THE Employment Act 1955 (Act 265) and the Labour Ordinances of Sabah (Cap 67) and Sarawak (Cap 76) apply to Peninsular Malaysia and to Sabah and Sarawak respectively. The act and ordinances provide for a minimum standard in the terms and conditions of work which form the contract of service between the employer and the employee.

The Employment Act 1955 does not apply to all employees. It only covers the categories of employees listed in the First Schedule to the act. According to the Statistics Department, the employees category accounted for 75.7% of the total employed persons in January. (16.16 million persons).

Under the act, an employee is entitled to a minimum of 11 paid public holidays. If any of the 11 gazetted public holidays falls on a rest day, the following working day is a paid holiday.

An employer is under a duty to put up at a conspicuous part of the place of the employment, before the commencement of each calendar year, a notice specifying the public holidays to which the employee is entitled.

Under the act, an employee who is employed on a monthly, weekly, daily, hourly or other similar basis may be required by his employer to work on any paid holiday. However, in addition to the holiday pay for that day the employee is entitled to be paid two days wages – section 60D(3)(a).

A piece rated employee will be paid twice the ordinary rate per piece plus the salary payable for that day.

An employee is also entitled to travelling allowance for that day if such allowance is payable under the terms of his agreement – section 60D(3)(b).

For any overtime work carried out by an employee on any paid holiday in excess of the normal hours of work, he is entitled to three times his hourly rate of pay, or in the case of piece-rated employees, three times the ordinary rate per piece – section 60D(3)(aa), (aaa).

Former Treasury secretary-general Mohd Sheriff Mohd Kassim wrote in 2019 that companies “have to pay their employees three to four times more than the daily wage rate when they work on public holidays.”

“Some unscrupulous employers resort to using illegal foreign workers and exploiting them to avoid paying more,” he added.

He said a country in Europe that was noted for its addiction to holidays became insolvent and had to be bailed out by international institutions. They agreed to help but with strict conditions that in addition to the structural economic, fiscal and institutional reforms to remove the rigidities and obstacles in the economy, the debtor country had to stop disrupting the labour market with wasteful holiday benefits.

That one country was not named, but the message was clear: having too many public holidays is an extravagant practice that is in conflict with economic management.

On account of the above, it is not truthful to say that an unscheduled public holiday would not cost private employers anything. 

A former prime minister once famously pronounced that the era of “the government knows best” was over. He also said that a peaceful and prosperous country is only possible when the government and the people work together.

Guess which prime minister?

Salam Aidilfitri. Maaf zahir dan batin. – April 21, 2023.

* Hafiz Hassan reads The Malaysian Insight.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.