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Issues 1


MARCH 2013

Chief Fun Officer : Mr. Iqbal Place : Bowling (Ampang Point) Date : 15 March 2013
APRIL 2013

Chief Fun Officer : Mr. Fauzi
Place : MBO (Galaxy Ampang)
Date : 12 April 2013
JULY 2013

Chief Fun Officer : Mr. Syazwan &
Mr. Adib
Place : Universal Studio Singapore
Date : 6 July 2013

Visit and contribute at Rumah Anak-anak Yatim Baitul Ehsan Al-Khairi
Date : 2nd August 2013

Employment Agreement:

 To Have or Not To Have?

To employ and getting employed is a happy occasion for both employee and employer. It is the beginning of joyful relations of a win-win situation. Or is it?

This article is to give an insight for the need for both, the employer and the employee, to have an employment agreement in writing at their workplaces.

The Malaysian Employment Law which is codified in the Employment Act 1995 specifically takes care of the interests of one particular section of the employees, i.e employees which fall under First Schedule of the Employment Act 1995 (“the Act”). An employee who does not fall under the ambit of First Schedule of the Act is not protected by the Act. It simply means that not all employees are protected by the Act.

The question then, how would other employees who were not within the ambit of First Schedule be protected? For all other employees, who do not fall within this definition, the terms of their employment (such as appointment, remuneration, dismissal and all other obligations) are, not being specifically detailed under the Act, contractual in nature. As such the Contracts Act 1950 and various common law rules will apply.

It is then very obvious that to regulate the contractual relationship between employer and employee who are not protected by the Employment Act 1995 it is important for them to have a well written Employment Agreement. It is therefore vital to detail out all the terms of employment as comprehensive as possible.

It is an open secret that many small business entities do not have written employment agreement with their employees. Either deliberate or ignorance, it is advised that both employer and employee should get well written employment agreement in place in order to avoid future complications in the event there is any dispute on the terms of employment agreement.

Who then are protected by the Act?
Employees protected by the Act are :
  1. Any person whose wages does not exceed RM2,000.00 per month:
  2. Any person who, irrespective of the wages he/she earns in a month, and not engaged in:
  • manual labour
  • the operation
  • one who supervises and oversees employees in manual labour.

3. Any person engaged in any vessel registered in Malaysia with certain exceptions.

4. Domestic servant

Note : We have, from time to time, been consulted by business owners in drafting documents and welcome any enquiry on partnership, shareholder and Join Venture Agreement