No — an employer cannot freely dismiss or refuse to confirm a probationer in Malaysia. A probationer has the same protection against dismissal without just cause or excuse as a confirmed employee, and can claim unfair dismissal under Section 20 of the Industrial Relations Act 1967 within 60 days. The correct process is objectives, honest appraisal, a fair chance to improve (or extension), and a due inquiry for misconduct.
The single most expensive belief in Malaysian HR is that “they’re still on probation, so we can just let them go.” You cannot. Once a person is engaged under a contract of service, the law treats a probationer as a workman who is protected from dismissal without just cause or excuse — the same standard that protects a confirmed employee. Get the process wrong and a non-confirmation or a probation-period termination can land at the Industrial Court as an unfair-dismissal claim. This guide sets out what the law actually requires, with the exact authorities, so your decision is defensible. It is the same compliance discipline Carriera applies when we place and onboard talent through our recruitment service.
Can an employer freely dismiss a probationer?
Can an employer freely dismiss a probationer in Malaysia?
No. A probationer is not freely dismissable. Malaysian law gives a probationer the same protection against dismissal without just cause or excuse as a confirmed employee, and that protection is enforced through Section 20 of the Industrial Relations Act 1967 (Act 177). An employer cannot terminate a probationer at pleasure and will, on a whim, or for an improper motive such as discrimination or victimisation.
This is settled law. The Court of Appeal in Khaliah binti Abbas v Pesaka Capital Corporation Sdn Bhd [1997] confirmed that a probationer cannot be dismissed without just cause or excuse — a probationer enjoys the same security of tenure during the probation period as a permanent employee. The statute itself is the Industrial Relations Act 1967 (Act 177), published on the Attorney General’s Chambers Laws of Malaysia portal. So the question is never “are we allowed to part ways?” — it is “can we show a genuine, fair reason, properly handled?”
The correct process, step by step
What is the correct process to terminate a probationer for poor performance?
For poor performance, the law expects a real, supported attempt to help the probationer succeed before you decide to let them go. The Industrial Court has repeatedly stressed that an employer must not act “mechanically” — a probationer has a legitimate expectation of being confirmed and an implied right to be heard. Follow these four steps and document each one.
Set clear objectives
At the start of probation, give written duties, standards and what “confirmation-ready” looks like. You cannot fairly fail someone against a target they were never told.
Appraise & document
Run honest mid-probation appraisals. Record concerns in writing, with dates, examples and the specific gap — not a vague “not a fit”.
Give a fair chance
Counsel, guide and train. Issue a warning where needed and allow a genuine, time-bound opportunity to improve, with support — not a paper trail built to justify a decision already made.
Confirm, extend or release
Decide in writing. If there is still potential, extend probation as the safer alternative. Only terminate when the documented effort genuinely failed.
The 2024 reminder from the bench is blunt. In Adeline Yeoh v Tune Insurance Malaysia Bhd (Industrial Court, December 2024), the Court held that an employer “has an implied duty to hear the legitimate grievances of the probationer” and must guide rather than act arbitrarily; the refusal to confirm after three extensions was found “arbitrary and capricious”, and the company was ordered to pay compensation. The lesson: extensions are not a way to keep someone in limbo — they must be used to genuinely help the person improve.
What if it is misconduct, not performance?
Misconduct is a different route, and it has its own mandatory step: a due inquiry. Before dismissing a probationer for misconduct, issue a show-cause letter setting out the allegation, give the employee a fair chance to respond, and hold a domestic inquiry to establish the facts before deciding. Skipping the inquiry is itself a procedural defect that can make an otherwise-justified dismissal unfair. For genuinely grave misconduct, dismissal may be warranted — but the process still matters.
Confirm, extend or terminate?
Confirm vs extend vs terminate — how do I decide?
At the end of probation you must take a positive decision — do not let it drift. Use this table to match the situation to the right, defensible action.
| Situation | Correct action | What it requires | Risk if mishandled |
|---|---|---|---|
| Meets the standard | Confirm | Written confirmation letter; update status and benefits | Low — this is the expected outcome |
| Borderline / improving with potential | Extend probation | Written notice, a clear reason, defined goals and a fixed end date | Moderate — vague or repeated extensions read as keeping the person in limbo |
| Genuine, documented underperformance | Terminate (performance) | Objectives, appraisals, warning, supported chance to improve — all on record | High — thin documentation is the usual reason employers lose |
| Serious misconduct | Terminate (after due inquiry) | Show-cause letter, fair chance to reply, domestic inquiry, then decision | High — no inquiry is a procedural defect |
| Probation lapsed, no action taken | Decide now — in writing | Don’t rely on silence; confirm or extend explicitly | High — conduct can imply confirmation |
If probation lapses and we say nothing, is the person confirmed?
Not automatically, but do not rely on silence. Following the Federal Court in KC Mathews v Kumpulan Guthrie Sdn Bhd [1981], silence does not equal confirmation — without a positive act, the probation is generally deemed extended and the person remains a probationer. However, the Industrial Court has held that treating someone as permanent (granting permanent benefits, or leaving them in indefinite limbo) can imply confirmation. The safe rule is simple: at the end of probation, always confirm, extend or release in writing. For how this interacts with notice and termination benefits, see our Employment Act 1955 employer guide.
The claim window and remedy
How long does a probationer have to claim, and what can they be awarded?
A dismissed probationer can pursue an unfair-dismissal claim under Section 20 of the Industrial Relations Act 1967. According to the Department of Industrial Relations (Jabatan Perhubungan Perusahaan, MOHR), a workman who considers their dismissal was without just cause or excuse must file a written representation within sixty (60) days of the dismissal, addressed to the Director General of Industrial Relations. The Director General first attempts conciliation; if there is no settlement, the case is referred to the Industrial Court for an award.
| Item | Detail | Source |
|---|---|---|
| Claim route | Unfair-dismissal representation under Section 20, IRA 1967 | IRA 1967 (Act 177) |
| Filing deadline | Within 60 days of the dismissal, in writing, to the Director General | Dept. of Industrial Relations (MOHR) |
| Process | Conciliation by the Director General; if unresolved, referred to the Industrial Court | Dept. of Industrial Relations (MOHR) |
| Remedies | Reinstatement, or compensation in lieu plus backwages | Industrial Court |
| Backwages cap — confirmed | Up to 24 months of last-drawn salary | IRA 1967 / Industrial Court |
| Backwages cap — probationer | Up to 12 months of last-drawn salary | IRA 1967 / Industrial Court |
The 60-day window and the conciliation-then-Industrial-Court route are stated on the official Department of Industrial Relations portal; the backwages caps reflect the Industrial Court’s settled practice. For the binding text, refer to the Industrial Relations Act 1967 (Act 177) and the latest practice notes.
The defensible-dismissal checklist
What documents make a probationer dismissal defensible?
If you ever have to justify the decision, these are the records the Industrial Court looks for. The absence of them — not the dismissal itself — is what usually loses the case.
- Signed offer / contract stating the probation period and that confirmation is not automatic.
- Written objectives & KPIs given at the start of probation, so the standard is on record.
- Dated appraisals at least once during probation, with specific feedback (not generic).
- Warning / counselling notes identifying the gap and the support offered to close it.
- A genuine improvement window — time and help to improve, evidenced in writing.
- Extension letter (if extended) with reasons, goals and a fixed end date.
- For misconduct: show-cause letter, the employee’s reply, and minutes of the due inquiry.
- A written decision letter — confirmation, extension or termination — with clear reasons.
Most of these failures are training gaps, not bad intentions: a line manager who never set objectives, or an HR team that let probation lapse. That is exactly what our HRD Corp-claimable Basics of Writing Human Resource Policies and the Manual programme is built to fix — turning the rules above into the policies, letters and procedures your managers actually use. Browse the full schedule on our training page.
Probationer termination — employer FAQ
This guide is general information, not legal advice. For the binding text, refer to the Industrial Relations Act 1967 (Act 177) and the Department of Industrial Relations (Jabatan Perhubungan Perusahaan) under the Ministry of Human Resources, and take advice on your specific case. Updated 18 June 2026.
Train your managers to handle probation the right way
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