We're celebrating 10 Days of Membership! Today's Gift: $20 off your professional membership with promo 10DAYS20OFF
Training, policies and tools to help HR prevent and respond to harassment claims.
Is your employee handbook keeping up with the changing world of work? With SHRM's Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Develop your HR competencies and knowledge in-person in 12 U.S. cities or virtually.
#SHRM18 will expand your perspective – on your organization, on your career, and on the way you approach HR. Join us in Chicago June 17-20, 2018
Key Development for 2017
Consequential changes to labour laws from trade agreement
The Malaysian government has stated that it is looking to amend and complete domestic ratification of legal procedures for the Trans-Pacific Partnership Agreement by mid-2017. There will be amendments to labour laws (on eight pieces of legislations), policies and practices as a consequence.
Key Developments for 2016
Mandatory social security contributions for all employees
Social Security contributions became mandatory for all employees regardless of salary. However, contributions will be capped at the monthly remuneration of RM4,000.
Increase in minimum wage
The Minimum Wages Order 2016 came into effect on July 1, 2016, and affects all private sector employees (except domestic helpers) with rates set at: RM1,000 per month or RM4.81 per hour for Peninsular Malaysia, and RM920 per month or RM4.42 per hour for Sabah, Sarawak, and Labuan.
Exemption of certain employers to minimum retirement age laws
Under the Minimum Retirement Age (Exemption) Order 2016, the Minister of Human Resources has issued several orders to exempt certain employers from legislation which would otherwise provide a minimum retirement age of 60 years. This also excludes those employed on a fixed term service contract for over 24 months and less than 60 months with a basic wage of RM20,000 per month or more.
Reduction in employees' contribution towards retirement benefit scheme
There has been a reduction in the statutory contribution rate under the Employee Provident Fund (retirement benefit scheme) for employees (i) from 11 percent to 8 percent for employees below the age 60, and (ii) from 5.5 percent to 4 percent for employees above the age of 60, from March 2016 until December 2017. The contribution rate for employers, however, remains at the current rate.
With thanks to Wong Kah Hui of Kadir & Andri Partners for his invaluable collaboration on this update.
Suzanne Horne and Hannah Harris are attorneys with Paul Hastings LLP in London. © 2017 Paul Hastings. All rights reserved. Reposted with permission of
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Your session has expired. Please log in again before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
Become a SHRM Member
SHRM’s HR Vendor Directory contains over 3,200 companies