Wednesday, May 01, 2024

MAY Day - When will Malaysia get a GOVERNMENT that cares for ALL workers? Minimum Rights for ALL Workers. Short-term contract workers denied RIGHTS that come with tenure.

May Day - is the day commemorating the historic struggles and gains made by workers and the labour movement, observed in many countries on May 1. Long way to go in Malaysia, as worker rights and welfare seems to fall second to employer and business interest.

Malaysian Employment Act and some other laws provide for basic minimum worker rights - but alas, it does not protect all workers - now just for workers generally earning RM4,000 or less - Would it not be better that it covers all workers, for after all, we are just talking about MINIMUM rights in labour laws...{The rationale was higher earning workers can protect themselves - but this is not true, so best to ensure MINIMUM worker rights are enjoyed by all workers. Further, when one enters into an employment agreement, the employer usually has the upper hand and the worker has 'little power' to demand this rights and that .. )

Remember, the Employment Act provides for INCREASE in Rights as you work longer - One example is Annual Leave - for the 1st year of employment, minimum annual leave entitlement is 8 days, for 2-5, minimum annual leave is 12, and if longer that 5 years, the minimum entitlement rises to 16... There are other benefits in law to a worker that increases as time passes. Then, it is common practice that wages tend to increase every year of employment. (But workers on 'short-term or fixed term contracts DO NOT ENJOY THIS BENEFITS - every time he enters into a new short-term contract, the worker starts from scratch - the fact that he had previous working experience, his age, his increased personal and family commitment, etc all just do not matter ...

(1) An employee shall be entitled to paid annual leave of-

(a) eight days for every twelve months of continuous service with the same employer if he has been employed by that employer for a period of less than two years;

(b) twelve days for every twelve months of continuous service with the same employer if he has been employed by that employer for a period of two years or more but less than five years; and

(c) sixteen days for every twelve months of continuous service with the same employer if he has been employed by that employer for a period of five years or more,... (Section 60E, Employment Act 1955)

Looking at some UNJUST laws affecting workers...One example is the evil that arises because workers are not employed as REGULAR employee(i.e. until retirement, or termination due to serious breach employment misconduct, or RETRENCHMENT because of good reason).

Well, an employee is entitled to TERMINATION AND LAY OFF BENEFITS only if they have in employment for more than 12 Months continuously - BUT to avoid this many 'Bad" employers employ workers on 1 year employment contracts, hence the legal obligation to pay termination and lay-off benefits is AVOIDED.

If the contract is immediately renewed, then the worker becomes entitled to TERMINATION AND LAY OFF BENEFITS - and so the BAD Employer do not renew the employment contract although the employer still have work that requires a worker. What some employer do is just EMPLOY a new worker to do the work the previous worker did? 

Another method used by BAD Employers to avoid payment of termination and lay-off benefits, is to wait more than 3O days, and then offer a new contract for a year. Sadly, our laws says it is OK. If new employment contract is entered into more than 30 years later - then employment deemed to start on the day of the NEW contract. If immediately, or within 30 days, then employment period considered to begin on the 1st day of the first contract.


3  General provisions for the entitlement of employees to termination or lay-off benefits payment

(1) Subject to these Regulations, an employer shall be liable to pay termination or lay-off benefits payment calculated in accordance with regulation 6 to an employee who has been employed under a continuous contract of service for a period of not less than twelve months ending with the relevant date if-

(a) the contract of service of the employee is terminated; or

(b) the employee is laid-off within the meaning of regulation 5.

(2) For the purpose of this regulation a continuous contract of service for a period of not less than twelve months shall include two or more periods of employment which are not less than twelve months in the aggregate if the intervening period or periods between one period of employment and another does not in the aggregate exceed thirty days.

Malaysian government, including the current PH led government has done nothing to date to protect workers being 'exploited' through such short-term fixed contracts of a year or less.

Note the REGULATIONS are made by the MINISTER, like current HR Minister Steven Sim. If he is concerned for workers in Malaysia, he can change favour of workers. The Minister does not need approval of Parliament, or even Cabinet, when he makes such Regulations. (Maybe this need to be changed, to maybe requiring Parliamentary approval for Regulations)

What is the solution?

1) Contracts of employment shall be for the entire duration the work the worker is employed to do that work. Maybe, the contract should be for 5 years, and extendable as of right if the work still exist that requires the worker.

2) Better option is to ensure that the worker is a REGULAR employee, that means until retirement age. Now, if the employer do not need the workers anymore for that work, or has come into financial problems that requires the downsizing of workforce, he can legally RETRENCH workers. 

The above 2 solutions is beneficial for the workers in Malaysia, as they will enjoy a certain amount of employment security be it for 5 years(or until the work needing the worker ceases to exist), or at best until retirement.

Note, a REGULAR employee can always be terminated by reason of a very serious employment misconduct, or a serious breach of the employment contract. He can also be RETRENCHED. Hence, giving a worker REGULAR employment really does not prejudice the employer.

3) Of course there are exceptional situations where an employer needs an employee to do a particular work which may be done in a couple of months. For example, in the construction industry, a worker is employed to do tiling work, and after tiling is done - the employer no longer needs the worker with tiling skills. So, this may employment contracts to do a particular work/task that will end. Such contracts of employment may be permitted on the discretion of the Minister.

4) With regard to termination and lay-off benefits, maybe the entitlement should arise after THREE(3) months or automatically after one begins employment- removing the current requirement of employment for more than 12 months. Increase TERMINATION AND LAY-OFF BENEFITS to a minimum of 1 months wages. That is what Indonesia has ... [Remember a terminated worker faces great hardships as his monthly financial obligations remain the same, and it also involves his family. Further, to be able to find a NEW JOB takes time. Will he/she even get a same JOB nearby - or will he have to move his family to some other town and lose out on his rental/deposit and worse if he had purchased his house - so, a 1 Month MINIMUM Termination and Lay-Off Benefit is JUST] 

Severance payment for employee in Indonesia

Completed Years of ServiceSeverance Payment
Less than 1 year1-month wage
More than 1 year but less than 22 months wage
More than 2 years but less than 33 months wage
More than 3 years but less than 44 months wage
More than 4 years but less than 55 months wage
More than 5 years but less than 66 months wage
More than 6 years but less than 77 months wage
More than 7 years but less than 88 months wage

 5) Regulation 3(2) should also be changed - periods of employment with the same employer should be considered. No more wait more than 30 days and employ again to avoid obligations to pay termination and lay-off benefits????

What RIGHTS are denied by short-term contracts?

A employee has the right to FIGHT for better rights and better working conditions - but a fixed short term employee, hoping that his employment contract will be extended(renewed) for FEAR of the employer may abandon his/her worker rights worried that it may jeopardize his future rights, and may even suffer worker rights violation(and not complain or bring it up to relevant Labour authorities). Even regular employees fear the employer's reaction to complaints and demands of better worker rights - will this mean I may be overlooked in terms of promotions, wage increase,etc.. so even worse for the fixed short term employee.

An employee has the right to form and participate in trade unions. Where there is no trade union a short-term contract employee may be deterred to fight to form a trade union at the workplace. Further, even if a union is formed, he may no more be an employee to enjoy the benefits of the Trade Union membership. Even for Collective Bargaining Agreements, a short-term contract employee, even if he fights for better rights/conditions may not enjoy it.

What Minister Steven Sim can do is to ABOLISH SHORT-TERM Employment Contracts, requiring all employees of the core business to be REGULAR EMPLOYEES - this is already done in India(so, there is legal precedence Malaysia can follow)

If Minister Steven Sim, Prime Minister Anwar Ibrahim and this Pakatan Harapan led government is concerned about Malaysian workers and worker rights > they will do the needful to improve EMPLOYMENT Security with the same employer, and worker rights.

# The government always talks about job security - and therefore works on creating more jobs. But what any worker needs is EMPLOYMENT SECURITY with the same employer - noting that the longer one works, wages increase, annual leave and sick leave entitlement increases...

It is not just JOBs that a worker needs. When a worker starts being employed, the amount of monies needed is less, but as years pass by, his financial needs monthly naturally increase with marriage, kids, purchase of homes - so, for the good the workers, in Malaysia - ensure that they get REGULAR employments - not short-term fixed employment contracts - Every time a worker has to find a new job, he starts from the bottom with low pay and rights(His past work experience is seldom considered) Worse, as the worker AGES, he competes with younger workers, and many an employer prefer to employ young workers rather than older workers.



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