Employment Act 1955 Malaysia: an employer guide to the 2022 amendments

The Employment Act 1955 (Act 265) is the backbone of Peninsular Malaysia's employment law, and the Employment (Amendment) Act 2022 was the most significant overhaul in a generation. For employers, the practical risk is simple: contracts, handbooks and payroll built around the old rules are now non-compliant. This guide walks through the 2022 amendments to the Employment Act 1955 provision by provision, with the exact section references and authoritative sources, so your hiring and HR practice stays on the right side of the law. Carriera is a compliance-focused recruitment partner — Employment Act literacy is one of our four differentiators — so this is the same checklist we apply when we place candidates for our clients.

Does the Employment Act 1955 now apply to all employees in Malaysia?

Yes. Since 1 January 2023 the First Schedule of the Employment Act 1955 was amended so the Act covers any employee under a contract of service, regardless of wages. Before the amendment, full protection was largely limited to those earning RM2,000 a month or below. The expansion is the single most far-reaching change for employers.

There is one important nuance. A set of wage-related entitlements — overtime, rest-day and public-holiday pay, shift allowance and termination benefits — still only apply to employees earning RM4,000 a month or below, under sections 60(3), 60A(3), 60D(3), 60C(2A) and 60J. So an employee earning above RM4,000 is now covered by the Act for matters such as contracts, maternity and notice, but is not automatically entitled to statutory overtime pay. This RM4,000 line is the boundary every payroll team needs to map onto their headcount. See our glossary for plain-language definitions of these terms.

What are the maximum weekly working hours now?

The maximum normal working hours under the Employment Act 1955 were reduced from 48 to 45 hours per week, excluding meal breaks, under the amended section 60A. This took effect on 1 January 2023. Any hours worked beyond 45 in a week count as overtime for employees within the Part XII wage threshold, paid at not less than 1.5 times the ordinary hourly rate. The change is confirmed by ACCA Global's technical overview of the amendments.

For employers running a six-day operation, this often means re-scheduling shifts so a normal week lands at 45 hours rather than 48 — otherwise three additional hours each week silently become overtime liability.

How much maternity and paternity leave must employers give?

Under the amended Employment Act 1955, eligible female employees are entitled to 98 days of paid maternity leave per confinement under section 37 — up from 60 days — bringing Malaysia into line with the ILO minimum. The amendment also strengthens pregnancy protection: an employer generally cannot terminate a pregnant employee except for wilful breach, misconduct, or closure of the business.

The amendments also introduced paternity leave for the first time. Under section 60FA, a married male employee is entitled to 7 consecutive days of paid paternity leave per confinement, for up to five confinements, provided he has been employed by the same employer for at least 12 months and notifies the employer (generally at least 30 days before the expected confinement). These conditions are set out in altHR's amendment summary.

Can employees request flexible working arrangements?

Yes. A new Part XIIC of the Employment Act 1955 (sections 60P and 60Q) lets an employee apply in writing to vary their hours, days or place of work. The employer must respond in writing within 60 days, either approving the request or stating the grounds for refusal. The right is to request and receive a reasoned decision — it is not an automatic right to work from home.

How many days of sick leave are employees entitled to?

Under section 60F of the Employment Act 1955, paid sick leave without hospitalisation is tiered by length of service, and hospitalisation leave is a separate, larger entitlement. Where hospitalisation is necessary, employees may take up to 60 days of paid hospitalisation leave per calendar year, distinct from ordinary sick leave, as confirmed across Malaysian HR-law guidance including this section 60F sick-leave breakdown.

What changed in the Employment Act 1955 — before vs after?

The table below summarises the headline shifts an employer must reflect in contracts, handbooks and payroll. All figures are verified against the section references noted; the amendments came into force on 1 January 2023, per the official JTKSM (Department of Labour) circular under the Ministry of Human Resources.

Why does this matter for hiring and HR training?

Compliance is no longer a back-office detail — it shapes who you can hire, how you write the offer, and what your managers can lawfully ask of staff. A line manager who does not know the 45-hour week, or an offer letter that omits paternity leave, creates avoidable disputes. This is why Carriera screens for compliance awareness when we place HR, finance and management roles through our recruitment service, and why Employment Act literacy sits alongside our knowledge of the Malaysian salary market.

Keeping HR and line managers current is also fundable. Under the PSMB Act 2001, employers with 10 or more Malaysian employees pay a monthly HRD Corp levy of 1% of wages (employers with 5 to 9 employees may register at 0.5%), per HRD Corp's official guidance. That levy can fund approved training — including Employment Act and HR-policy programmes. Carriera Academy is an HRD Corp Approved Training Provider, so SBL-Khas-claimable courses on employment law, payroll and HR practice are available through our corporate training. To see how the levy works, read our FAQ or speak to us directly.

This guide is general information, not legal advice. For the binding text, refer to the Employment Act 1955 (Act 265) and the Department of Labour (JTKSM) under the Ministry of Human Resources. Updated 17 June 2026.