Who Are the Employees Covered Under the Employment Act 1955?

Many employers in Malaysia are still unclear about who is actually protected under the Employment Act 1955. This matters because compliance affects salary entitlements, working hours, leave, termination rights, and legal responsibilities. Below is a complete breakdown for HR teams and business owners.

What is the Employment Act 1955?

The Employment Act 1955 is the primary legislation governing employment matters in the private sector. It applies to:

Peninsular Malaysia
Federal Territory of Labuan

Meanwhile, Sabah and Sarawak are governed separately under their own Labour Ordinances.

Public sector employees are governed under separate regulations by the Public Service Commission.

Although the legal coverage differs slightly by region, the objective remains similar, protecting employee rights and regulating fair employment practices.

Why Must Employers Comply With the Employment Act?

Employers who do not comply may face:

Fines and penalties under Part XVII of the Act
Audits and inspections by the Labour Department
Legal claims from employees
Business reputation risk

The Labour Department actively enforces the Act through investigations, complaint handling, compliance checks, and mediation.

Who is Covered Under the Employment Act?

Employees covered under the Employment Act fall into two major categories.

A. Employees Earning RM2,000 or Less per Month

Any employee earning RM2,000 or less is automatically covered, regardless of job title.

This can include roles such as:

Office administrators
Customer service staff
General clerks
Retail staff
Junior finance or HR assistants

Once an employee’s salary exceeds RM2,000, coverage will depend on job category, not income alone.

B. Employees Earning Above RM2,000 in Specific Job Categories

Employees earning more than RM2,000 per month are still protected if they fall under one of these categories:

1. Employees Performing Manual Labour

An employee is considered a manual labour worker if:

More than half of their working hours involve physical tasks

This applies to occupations such as:

Warehouse assistants
Construction workers
General labourers
Janitors or cleaning staff
Factory operators

Manual labour refers to physical work, not administrative or management-based responsibilities.

2. Employees Operating or Maintaining Mechanically Driven Vehicles

This group includes:

Company drivers
Lorry drivers
Machine operators
Bus drivers
Crane operators

If an employee operates or maintains such vehicles as part of their job, they are covered under the Act.

3. Supervisors of Manual Labour Workers

Employees supervising manual labourers are covered if:

They hold a supervisory job role
They oversee performance and tasks of manual workers
Supervision duties are consistent and part of their main role

Examples include site supervisors or team leaders managing operational staff.

4. Employees Working on Malaysian-Registered Vessels

This includes vessel or ship workers engaged in any capacity, regardless of salary.

5. Domestic Workers

Domestic employees include individuals performing household-based duties such as:

Housekeepers
Personal drivers
Nannies
Garden maintenance staff
Laundry assistants

Domestic workers fall under a separate protection category, but still within the Employment Act.

What Protections Do Employees Receive Under the Employment Act?

Employees covered under the Act are entitled to minimum statutory benefits, including:

Basic Employment Benefits

Paid rest days
Public holidays
Overtime payments
Leave entitlements
Maternity protection
Paid sick leave

Employment Security

Minimum termination notice periods
Payment of wages within seven days
Termination and lay-off benefits

Legal Protection

Ability to file complaints with the Labour Office
Access to mediation and enforcement

Employees not under the EA must rely on their employment contracts and civil legal procedures.

What About Employees Not Covered Under the Employment Act?

Employees outside the EA will need to depend on:

Terms stated in their employment contracts
Company HR policies
Negotiated benefits

Disputes for non-EA employees are generally handled through civil claims rather than labour office proceedings.

Employers must therefore draft employment contracts carefully to avoid disputes.

Are Part-Time Workers Covered Under the Employment Act?

Part-time workers may be covered based on job nature and salary.

If they fall within EA definitions, they are protected under the Employment (Part-Time Employees) Regulations 2010, which provides prorated entitlements such as:

Annual leave
Public holiday entitlements
Overtime eligibility

If not covered by EA, their rights depend on contractual agreements.

Who is Covered Under EA?

Employee Category	Covered Under EA?
Salary RM2,000 and below	Yes
Salary > RM2,000 but performing manual labour	Yes
Supervisors of manual labour	Yes
Drivers, operators, mechanics	Yes
Domestic workers	Yes
Employees working onboard Malaysian-registered vessel	Yes
Salary > RM2,000, non-manual, managerial	No
Public sector employees	No

FAQs

Is HR staff covered under the Employment Act?

HR personnel earning RM2,000 and below are covered. Those above RM2,000 are generally not covered because their role is administrative/managerial.

Does the Employment Act apply to probation employees?

Yes. Probationers are treated similar to permanent employees in terms of minimum statutory rights.

Is overtime claimable for employees earning above RM2,000?

Employees earning above RM2,000 will only qualify for overtime if their job category falls under any EA-protected group.

What is the minimum notice period under the EA?

The minimum varies depending on length of service, unless contract states higher:

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

Does EA cover part-time workers and freelancers?

Part-timers may be covered, depending on monthly wages and job function. Freelancers are not covered because they do not fall under Contract of Service.

Need Staff Urgently? We’ve Got You Covered!

With AJobThing, access a massive pool of jobseekers and hire the right talent faster than ever.

Get started today and fill your vacancies with ease!