most likely to emerge. Especially, if a manager fires a worker without a proper reason, critics will follow this employer’s behavior. In Patricia Werhane’s paper, “Employment at Will and Due Process”, discusses two doctrines which are Employment at Will (EAW) and Due Process. It also addresses some justifications…