Annual Leave Malaysia
Complete guide to paid leave entitlement under Employment Act 1955
Why Malaysian SMEs Choose HavaHR Payroll
Understand your statutory leave rights under EA 1955
Calculate pro-rata leave for new employees
Know the difference between annual leave and other leave types
Ensure employer compliance with minimum requirements
Learn about leave encashment upon termination
Track leave balance accurately
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Under Section 60E of the Employment Act 1955, Malaysian employees are entitled to minimum paid annual leave of: 8 days (less than 2 years service), 12 days (2-5 years service), and 16 days (more than 5 years service). This applies to employees earning RM4,000 or less monthly, or manual workers regardless of salary.
Annual leave (cuti tahunan) is a statutory entitlement for Malaysian employees under the Employment Act 1955. Employers must provide paid leave days for rest and personal time, calculated based on years of continuous service. Understanding leave entitlement helps both employers ensure compliance and employees know their rights under Malaysian labour law.
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HR Automation for Malaysian SMEs
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- Generates compliant HR letters instantly — offer letters, warning letters, termination letters compliant with Employment Act 1955
- Tracks leave & attendance — annual leave, sick leave, medical leave with automatic entitlement calculations
- Automates statutory payroll calculations — EPF, SOCSO, EIS, PCB with accurate Malaysian rates
- Works without an HR department — designed for SMEs
Frequently Asked Questions
What is the minimum annual leave in Malaysia?
Under Section 60E of the Employment Act 1955, the minimum annual leave in Malaysia is: 8 days (less than 2 years service), 12 days (2-5 years service), and 16 days (more than 5 years service). These are PAID leave days that employers must provide.
Can employers give less than 8 days annual leave in Malaysia?
No, employers cannot provide less than the statutory minimum under Employment Act 1955. Providing less is illegal and employees can file a complaint with the Labour Department. Employers can provide MORE than the minimum but never less.
How is annual leave calculated for new employees in Malaysia?
For employees who have not completed 12 months of service, annual leave is calculated pro-rata. Formula: (Number of completed months / 12) × Annual entitlement. For example, 6 months service with 8-day entitlement = (6/12) × 8 = 4 days.
Can annual leave be carried forward in Malaysia?
The Employment Act 1955 does not mandate carry-forward of annual leave. However, many employers allow unused leave to be carried forward for a limited period (usually 3-6 months). Check your employment contract or company policy for specific rules.
Can employers force employees to take annual leave in Malaysia?
Yes, employers can require employees to take annual leave during company shutdowns (e.g., festive periods, factory maintenance). However, they must provide reasonable notice and cannot force unpaid leave if employees have leave balance.
What happens to unused annual leave upon resignation in Malaysia?
Under Section 60E(3) of the Employment Act 1955, employees are entitled to payment in lieu of unused annual leave upon termination. The payment is calculated as: (Annual salary / 365) × Number of unused leave days.
Is annual leave the same as public holiday leave in Malaysia?
No, annual leave and public holidays are separate entitlements. Malaysia has 11 gazetted public holidays (per Section 60D), and these do not reduce annual leave entitlement. If a public holiday falls on a rest day, a replacement day is required.
Can annual leave be converted to cash in Malaysia?
Generally, annual leave cannot be converted to cash during employment - the purpose is for employee rest and wellbeing. Cash conversion is only allowed upon termination for unused leave balance.
Does the Employment Act 1955 apply to all employees?
The EA 1955 annual leave provisions apply to employees earning RM4,000 or less per month, or those engaged in manual labour regardless of salary. For higher earners, leave entitlement depends on the employment contract.
How to calculate annual leave for part-time employees in Malaysia?
Part-time employees (under 70% of normal hours) are covered by the Employment (Part-Time Employees) Regulations 2010. Leave is calculated pro-rata based on hours worked compared to full-time equivalent.