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Malaysia News: Proposed amendments to employment law

In late 2018, the Ministry of Human Resources (MOHR) proposed significant amendments to the Employment Act 1955 (EA) and the Industrial Relations Act 1967 (IRA). At present, the Ministry is seeking public feedback, and the proposals are subject to further revisions.

The proposed changes are part of the MOHR’s initiative to better align Malaysia’s employment law with the standards of the International Labour Organisation Convention. If approved, the amendments will have wide-ranging effects on Malaysia’s employment law landscape, most notably in four respects:

A. The term “employee” will be redefined, with the consequence of more individuals being categorised as employees and being entitled to the benefits of that status.

B. There will be substantially greater workplace protection for employees in relation to working hours, discrimination, maternity considerations and sexual harassment;

C. The system for employing foreign employees will be reformed; and

D. An Industrial Appeals Court will be created, introducing a right of appeal against awards of the existing Industrial Court. Though by no means an exhaustive guide to the MOHR’s proposals, this newsletter aims to address these four issues in turn and examine their potential implications for employers.