Since this may or may not happen to anyone of us but I think this is something good to know your rights or how you’re protected by labor law in Malaysia especially when you’re being retrenched. I only highlight the most critical one which is how much the employer should pay you back.
Under the Employee Act 1055 or Industrial Relation Act 1967, labor law in Malaysia, this is the minimum amount of money the employee should compensate us if they decide to retrench us. If you have been working for a company:
Between 1 to 2 years, you should get minimum of 10 days salary for each year of your service.
Between 2 to 5 years, you should get minimum of 15 days salary for each year of your service.
Above 5 years, you should get minimum of 20 days salary for each year of your service.
It will be pro-rated if the number of years of services is not a whole number. For example, if you work for 1.5 years, the formula will be something like this:
($1 Year Salary / 365 Days) X (1.5 Years) X (10 Days)
If you look at it, the compensation law is not that much if the company decides to pay you the minimum. All the while I have the wrong impression that compensation for retrenchment is very good because of our labor law. Perhaps I do not aware those company specifically Intel used to compensate way more than the minimum amount that protected by Malaysian Labor Law. It may not happen again in the future with the current economy situation. Don’t you think so?
credit to: http://financialindependent.blogspot.com/2009/02/understand-retrenchment-labor-law-in.html
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