Contract of Service Malaysia Maksud

Contract of Service Malaysia: Understanding the Basics

A contract of service is a legal agreement between an employer and an employee that outlines the terms and conditions of their working relationship. In Malaysia, the Employment Act 1955 governs the laws concerning employment contracts in the country.

Understanding the different types of employment contracts

In Malaysia, there are two types of employment contracts – contract of service and contract for service. A contract of service is a relationship between an employer and an employee where the employer has control of the employee`s work, while a contract for service is a relationship between an employer and an independent contractor who is responsible for his or her own work.

In a contract of service, the employee is considered an employee of the company, and the employer is responsible for paying salary, benefits, and any other entitlements. On the other hand, in a contract for service, the independent contractor is not considered an employee of the company, and the employer is not responsible for paying any salaries or benefits.

Understanding the terms and conditions of a contract of service in Malaysia

The terms and conditions of a contract of service in Malaysia are governed by the Employment Act 1955. According to the act, the employer is responsible for providing written employment terms to the employee within two months of his or her start date.

The written employment terms include a variety of information, including job title, remuneration, working hours, leave entitlements, and termination procedures. The written employment terms must be signed by both the employer and the employee, and a copy of the agreement must be kept by both parties.

In addition to the written employment terms, the Employment Act 1955 also outlines some minimum requirements for employers, such as providing employees with a minimum of 10 public holidays per year and at least 14 days of annual leave after one year of service.

Understanding the termination procedures for a contract of service in Malaysia

Termination procedures for a contract of service in Malaysia are also governed by the Employment Act 1955. According to the act, either the employer or the employee can terminate the contract of service by giving notice to the other party.

The notice period required varies depending on the length of service of the employee, with a minimum notice period of four weeks for employees who have been with the company for more than two years. In addition, employers are required to pay termination benefits to employees who have been with the company for more than 12 months.

Conclusion

A contract of service is an essential legal document that outlines the terms and conditions of the employment relationship between an employer and an employee. In Malaysia, the Employment Act 1955 governs the laws concerning employment contracts in the country, including the written employment terms, minimum requirements, and termination procedures. It is important for both employers and employees to fully understand these laws to ensure that they are in compliance with the regulations and to protect themselves legally.