On 21 March 2022, the Dewan Rakyat has taken a further step in passing the Employment (Amendment) Bill 2022 (‘Bill’) to amend the Employment Act 1955 (‘EA 1955’). The said Bill was passed in Dewan Negara on 30 March 2022 and assented on 26 April 2022 and gazetted as the Employment (Amendment) Act 2022 (‘Amendment’). On 15 August 2022, by way of Gazette Notification, the Minister of Human Resources appointed 1 September 2022 as the date on which the Amendment comes into operation. In this article, we will discuss on the rights and liabilities provided by the Amendment and the next course of action for both employers and employees amid the enforcement of the Amendment.
The Amendment On The First Schedule of EA 1955
Following the Employment (Amendment of First Schedule) Order 2022 (‘Amendment of First Schedule’), all provisions under EA 1955 will be applicable to all employees who entered into a contract of service irrespective of their wages. However, an exception is made to employees earning more than RM4, 000.00 a month wherein they are not covered for the provision in relation to overtime payment and termination benefits provided.
Reduced Maximum Weekly Working Hours
Next, the Amendment has reduced the maximum weekly working hours for the employees from 48 hours to 45 hours per week. An employee who is covered under the EA 1955 is entitled to overtime payment in the event the working hours exceed 45 hours except for employees earning more than RM4,000.00 a month.
The Flexible Working Arrangement
Following the shift in work culture after the COVID-19 pandemic, EA 1955 now allows employees to request flexible work arrangements by making a written request to their employer. Employers shall reply to the application within sixty days and give reasons for their decision if the application is rejected. It is pertinent to take note that the flexible working hours shall comply with the provisions of EA 1955 in respect of working hours, payments and benefits provided under the Act.
Maternity And Paternity Leave
Paid maternity leaves are increased from 60 days to 98 days in line with Article 4 of the Maternity Protection Convention, 2000 (No. 183). Further, the Amendment also provides paid paternity leaves for 7 days which are limited to 5 confinements.
Prohibition On Termination Of A Female Employee Who Is Pregnant Or Suffering From Illness Arising Out Of Her Pregnancy
The Amendment seeks to widen the protection towards female employee who is pregnant or suffering from illness arising out of her pregnancy wherein termination or issuance of notice of termination is restricted unless on the grounds of misconduct, willful breach of employment contract or closure of business. Further, in the event of termination, it is the employer’s burden to prove that, such termination is not on the ground of her pregnancy or on the ground of illness arising out of her pregnancy.
Notice Of Sexual Harassment
Section 81H provides that a notice to raise awareness of sexual harassment shall be exhibited conspicuously at the place of employment.
Discrimination In Employment
Section 69F is inserted in relation to the power of Director General to inquire into, decide and make an order on any dispute between employer and employee in relation to discrimination in employment. Employers who fail to obey the order issued under this provision is liable to a fine not exceeding RM50,000. For continuing offence, employers shall be liable to a daily fine of RM1,000.00 for each day the offence continues after conviction.
The Increment of General Penalty From RM10, 000.00 to RM50,000.00
The general penalty for some offences is increased from RM10,000.00 to RM50,000.00. The general penalty is applicable to the offences which no specific penalty is provided for the said offence.
Court Order For Payments Due To Employee
Where an employer has been convicted of any offences in relation to payment of wages or any payment to the employee, the Court may order for the employer to pay any payment due to the employee. In the event of default, the employee may apply to the Court to issue a warrant to levy the employer’s property by way of, among others, distress and sale of the property.
The Next Course Of Action
Hence, following the said Amendment, employers shall aware of the said amendments and make the necessary revision towards the existing employment contracts with their employees and ensure the terms in the contracts are in compliance with the latest amendment of EA 1955. Particularly in the expansion of the scope of EA 1955 which cover all employees irrespective of their wages (except overtime payment and termination benefits) as the nation’s labour law has moved forward from restricting the applicability of EA 1955 on certain wage threshold.
Few revisions that may be necessary are as follows: –
- The arrangement for the working hours of their employees wherein if the employer, for operational reasons, has to maintain the current 48 hours/week arrangement, overtime payment shall be paid to their employees earning below RM4,000.00.
- The provisions for paid maternity and paternity leaves wherein necessary human resources must be reshuffled to ensure the operation is not halted by the enforcement of the said Amendment.
- The company’s policy may be necessary to be revised to include the procedures in the application for flexible working arrangement.
- For the employer to provide trainings and consultations to the employees in raising the awareness about sexual harassment at the workplace in addition to the requirement of the notice.
For employees, actions may be taken by way of civil action (if applicable) or by lodging a report to the authorities in the event the employer refused or failed to comply with the provisions under EA 1955.
Author: Azrul Haziq Khirullah
Published Date: 26 August 2022
References
- P.U.(B) 368/2022 Appointment of Date of Coming into Operation
- P.U. (A) 262/2022 Employment (Amendment of First Schedule) Order 2022
- Employment (Amendment) Act 2022
- Paragraph 1A of the First Schedule of EA 1955
- Section 60A(1) of EA 1955
- Section 60P of EA 1955
- Section 37(1)(d)(ii) of EA 1955
- Section 60 FA of EA 1955
- Section 41A of EA 1955
- Section 81H of EA 1955
- Section 69F of EA 1955
- Section 99A of EA 1955
- Section 87A(1) of EA 1955
- Section 87A(2) of EA 1955