Breaking Down Overtime Rates
Sometimes an employee is expected to put in extra effort and work over and beyond the official work hours as an exigencies of work so require. Don’t worry, as an employee you may be paid for this extra work carried out in excess of the normal working hours.
What are the normal working hours?
Under the Employment Act 1955 (Act 265) an employee shall not work more than eight (8) hours in one day, more than forty-five (45) hours in a week and after five (5) hours of continuous work, the employee is entitled to a rest period of at least 30 minutes.[1]
Who is entitled to overtime pay?
An employee with wages less than Ringgit Malaysia Four Thousand (RM4,000.00) is entitled to overtime pay.[2]
What is the rate for overtime pay?
- Daily/hourly rate employee
Category |
| Rate
|
Normal weekday | : | Not less than one and half times his hourly rate of pay (1.5)[3] |
Rest day a) Not exceed half his normal hours of work b) More than half but does not exceed his normal hours of work c) In excess of the normal hours of work | : : : | One day’s wages at the ordinary rate of pay (1.0) [4] Two days’ wages at the ordinary rate of pay (2.0) [5] Not less than two times his hourly rate of pay (2.0)[6] |
Public holiday a) Less than the normal hours of work b) In excess of the normal hours of work | : : |
Two days’ wages at the ordinary rate of pay (2.0) [7] Not less than three times his hourly rate of pay (3.0) [8]
|
- Monthly/weekly rate employee
Category |
| Rate
|
Normal weekday | : | Not less than one and a half times his hourly rate of pay (1.5)[9] |
Rest day a) Not exceed half his normal hours of work b) More than half but does not exceed his normal hours of work c) In excess of the normal hours of work | : : : | Half the ordinary rate of pay for work done on that day pay (0.5) [10] One day’s wages at the ordinary rate of pay (1.0) [11] Not less than two times his hourly rate of pay (2.0)[12] |
Public holiday a) Less than the normal hours of work b) In excess of the normal hours of work | : : |
Two days’ wages at the ordinary rate of pay (2.0) [13] Not less than three times his hourly rate of pay (3.0) [14]
|
Fair overtime pay will avoid disputes between employees and employers. It also shows respect and helps build trust between employees and employers.
Clear and fair overtime rules make a big difference in how employees see their jobs and their workplace.
Please reach out to us should you need any legal help at penang@nglaw.com.my or +601154304970 / +6046024970.
Kindly take note that this article contains general information only and shall not constitute legal advice.
[1] Section 60A(1) of the Employment Act 1955 (Act 265)
[2] Section 1A of the First Schedule of the Employment Act 1955 (Act 265)
[3] Section 60A(3)(a) of the Employment Act 1955 (Act 265)
[4] Section 60(3)(a)(i) of the Employment Act 1955 (Act 265)
[5] Section 60(3)(a)(ii) of the Employment Act 1955 (Act 265)
[6] Section 60(3)(c) of the Employment Act 1955 (Act 265)
[7] Section 60D(3)(a)(i) of the Employment Act 1955 (Act 265)
[8] Section 60D(3)(aa) of the Employment Act 1955 (Act 265)
[9] Section 60A(3)(a) of the Employment Act 1955 (Act 265)
[10] Section 60(3)(b)(i) of the Employment Act 1955 (Act 265)
[11] Section 60(3)(b)(ii) of the Employment Act 1955 (Act 265)
[12] Section 60(3)(c) of the Employment Act 1955 (Act 265)
[13] Section 60D(3)(a)(i) of the Employment Act 1955 (Act 265)
[14] Section 60D(3)(aa) of the Employment Act 1955 (Act 265)
