Termination and Lay-off Benefits

  • Act/Rule/Legislation

  • Online Link to Act/Rule/Legislation

  • Initial Setup or Ongoing Maintenance

    Ongoing compliance requirement

  • Filing and Maintenance Requirements

    Any employee whose contract of service is terminated or he is laid off by his employer, he is entitled to the payment by employers of: (a) termination benefits; (b) lay-off benefits; However an employee shall not be entitled to termination benefits payment under the following circumstances - (a) upon the employee attaining the age of retirement if the contract of service contains a stipulation in that behalf; or (b) dismissed by the employer, on the grounds of misconduct, or (c) resigns voluntarily by the employee. Furthermore an employee shall not be entitled to any termination benefits payment if - (a) his contract of service is renewed, or he is re-engaged by the same employer under a new contract of service on terms and conditions which are not less favourable; and (b) the renewal or re-engagement takes effect immediately on the ending of his employment under the previous contract. An employee is deemed to be laid-off if - (a) the employer does not provide such work for him on at least a total of twelve normal working days within any period of four consecutive weeks; and (b) the employee is not entitled to any remuneration under the contract for the period or periods (within such period of four consecutive weeks) in which he is not provided with work; Termination and lay-off benefits payment shall not be less than - (a) 10 days’ wages for every year of employment under a continuous contract of service with the employer if he has been employed by that employer for a period of less than 2 years; or (b) 15 days’ wages for every year of employment under a continuous contract of serviced with the employer if he has been employed by that employer for 2 years or more but less than 5 years; or (c) 20 days’ wages for every year of employment under a continuous contract of service with the employer if he has been employed by that employer for 5 year or more, and pro-rata as respect an incomplete year, calculated to the nearest month. Any termination or lay-off benefits payment payable shall be paid by the employer to the employee not later than seven days after the relevant date.

  • Penalty

    Any person who commits any offence under, or contravenes any provision of,Employment (Termination and Lay-Off Benefits) Regulations 1980, or any regulations, order, or other subsidiary legislation whatsoever made thereunder, in respect of which no penalty is provided, shall be liable, on conviction, to a fine not exceeding ten thousand ringgit.

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