Information SharingSocial

Malaysia Employment Act 2026 – Essential Guide for Employers & Employees

Posted LnCoadmin

As Malaysia moves into 2026, employment regulations continue to evolve to strengthen employee protection while ensuring fair and compliant business operations.
Below is a clear and practical summary of key Employment Act 1955 requirements applicable in 2026, covering working hours, employee entitlements, statutory contributions, and minimum wage obligations.

Employee Leave Entitlements

1.Sick Leave

  • 0 – 2 years of service: 14 days
  • 2 – 5 years of service: 18 days
  • More than 5 years of service: 22 days
  • Hospitalization leave: 60 days (not inclusive of sick leave)

2.Annual Leave

  • 1 – 2 years of service: 8 days
  • 2 – 5 years of service: 12 days
  • More than 5 years of service: 16 days

3.Maternity Leave

  • 98 days of paid maternity leave

4. Public Holidays

  • Minimum of 11 paid public holidays per year
  • 5 days are compulsory public holidays
  • Work on Public Holidays
  • Rest day work: 2 times the normal rate
  • Work on a public holiday: up to 3 times the normal wage

5. Overtime Rates

  • Normal working day: 1.5x
  • Rest day: 2.0x
  • Public holiday: 3.0x

6. Resignation Notice Period

Employees are required to observe the following minimum notice periods (unless otherwise stated in the employment contract):

  • Less than 2 years of service: 4 weeks
  • 2 – 5 years of service: 6 weeks
  • More than 5 years of service: 8 weeks

7. Minimum Wage

  • Minimum wage: RM1,700 per month

8.Working Hours
Under the Employment Act:

  • Maximum 45 working hours per week
  • Maximum 8 working hours per day
  • Employees are entitled to at least 1 rest day per week

Any work beyond statutory hours must be compensated in accordance with overtime regulations.

9. Statutory Contributions

Employees Provident Fund (EPF)

  • Employee contribution: 11%
  • Employer contribution: 12% – 13% (subject to salary level)

SOCSO (Social Security Organisation)

  • Employee contribution: 0.5%
  • Employer contribution: 1.75%

EIS (Employment Insurance System)

  • Employee contribution: 0.2%
  • Employer contribution: 0.2%

PCB

Calculated based on LHDN tax guidelines, taking into account salary, marital status, number of dependents, and applicable tax reliefs

 

**data updated on 5.1.2026