Employment Law & Industrial Relations
Masha Sylverster & Co advises and represents both employers and employees in a wide range of employment law and industrial relations matters under Malaysian law.
We provide clear, practical advice aimed at resolving workplace issues efficiently while protecting our clients' legal and commercial interests.
Practical Advice for Workplace Disputes and Compliance
Our employment law practice covers advisory, contentious, and compliance-related matters arising from employment relationships and workplace disputes.
We act for clients at all stages of an employment dispute, including internal processes, negotiations, and proceedings before the Industrial Court and other relevant forums.
Employment Law Matters We Advise On
Dismissal & Disciplinary Matters
Advice and representation in cases involving dismissal, misconduct investigations, domestic inquiries, and disciplinary proceedings.
Employment Contracts & Policies
Drafting, reviewing, and advising on employment contracts, workplace policies, and terms of employment.
Industrial Relations & Trade Disputes
Representation in industrial disputes, trade union matters, and proceedings before the Industrial Court.
Compliance & Advisory
Advice on compliance with employment-related legislation, regulatory requirements, and best workplace practices.
Negotiation & Settlement
Legal support in negotiations, settlement discussions, and alternative dispute resolution to resolve matters efficiently.
Balanced, Practical, and Outcome-Focused Advice
Employment law in Malaysia governs the relationship between employers and employees across a wide range of issues — from the terms of employment and workplace conduct, to the termination of employment and industrial dispute resolution. Key legislation includes the Employment Act 1955, the Industrial Relations Act 1967, the Trade Unions Act 1959, and the Occupational Safety and Health Act 1994, each providing a framework for rights and obligations in the workplace.
Employment disputes often involve both legal and human considerations. We provide advice that is balanced, practical, and aligned with our clients' objectives — recognising that achieving a constructive outcome is frequently as important as the legal outcome itself.
Dismissal and Disciplinary Proceedings
A dismissal is the most common subject of industrial disputes in Malaysia. Under the Industrial Relations Act 1967, an employee who believes they have been dismissed without just cause or excuse may refer the matter to the Director General of Industrial Relations within 60 days of dismissal. We advise both employers and employees on the conduct of domestic inquiries, the requirements of procedural fairness, and the prospects of any Industrial Court referral.
Constructive Dismissal
Constructive dismissal arises where an employer's conduct — such as a unilateral and fundamental change to terms of employment — forces an employee to resign. The law treats such a resignation as a dismissal. Advice at an early stage is important, as the employee must act promptly and must demonstrate that the employer's conduct constituted a breach that went to the root of the employment contract.
Retrenchment and Redundancy
Retrenchment is permissible in Malaysia where it is genuine and driven by legitimate business reasons such as restructuring or redundancy. Employers must comply with the Employment Act 1955, any applicable collective agreements, and the Code of Conduct for Industrial Harmony — including giving proper notice and paying statutory termination benefits. We advise employers on conducting a legally compliant retrenchment exercise and assist employees in understanding their rights and entitlements.
Employment Contracts and Workplace Policies
Well-drafted employment contracts and workplace policies are essential to managing employment relationships effectively. We assist employers in preparing contracts of employment, employee handbooks, and workplace policies that are compliant with Malaysian employment law and aligned with their operational requirements. For employees, we advise on the interpretation of contract terms and the implications of any proposed variations to employment.
Frequently Asked Questions
What constitutes wrongful dismissal in Malaysia?
Under the Industrial Relations Act 1967, a dismissal is wrongful if it is without just cause or excuse. This covers situations where an employee is dismissed without sufficient reason, where due process was not followed, or where the punishment does not correspond to the alleged misconduct. An employee who believes they have been wrongfully dismissed may refer the matter to the Director General of Industrial Relations within 60 days of dismissal.
What is constructive dismissal in Malaysia?
Constructive dismissal occurs when an employer's conduct — such as a unilateral and significant change to terms of employment — forces an employee to resign. The law treats such a resignation as a dismissal. The employee must show that the employer's conduct constituted a fundamental breach of the employment contract and that the resignation was a direct result of that breach.
Can an employer retrench workers in Malaysia?
Yes. Retrenchment is permitted when it is genuine and due to economic reasons such as business restructuring or redundancy. Employers must comply with the Employment Act 1955, the Code of Conduct for Industrial Harmony, and any applicable collective agreements — including giving proper notice, paying termination benefits, and following the correct procedure.
How long does an Industrial Court case take in Malaysia?
The duration varies depending on the complexity of the matter, the number of witnesses, and the court's caseload. Cases may be resolved within 12 to 24 months of referral, though more complex matters can take longer. Early resolution through conciliation at the Industrial Relations Department may shorten the process significantly.
Does the Employment Act 1955 apply to all employees in Malaysia?
The Employment Act 1955 applies to employees earning up to RM4,000 per month or those engaged in manual labour regardless of salary. Employees earning above this threshold may not be covered by all provisions of the Act but remain protected by the Industrial Relations Act 1967 and their contractual terms of employment. Legal advice is recommended to determine which protections apply to your specific situation.