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I Understand

SNAPSHOT 2020 – LOOKING AHEAD FOR EMPLOYERS

January 2020

by Yap Yeong Hui

 

What changes to do we expect to see in 2020 affecting employers? There has been a flurry of activities since our last general election as the new Government introduces changes which have wide implications for businesses. We outline upcoming issues and laws that employers should be aware of in 2020.

 

A. Minimum Wages Increased in 57 Cities

In the new year, employers will need to make wage adjustments to meet the minimum wage increase. Employees in 57 towns around the country will see their minimum wage increased to RM1,200.

 

B. Amendments to the Industrial Relations Act 1967

The Industrial Relations (Amendment) Bill 2019 was passed by both the Dewan Rakyat and Dewan Negara. It is a matter of time before the amendments will come into effect. Key changes include:

  • Unless settled, an employee’s representation that he was unfairly dismissed will be referred to the Industrial Court. The Ministry of Human Resources’s discretion to refuse to refer will be removed.
  • A party unhappy with the decision of the Industrial Court can appeal against the decision to the High Court. With an appeal, the High Court is not restricted to only reviewing the decision making process of the Industrial Court but can look into the factual and legal findings of that Court.
  • To address the issue of employers delaying in complying with the orders of the Industrial Court, the Court can impose interests for awards relating to payment of money. The fine that can be awarded for non-compliance with an award is increased from RM2,000 to RM50,000.

 

C. Having an Anti-Corruption Policy

As you may be aware, section 17A of the Malaysian Anti-Corruption Commission Act2009 (MACCA) makes a commercial organisation liable if an associated person (including an employee or agent) commits corruption with the intent to secure business or an advantage for the organisation. A defence is if it has adequate procedures to prevent commission of corruption. Adequate procedures include having an anti-corruption policy and whistleblowing procedures. While the Government has announced that it would enforce Section 17A from June 2020, currently this has not been confirmed by a Government Gazette.

However, from 1 June 2020, companies listed on the Main Market and the ACE Market must introduce anti-corruption measures. From that date, a new paragraph 15.29 to the Main Market Listing Requirements and a new Rule 15.28 to the ACE Market Listing Requirements will take effect. These provisions require:

    1. a listed issuer and its board of directors are to ensure that:–

i. policies & procedures on anti-corruption are established and maintained;

ii. policies and procedures for whistle-blowing are established and maintained;

iii. at least once every 3 years, a review is to be done to assess their effectiveness; and

iv. corruption risk is included in annual risk assessments.

    1. a listed issuer to publish on its website its anti-corruption and whistleblowing policies & procedures.

 

D. Amendments to the Employment Act 1955 (EA)?

According to the proposed Bill to amend the EA and updates set out in the Malaysia Budget 2020 which was announced in October 2019, the following are possible amendments to be made to the EA:

  • increase of maternity leave from 60 days to 90 days;
  • extension of eligibility to overtime to those earning less than RM4,000 per month;
  • introduction of provisions prohibiting discrimination based on race, religion and gender.

If you have any queries regarding the above, contact Mr. Yap Yeong Hui at yapyeonghui@chooi.com.my.

This material is for general information only and is not intended to provide legal advice. If you have any queries regarding the above, please feel free to contact us at insights@chooi.com.my.