Malaysia's Employment Law on Working Hours and Overtime

In Malaysia, overtime is still popular among companies, especially in the F&B sector. But overtime can be a very confusing matter. In this article, we will study the laws governing the hours of work and overtime work for employees under Malaysia’s labour laws.
 

Employment Act 1955

If the employee’s salary does not exceed RM2,000 a month or falls within the First Schedule of Employment Act 1955, then we will refer to the Employment Act 1955.

If the employee’s salary exceeded RM2,000 a month, then the hours of work and overtime will be referred to the terms agreed under the employment contract.

The hours of work and overtime work directly affects productivity and profitability, therefore companies, especially in the industrial sector, should pay extra attention to this part.

Working Hours

Based on section 60A(1) of the Employment Act 1955, an employee shall not be required under their contract of service to work:-

• More than 5 consecutive hours without a period of leisure of not less than 30 minutes duration;

• More than 8 hours in 1 day;

• In excess of a spread over a period of 10 hours in 1 day;

• More than 48 hours in 1 week.

This provision was made at the time when most employees in Malaysia work for 6 days a week, so, they’re required to work only 8 hours a day maximum.

BUT, an amendment came into effect on 1st August 1998 in the form of proviso (iii) to section 60A of the Employment Act 1955.

The law allows that, through an agreement between the employers and employees, where the numbers of working hours on 1 or more days of the week is less than 8 hours, the limit of 8 hours may be exceeded on the remaining days of the week, provided that no employee shall be required to work for more than 9 hours in 1 day / 48 hours in 1 week.

This provision is meant to cater for those who wish to work for 5 days a week instead of 6 days. For example, if the employee is not required to work on Saturday, then for the remaining days of the week, the employee will be required to work for more than 8 hours but not longer than 9 hours in 1 day.

Overtime Working Hours

Section 60A(3) of the Employment Act defines that ‘overtime work’ means the number of working hours carried out in excess of the normal working hours per day as provided in the section 60A(1) of the Employment Act.

Of course, overtime work has a limit. The Employment (Limitation of Overtime Work) Regulations 1980 grants that the limit of overtime work shall be a total of 104 hours in any 1 month. This means an average of 4 hours in 1 day.

Even though the pay rate is 1 ½ time the hourly rate of employee pay, some employers found it rather economical to ask employees to work overtime than hire a new employee.

The employers should still remember that they cannot require any employee under any situations to work longer than 12 hours in one day. 

Source: Chia, Lee & Associates

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