Scope of Employment Act 1955

On 15 August 2022, the Employment (Amendment of First Schedule) Order 2022 (“First Schedule Amendment Order”) was gazetted, and the following changes to the scope of the Employment Act 1955 (“EA”) shall be effective from 1^st September 2022.

Prior to the First Schedule Amendment Order

EA only applied to employees earning up to RM2,000.00 a month, or employees who, regardless of salary earned, fulfilled certain criteria i.e engaged in or supervised manual labour, operated mechanically propelled vehicles, engaged in certain capacities onboard a Malaysian registered vessel, and engaged as a domestic employee.

Subsequent to the First Schedule Amendment Order

EA applies to all employees (“any person who has entered into a contract of service”) irrespective of wages, however, some sections will not apply to employees earning more than RM4,000.00 a month.

The provisions that do not apply to employees who earn more than RM4,000.00 include:

• Overtime for work on rest days (section 60(3)) EA), outside of normal working hours (Section 60A(3) EA), public holidays (section 60D(3) EA), on holidays falling on half working days (section 60D(4) EA);
• Shift work allowance (section 60C(2A) EA);
• Termination, lay-off and retirement benefits (section 60J EA)

It would be important for Employers to take note of the above changes and to assess their policies and procedures accordingly.

Note that the much talked about Employment (Amendment) Act 2022 shall also be coming into operation on 1^st September 2022.