Updated: Jan 11, 2021
The outbreak of Coronavirus has significantly impacted the nation, especially since the Prime Minister of Malaysia, Tan Sri Muhyiddin Yassin, declared that entire Malaysia would be on a movement control order starting from March 18 to 31. The goal of this Movement Control Order 2020 is to isolate the source of the coronavirus outbreak. Hence, all private and government businesses, except for essential services, are ordered to be closed throughout the Movement Control Order period.
This had left many employers in doubt as to what their obligations and potential liabilities would be during the Movement Control Order and the Covid-19 Outbreak. Hence we have provided the FAQ below to answer the general queries of employers.
Q: What business can operate during the Control Movement Order?
A: All businesses known as 'essential service' may operate or operate with minimal activities.
Q: What are 'essential services' refer to in Movement Control Order?
A: Essential services include banking and financial industry, electrical and energy, fire, transportation, postal prison, fuel & lubrication production, refining, storage, supply and distribution, healthcare and medical, solid waste management and public cleaning, sewerage, radio communication (broadcast & television), telecommunication, water, e-commerce, defense & security, food supply, wildlife, immigration, customs, hotels and accommodations, and any services or works determined by the Minister as essential or critical to public health or safety.
Q: Can an employer demand employees to work during the Movement Control Order period?
A: No. The employer cannot force employees to work during this period as this would have violated the Movement Control Order.
Q: What if an employee agrees or voluntarily continue to work in the business during the Movement Control Order period?
A: An employer of non-essential businesses has an obligation to ensure that no employees are working during the period otherwise the business premise is deemed to be not closed and would have violated the Movement Control Order.
Q: Is it possible to require employees to work from home?
A: Yes, an employee may be required to work from home if there are necessary facilities to work from home, so as not to expose the employer to potential liability arising from lack of appropriate facilities to properly conduct his/her work.
Q: Can an employer deduct employees' salaries during the Movement Control Order period?
A: During the period of Movement of Control Order, employers are expected not to deduct employees' wages as such deduction is deemed unlawful, under Employment Act 1955 and is seen as a breach of contract by the employer unless the employer has taken.
For an employee whose salary does not exceed RM2,000
Section 24 of the Employment Act 1955 does not allow employers to deduct employees' salaries during the Movement Control Order period.
For an employee whose salary exceed RM2,000
An employer would have the right to deduct an employee's salary if the working contract between the parties, caters for a situation of such, otherwise, this might be a fundamental breach of the contract.
Q: Can an employer request employees to reduce salaries?
A: Yes, an employer may discuss the reduction of salary with employees if the business is at extreme difficulty but this should be the last resort after exhausting all reasonable steps.
Q: Can employers impose unpaid leave during the Movement Control Order period?
A: No. It is not possible for employers to impose unpaid leave for employees during the Movement Control Order as this would amount to a deduction of salary as discussed above.
Q. Can an employer deduct employees' annual leave during the Movement Control Order period?
A: No. Employers are not allowed to utilized employees' annual leave for this purpose.
Q: What are the possible liabilities that an employer may face for breach of the Movement Control Order?
A: In respect of a first offense, imprisonment for a term not exceeding two years or fine or both; In respect of a second or subsequent offense, imprisonment not exceeding 5 years or fine or both; In respect of a continuing offense, a further fine not exceeding RM200 for every day during which such offense continues.
Q: Can employees take action against employers for improper salary or leave deduction?
A: Yes. An employer may be liable to an offense in the Employment Act 1955. Punishable with a fine not exceeding RM10,000 if the employee salary is RM2,000 and below.
If an employee's salary is more than RM2,000 but not exceeding RM5,000 the employee may lodge complain to the Department of Labour. Director-General has the power to inquire into the complaints made by the employee
If an employee's salary exceeds RM5,000 the employee may lodge a complain to the Director-General who shall then attempt to mediate between the parties for an amicable settlement failing which the matter shall be referred to the Industrial Court.
Apart from that, an employee may also bring an action against an employer for constructive dismissal.
Hence, it is advisable for employers to adhere to the guidelines to prevent any unnecessary disputes or liabilities. However, if you are an employer who faced difficulty during this period of time, feel free to get a consultation from us.
The FAQ provided above is for informational purposes only and does not constitute any specific legal advice.