Staff Immediate Resignation in Malaysia: Employer Rights & Responsibilities

Resigning from a job is a normal part of employment. In most cases, employees leave after serving the notice period stated in their employment contract.

However, some employees choose to leave immediately without serving notice. This is known as immediate resignation.

Can employees resign immediately in Malaysia? Can employers reject an immediate resignation? Is payment in lieu of notice required?

This guide explains what employers and employees should know about immediate resignation in Malaysia under the Employment Act 1955.

What Is Immediate Resignation?

Immediate resignation means an employee ends their employment without serving the required notice period stated in the employment contract.

For example, if an employee is required to serve one month's notice but leaves on the same day they submit their resignation, this is generally considered an immediate resignation.

What Does the Employment Act 1955 Say?

Under Section 13 of the Employment Act 1955, either the employer or the employee may terminate the employment contract by giving the required notice.

The Act also allows either party to terminate the contract without serving the required notice by paying an indemnity in lieu of notice. The indemnity is generally equal to the wages that would have been earned during the notice period, unless otherwise agreed.

This means an employee may resign immediately, but whether payment in lieu of notice applies depends on the employment contract and the circumstances.

Can Employees Resign Immediately in Malaysia?

Yes.

Employees may resign immediately, but employers should first review:

The notice period stated in the employment contract.
Whether payment in lieu of notice applies.
Whether both parties have agreed to waive the notice period.
Any other terms stated in the employment contract.

Every resignation should be assessed based on its own circumstances.

Immediate Resignation vs Resignation with Notice

Immediate Resignation	Resignation with Notice
Employee leaves immediately.	Employee continues working during the notice period.
Payment in lieu of notice may apply.	Usually no payment in lieu of notice is required.
Limited time for handover.	Allows time for knowledge transfer and business continuity.

Can Employers Reject an Immediate Resignation?

Generally, employers cannot force an employee to continue working.

However, this does not mean the employee is automatically released from all contractual obligations.

Depending on the employment contract and the Employment Act 1955, employers may still have rights relating to:

Notice periods.
Payment in lieu of notice.
The return of company property.
Confidentiality obligations.
Other contractual terms.

Employers should review the employment contract before deciding on the appropriate course of action.

Will Employees Still Receive Their Final Salary?

Generally, employees remain entitled to receive wages they have already earned before their employment ends.

When calculating an employee's final salary, employers should consider:

Outstanding salary.
Approved overtime payments.
Payment in lieu of notice, where applicable.
Any lawful deductions permitted under the Employment Act 1955.

Final salary should always be calculated according to the Employment Act 1955, the employment contract and company policies.

What Happens to Unused Annual Leave After Immediate Resignation?

Immediate resignation does not automatically mean an employee loses their annual leave entitlement.

Whether an employee is entitled to payment for unused annual leave depends on the Employment Act 1955, the employment contract and the company's leave policy.

When processing annual leave, employers should review:

The employee's remaining annual leave balance.
Whether unused annual leave can be carried forward or encashed under the employment contract or company policy.
Any applicable provisions under the Employment Act 1955.

Employers should calculate annual leave entitlements carefully and ensure any payments are handled according to the law and the employment contract.

Can Employers Take Action if an Employee Resigns Immediately?

It depends on the circumstances.

If an employee does not comply with the notice period stated in the employment contract, employers may have rights under the Employment Act 1955 or the employment contract.

Before taking any action, employers should:

Review the employment contract.
Determine whether payment in lieu of notice applies.
Consider the circumstances surrounding the resignation.
Seek professional HR or legal advice where necessary.

Each case should be assessed individually.

What if an Employee Resigns During Probation?

Immediate resignation during probation is another common question.

Whether a probation employee may resign immediately depends on the notice period stated in the employment contract. Many employers provide a shorter notice period during probation, but this varies between organisations.

Before accepting an immediate resignation during probation, employers should review the employment contract and ensure the resignation is handled according to its terms.

Things Employers Should Consider Before Accepting an Immediate Resignation

When an employee resigns immediately, employers should:

Review the employee's notice period in the employment contract.
Determine whether payment in lieu of notice applies.
Calculate the employee's final salary and annual leave entitlements.
Arrange for the return of company property.
Disable access to company systems where appropriate.
Complete the employee's offboarding process.
Keep written records of the resignation and related communication.

Taking these steps helps employers manage the resignation professionally while reducing the risk of disputes.

FAQs

Can employees resign immediately in Malaysia?

Yes. Employees may resign immediately, but payment in lieu of notice may apply depending on the employment contract, the Employment Act 1955 and the circumstances.

Can employers reject an immediate resignation?

Generally, employers cannot force employees to continue working. However, contractual obligations such as notice periods or payment in lieu of notice may still apply.

Do employees need to pay compensation for immediate resignation?

Employees may need to pay an indemnity in lieu of notice if they do not serve the required notice period, unless the employer agrees otherwise or the Employment Act 1955 provides otherwise.

What happens to annual leave after immediate resignation?

This depends on the Employment Act 1955, the employment contract and the company's leave policy. Employers should review the employee's remaining leave entitlement when processing the final employment benefits.

Will employees still receive their final salary after immediate resignation?

Generally, yes. Employees are entitled to wages they have already earned, subject to any lawful deductions permitted under the Employment Act 1955 and the employment contract.

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