Know Your Rights When Your Boss Doesn’t Pay Your Salary On Time

Q1. What are the important rights of an employee in Malaysia? 

Malaysian Employment law is governed by the Employment Act 1955. Although not all employees fall under Employment Act 1955[1] (hereinafter being referred as “EA employees”), the non-EA employees will be governed by the terms of their employment contract.

Generally, the rights of the employee in Malaysia are:-

• Probation period

• Wages and/or salary

• Working hours

• Overtime

• Annual leave

• Sick leave

• Public holidays

• Maternity leave

• Termination

Q2. When should salary payments be made by the Employer to his employees?

Section 19 of the Employment Act 1955 provides that the Employer shall pay each of his employees within 7 days after the last day of any salary payment period.

Meaning that, your salary for May 2021 should be paid by 7th June 2021.

Q3. If I still have not received my salary on the 15th of June, is the Employer considered late to pay my salary and what can I do?

Yes, based on Section 19 of the Employment Act 1955, your Employer has violated the said section. You can discuss with your management to come to a mutual understanding. However, if that does not work, you can take legal action and/or make a complaint against your Employer for its failure to pay your salary as provided by the law.

Q4. How do I make a complaint?

• Complaints can be made by personally attending the nearest Labour Office or sending an official letter to the nearest Labour Office or email to jtksm@mohr.gov.my.

• After making a complaint, you are required to make to make a statement of claim on oath and bring a long documentary evidence, if any (e.g. contract of service or appointment letter).

• After that, you will be advised to wait for further notice from the Labour Office (while they do their investigation).

• The Labour Officer may contact your Employer concerning your claim. If the Employer accepts your claims and pays up, the matter is settled and you will withdraw the claim against your Employer. If the Employer disputes your claim, the Labour Officer will fix a date to hear the case in the Labour Court.

• Both parties are required to attend the hearing. you would be informed by letter (may be registered letter) and a summons would be issued to the defendant i.e. the Employer.

• You may choose to represent yourself, or be represented by trade union, by a lawyer or an official from the Malaysian Trades Union Congress (MTUC) (if the Complainant seek their help). The defendant may represent himself, or by his lawyer.

• At the end of the hearing, the Presiding Officer makes an order either orally or in writing.

  
  

Q5. If any of the party is not satisfied with the decision or order made by the Labour Court, can it be appealed upon?

Yes. Any party not satisfied with the decision of the Presiding Officer can appeal to the High Court within fourteen (14) days from the date of the decision or order is made.

If the defendant does not appeal to the High Court and does not want to obey the order of the Labour Court, the Labour Office will assist to enforce its order in the Sessions Court in order to recover the money.

Q6. What if after I resign my job and my ex-employer still does not pay my salary, how long should I wait? 

By rights, you shouldn’t be waiting for months for your salary to be paid by your former Employer as when your contract with your Employer ended and you are leaving (resign in good terms by serving the notice period), your salary must be paid on the day you are officially terminated[2].

You can go to the Labour Office and file your claim under Section 69 of the Employment Act 1955.

Q7. Can I still get my salary if I quit without notice?

No. In fact, you need to pay your Employer as provided under Section 21 of the Employment Act 1955[3].

For example, you need to pay 2 months salary as compensation to your Employer as indemnity in lieu of 2 months’ notice period.

However, if your Employer terminates you without notice, you can file your claim under Section 69 of the Employment Act 1955 at the Labour Office.

Q8. Can I still file a complaint at the Labour Office if my salary more than RM5,000.00?

You are still covered under Malaysian employment law because you are still an employee or a “workman” as defined under Section 2 of the Industrial Relations Act 1967[4].

If you and your Employer can’t settle things, the Industrial Relations Department will step in and/or get involved.

Q9. How do I make a complaint to the Industrial Court?

The Industrial Relations Department will report to the Director General of Industrial Relations. The Director General of Industrial Relations will try to resolve the matter through conciliation between the parties[5]. If conciliation fails, the Director General of Industrial Relations will refer the matter to the Minister, who then will try to settle things[6]. If that falls through, then he may refer the matter to the Industrial Court for a decision (an Award).

Q10. Can there be an appeal against the decision of the Industrial Court?

Yes, any party who is dissatisfied with an award of the Industrial Court may appeal to the High Court within fourteen (14) days from the date of receipt of the award[7].

FOOTNOTES 

[1] Section 2 of the Employment Act 1955 – employees whose monthly salary does not exceed RM2,000.00

[2] Section 20 of the Employment Act 1955

[3] 21.Payment on termination of contract in special circumstances and on breach of contract

1. Where an employer terminates the contract of service of an employee without notice in accordance with subsection 13(1) or (2) and paragraph 14(1)(a)

2. a) the wages, less any deductions which the employer is entitled to make under section 24, earned by such employee up to and including the day immediately preceding the day on which the termination of the contract of service takes effect; and
   b) in addition, where the employer terminates the contract of service under subsection 13(1), the indemnity payable to the employee under that subsection, shall be paid by the employer to the employee not later than the day on which such contract of service is so terminated.

3. Where an employee terminates his contract of service with an employer without notice in accordance with subsection 13(1) or (2) or subsection 14(3), the wages, less any deductions which the employer is entitled to make under section 24, earned by such employee up to and including the day immediately preceding the day on which the termination of the contract of service takes effect shall be paid by the employer to the employee not later than the third day after the day on which the contract of service is so terminated.

[4] …any person, including an apprentice, employed by an employer under a contract of employment to work for hire or reward and for the purposes of any proceedings in relation to a trade dispute includes any such person who has been dismissed, discharged or retrenched in connection with or as a consequence of that dispute or whose dismissal, discharge or retrenchment has led to that dispute.

[5] Section 18 of the Industrial Relations Act (IRA) 1967

[6] Section 19A of IRA 1967

[7] Section 33C of IRA 1967 (effective 1st January 2021)

THIS FAQ IS PREPARED AND PUBLISHED BY GENERAL LITIGATION, CORPORATE INSOLVENCY AND APPELLATE DEPARTMENT OF THE DISPUTES RESOLUTION OF MESSRS GAN & ZUL, ADVOCATES & SOLICITORS.